Amazon CEO Jeff Bezos sold more than $1B worth of stock this week • Hacker News Board

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#21

Post by manigandham » Sat, Nov 04, 2017, 1:54 AM UTC

beardicus wrote: post #13

tyingq wrote: post #9

Earlier quoted context omitted.

Is that all though? I'm guessing that plus whatever regular income tax for his bracket is...which is higher than all that combined. Edit: Why downvote a question? I appreciate the answers, and suspect I'm not the only interested party.

> I assume that plus whatever regular income tax for his bracket is No. Capital gains aren't income.

Yes they are.

Ordinary income = salary/wages, bonuses, commissions, etc.

Capital gains are income, but short-term (within a year) are taxed at ordinary income rates, while long-term (greater than a year) are charged at special capital gains tax rate.

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#22

Post by loeg » Sat, Nov 04, 2017, 1:55 AM UTC

jbusma wrote: post #15

tyingq wrote: post #9

Earlier quoted context omitted.

Is that all though? I'm guessing that plus whatever regular income tax for his bracket is...which is higher than all that combined. Edit: Why downvote a question? I appreciate the answers, and suspect I'm not the only interested party.

Provided the security/asset is held for a year or more, it is taxed as Long-Term Capital Gains, and given quite the tax break. It is even possible to pay 0% federal rate on sale of stock, I did it on my 2016 return.

> It is even possible to pay 0% federal rate on sale of stock, I did it on my 2016 return.

Up to the top of the 15% bracket, yes, or $37,950 in total income for single earners in 2017 ($75,900 joint). It's easy to pay little in long-term cap. gains taxes if you are retired (or unemployed) with a cheap-to-moderate lifestyle.

But not possible for ~$1 billion in gains, like Bezos' sale :-).

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#23

Post by [deleted] » Sat, Nov 04, 2017, 1:56 AM UTC

jbusma wrote: post #15

tyingq wrote: post #9

Earlier quoted context omitted.

Is that all though? I'm guessing that plus whatever regular income tax for his bracket is...which is higher than all that combined. Edit: Why downvote a question? I appreciate the answers, and suspect I'm not the only interested party.

Provided the security/asset is held for a year or more, it is taxed as Long-Term Capital Gains, and given quite the tax break. It is even possible to pay 0% federal rate on sale of stock, I did it on my 2016 return.

[deleted]

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#24

Post by [deleted] » Sat, Nov 04, 2017, 1:58 AM UTC

jbusma wrote: post #15

tyingq wrote: post #9

Earlier quoted context omitted.

Is that all though? I'm guessing that plus whatever regular income tax for his bracket is...which is higher than all that combined. Edit: Why downvote a question? I appreciate the answers, and suspect I'm not the only interested party.

Provided the security/asset is held for a year or more, it is taxed as Long-Term Capital Gains, and given quite the tax break. It is even possible to pay 0% federal rate on sale of stock, I did it on my 2016 return.

[deleted]

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#25

Post by alexasmyths » Sat, Nov 04, 2017, 2:00 AM UTC

adventured wrote: post #7

$94.6 billion net worth at present per Bloomberg. I know he is basically guaranteed to be running all of these sales off a sale schedule set far in advance for obvious reasons. However, I'd probably be doubling up those $1 billion sales until/unless this market gives out. Raising $6 or $10 billion - enough to fund Blue Origin for maybe a decade - by selling out of a $94 billion base, sure beats doing the same out of…

All of this is entirely dependent on whimsy.

Amazon P/E is basically in the clouds.

They and Telsa in some ways are basically impossible to value.

So, people make difficult guesses.

Though I agree that because AMZN could probably simply 'turn on profit' at any time, and so the classical P/E is not a great measure ... at the same time ... a small dip in something could ruin them.

It only takes just a little bit of return to 'normal P/E' to wipe most of that out.

It's all emotion and intellectual pontification right now, and that's a crazy place to own a stock.

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#26

Post by prewett » Sat, Nov 04, 2017, 2:14 AM UTC

My initial question was how did he sell $1B and not affect the share price substantially. And sure enough, the share price did drop a bit. But average trading volume is about 2 billion shares, which is about $2B. It's pretty crazy that the market has so much liquidity that $2B of AMZN changes hands every day, and that it could soak up a $1B sale and barely change the price.

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#27

Post by Bromskloss » Sat, Nov 04, 2017, 2:17 AM UTC

adventured wrote: post #16

hkmurakami wrote: post #11

Earlier quoted context omitted.

Well in real terms Bill Gates in the dot-com era might still have the edge.

Gates went from $10 billion to ~$78 billion ($68b gain; he topped out near $100b around Dec 1999) in about four years from mid 1994 to mid 1998. With an inflation adjustment, it's probably in his favor or very close. Masayoshi Son went from around $2 billion in early 1995, to $77 billion by the peak in late 1999 / early 2000 or so. Yasumitsu Shigeta was worth $42 billion briefly in February 2000, up from $1 billion a…

Were you just sitting on these data?

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#28

Post by mabbo » Sat, Nov 04, 2017, 2:23 AM UTC

prewett wrote: post #26

My initial question was how did he sell $1B and not affect the share price substantially. And sure enough, the share price did drop a bit. But average trading volume is about 2 billion shares, which is about $2B. It's pretty crazy that the market has so much liquidity that $2B of AMZN changes hands every day, and that it could soak up a $1B sale and barely change the price.

Because the market knows ahead of time he's going to do this- it's pre-announced. Any shift caused by it would happen weeks or months ahead of time, slowly, quietly.

And so it's no big deal the day it actually happens.

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#29

Post by aqsheehy » Sat, Nov 04, 2017, 2:38 AM UTC

prewett wrote: post #26

My initial question was how did he sell $1B and not affect the share price substantially. And sure enough, the share price did drop a bit. But average trading volume is about 2 billion shares, which is about $2B. It's pretty crazy that the market has so much liquidity that $2B of AMZN changes hands every day, and that it could soak up a $1B sale and barely change the price.

Markets are efficient

Re: Amazon CEO Jeff Bezos sold more than $1B worth of stock this week

#30

Post by olympus » Sat, Nov 04, 2017, 2:43 AM UTC

prewett wrote: post #26

My initial question was how did he sell $1B and not affect the share price substantially. And sure enough, the share price did drop a bit. But average trading volume is about 2 billion shares, which is about $2B. It's pretty crazy that the market has so much liquidity that $2B of AMZN changes hands every day, and that it could soak up a $1B sale and barely change the price.

Minor correction: Google finance shows average volume at 3.7M shares, which at $1,100 per share is about $4B daily. Selling a billion dollars is still a significant chunk, so your point stands.