Effect of economic crisis on America’s small businesses [slides] • Hacker News Board

Re: Effect of economic crisis on America’s small businesses [slides]

#471

Post by WalterBright » Sun, Mar 22, 2020, 1:50 AM UTC

sangnoir wrote: post #468

WalterBright wrote: post #462

Earlier quoted context omitted.

The beauty of capitalism is "we" don't decide CEO pay. The owners of the company do, and it's paid out of the owners' pocket. Anyone is free to start a corporation, name a CEO, and pay him whatever they want to (from their money). They can even name themselves CEO!

> The owners of the company do, and it's paid out of the owners' pocket. This is not true for publicly traded companies - where the board (consisting mostly executives at other companies) determines compensation on behalf of the owners

The board members operate only at the pleasure of the shareholders, so the shareholders ultimately determine CEO pay and are the ones who are paying it. Shareholders can (and often do) sell their stock the moment they don't like what the board and CEO are doing.

Re: Effect of economic crisis on America’s small businesses [slides]

#472

Post by aaron_m04 » Sun, Mar 22, 2020, 2:38 AM UTC

mindslight wrote: post #227

ip26 wrote: post #125

Earlier quoted context omitted.

We might have enough food etc stockpiled, but the servicing of debt (upon which everything is built) drives a certain modest urgency through the whole system.

The need to service crushing debt is a large part of what everybody is hoping will fall away. A primary economic concern right now is people losing their homes for failing to make rent, whether they rent from a landlord or "own". Businesses will go bankrupt for much the same reason - high burn rates that were mainly just going to the banks. Debt has metastasized and spawned many industries, so its retraction is unlik…

Yes! That's what my comment was hinting at.

We have:

* work to be done

* people willing and able to do the work

* resources with which to do the work

So what exactly is stopping us from putting those three together?

Re: Effect of economic crisis on America’s small businesses [slides]

#473

Post by zaroth » Sun, Mar 22, 2020, 3:16 AM UTC

senordevnyc wrote: post #438

zaroth wrote: post #190

Earlier quoted context omitted.

The vast majority of people with COVID do not end up at the hospital. So it is absolute fact that we are sacrificing the economy in order to save, relatively speaking, a select few . If this continues for more than a few weeks - 50% of American business dies. 50% of America is unemployed. Contagion from massive defaults and write-offs spreads throughout the entire economy. Money printing at a rate heretofore unimagin…

I can’t believe you’re still here spouting off your half-baked opinions on this pandemic. A few weeks ago you were all over this site proclaiming this as overblown and no big deal. At what point will you admit that you have no idea what you’re talking about, and that you represent an extremely dangerous and irresponsible mindset that will ultimately cost millions of lives? Seriously, you have zero expertise and you’v…

I stand by every comment I’ve made. None of which included personal attacks. Most of which included citations.

Your personal attack is entirely inappropriate. I suggest perhaps it’s you that should take a break from the discussion.

As we can see just looking at how different countries have responded, there is a wide spectrum of responses, and countries have been successful getting R0 below 1 with different approaches other than total shutdown.

Even the Imperial College report notes that there are no easy choices here;

> We do not consider the ethical or economic implications of either strategy here, except to note that there is no easy policy decision to be made. Suppression, while successful to date in China and South Korea, carries with it enormous social and economic costs which may themselves have significant impact on health and well-being in the short and longer-term.

It’s crucial to note that there cannot be population health without economic health. It is not a choice between shutting down to save lives versus keeping the economy running and costing lives.

Computational Biologist Francois Balloux (Director of UGI at UCL) raises the point;

> The covid-19 pandemic is not just an epidemiological problem. It is a ‘Global Health’ problem, that can only be tackled with an integrated and global approach. For example, there is no such thing as a choice between managing the pandemic vs. protecting the economy. (11/12)

> Health and the economy are closely linked. The correlation between per-capita GDP and health (life expectancy) is essentially perfect. If the covid-19 pandemic leads to a global economy collapse, many more lives will be lost than covid-19 would ever be able to claim. (12/12)

https://twitter.com/ballouxfrancois/status/12388371731111403...

Re: Effect of economic crisis on America’s small businesses [slides]

#474

Post by justanotherc » Sun, Mar 22, 2020, 5:09 AM UTC

oggy wrote: post #464

justanotherc wrote: post #426

Earlier quoted context omitted.

There is a shortage of masks and other PPE because people think that way. There is a cost because if everyone were to wear masks, there is not enough supply for healthcare professionals who could actually benefit from them. The percentage of effectiveness isn't really measurable if the standard isn't followed. You're assuming its 50%, but it very well could be 0% because your equipment is just as contaminated as your…

I agree that we shouldn't be taking the supply away from the professionals while there's a shortage, but your statement was that they were ineffective in the hands of laymen, and I don't think that's true. I'm not assuming that they are 50% effective either, I pulled the 50% number out of my ass, but so is your 0%, and I find it hard to imagine a physical reality where me keeping a 6 feet distance to an infected pers…

I'm not an expert on infection control, but I work closely with people who either work in the infection control department of a hospital, or are running their own infection prevention and control consultancy. They live and breathe this, and I am only repeating almost verbatim what they have explained to me. I'm pretty sure they have "thought this through".

So believe what you want, but I'm gonna go with the experts on this, not someone who's only support is his own conjecture lol. They're not even the only ones saying this. Go Google some reputable sources yourself and stop guessing.

Re: Effect of economic crisis on America’s small businesses [slides]

#475

Post by vkou » Sun, Mar 22, 2020, 6:39 AM UTC

xyzzyz wrote: post #356

vkou wrote: post #317

Earlier quoted context omitted.

It also brought an unprecedented amount of economic development to what was an incredibly backwards country. Not that it's a model to imitate. Although some folks in this thread sound rather ready to sacrifice millions of people, for the sake of keeping the economy limping along...

Immediate aftermath of October Revolution was widespread death and famine. It was so bad that the communists introduced market capitalism again, called New Economic Policy.

The immediate aftermath of the October Revolution was actually five years of a civil war that killed ten million people, which was then capped off by a severe drought.

Re: Effect of economic crisis on America’s small businesses [slides]

#476

Post by vkou » Sun, Mar 22, 2020, 8:20 AM UTC

cc81 wrote: post #391

saiya-jin wrote: post #385

Earlier quoted context omitted.

For checking overall status without going into details? All doctors within given hospital have this kind of access here. 'Many countries' sounds rather like very few for this case, aren't you thinking US specifically?

It is as tough in Sweden, doctors and nurses have of course access to patient files but every access is logged and if someone is caught accessing files about a patient they are not working with they will be reprimanded or fired.

The last thing hospitals want to do right now is to fire doctors.

Re: Effect of economic crisis on America’s small businesses [slides]

#477

Post by vkou » Sun, Mar 22, 2020, 8:28 AM UTC

lend000 wrote: post #329

testfoobar wrote: post #38

The virus is terrible. But our solution could turn into an economic catastrophe. It simply isn't possible to shut down the economy and then pay people, businesses to sit idle for an undetermined amount of time. The solution is aggressive, continuous testing so that people can feel safe going back out. 1. Make hundreds and millions of the rapid tests available. 2. Deploy them to every business, every institution. 3. T…

Not to mention it isn't really solving the virus situation in most implementations. For example, everybody is packed into the local supermarkets at the same time in my area. Not only is there higher density due to closed restaurants, but also due to reduced hours (somebody thought curfews were a good idea). In their panic, people want "something" to be done. In a couple years, we will be talking about how 90% of poli…

> 90% of policies enacted during this crisis were a net negative

Compared to what? An exponential explosion, like what we saw in Italy, prior to the measures, but ten times worse, because you don't even do anything to check it?

Re: Effect of economic crisis on America’s small businesses [slides]

#478

Post by vkou » Sun, Mar 22, 2020, 8:30 AM UTC

stjohnswarts wrote: post #407

testfoobar wrote: post #38

The virus is terrible. But our solution could turn into an economic catastrophe. It simply isn't possible to shut down the economy and then pay people, businesses to sit idle for an undetermined amount of time. The solution is aggressive, continuous testing so that people can feel safe going back out. 1. Make hundreds and millions of the rapid tests available. 2. Deploy them to every business, every institution. 3. T…

I suspect after 1 or 2 months people will say enough is enough and force their reps to call off the quarantine. We can't do this for 18 months.

And then 3 weeks later, they'll say enough is enough, and beg for it back.

Re: Effect of economic crisis on America’s small businesses [slides]

#479

Post by edanm » Sun, Mar 22, 2020, 9:14 AM UTC

digitaltrees wrote: post #425

edanm wrote: post #411

Earlier quoted context omitted.

> If companies don’t behave responsibly they should lose that privilege and the owners could be held liable for debt and these kinds of mistakes personally. What mistakes? Is it a mistake to not keep a rainy day fund that will allow a company to weather a once-in-a-hundred-years shutdown of the entire economy? If this turns out to last a year, will you think it's a mistake that companies didn't keep a year's worth of…

My analysis was in response to and in the context of large companies conducting stock buy backs which is in no way related to the position SMBs find themselves. So yes, those buy backs were mistakes. In the last 20 years we have had at least 3 “once in 100 years events”, so yes, maybe corporations should be required to be more prepared for down turns as a condition of being granted the right to operate with limited l…

> My analysis was in response to and in the context of large companies conducting stock buy backs which is in no way related to the position SMBs find themselves. So yes, those buy backs were mistakes.

Fair enough - I was mostly talking in the context of the article (SMBs).

And to be frank, it sounds like you're much more knowledgeable about this issue than I am, certainly in terms of actual practice.

That said, I still disagree with you and not sure why you arrived at your conclusion.

Let's put aside for a second the question of whether shareholder primacy is good social policy or not in the general case - and I agree with you here - it's not mandated by law, and even if it were, we could change that if we decide it's bad policy.

Your specific contention here is that companies are using buybacks to prop up their share price, and thus are reducing their reserves. And that they should keep more reserves around.

So firstly - tax structure aside, I've never understood why anyone treats buybacks differently than dividend payments. It's just a way of giving money back to shareholders. Do you agree with that or not?

Secondly, how much reserves should a company actually keep? If this situation/recession drags on for a year, will you be saying that it's bad that companies didn't keep a year's worth of reserves? Two years?

I think that's both an unrealistic demand, and a supremely inefficient one. No company could've, nor should've, had to predict this kind of disaster happening, and been prepared for it. I'm generally a libertarian, but this is exactly the reason we have governments - this kind of crisis should be prevent by the government - both in terms of preventing a pandemic in the first place, and in terms of fixing the economy once we're in this situation.

In other words, I don't see any good way to change the market to incentivize companies to keep tons of cash lying around as a rainy day fund - and I don't think it would make sense for so many companies to hoard so much money. Much better to have them return the money to shareholders, to go invest in new companies.

Where do we disagree?

Re: Effect of economic crisis on America’s small businesses [slides]

#480

Post by senordevnyc » Sun, Mar 22, 2020, 10:06 AM UTC

zaroth wrote: post #473

senordevnyc wrote: post #438

Earlier quoted context omitted.

I can’t believe you’re still here spouting off your half-baked opinions on this pandemic. A few weeks ago you were all over this site proclaiming this as overblown and no big deal. At what point will you admit that you have no idea what you’re talking about, and that you represent an extremely dangerous and irresponsible mindset that will ultimately cost millions of lives? Seriously, you have zero expertise and you’v…

I stand by every comment I’ve made. None of which included personal attacks. Most of which included citations. Your personal attack is entirely inappropriate. I suggest perhaps it’s you that should take a break from the discussion. As we can see just looking at how different countries have responded, there is a wide spectrum of responses, and countries have been successful getting R0 below 1 with different approaches…

I stand by every comment I’ve made.

I’m not the least bit surprised.

Yes, my attack is personal, in the sense that it’s aimed directly at you and your reckless disregard for people’s lives. You’re spreading dangerous and false ideas in the face of a global pandemic, ideas that will cost tens of millions of lives if people take them seriously. There’s no reason anyone should listen to you, since you have no expertise, you’ve been wrong about everything all along, and you continue to disagree with the experts, as you have all along.

But like you said, you stand by every statement you’ve made.