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The Long-Term Stock Exchange Opens for Business

blog.ltse.com

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Re: The Long-Term Stock Exchange Opens for Business

#81

Post by hchz »

jsdavo wrote: post #41
gogopuppygogo wrote: post #35

Earlier quoted context omitted.

Bezos was an investment banker. Before he had the track record of long term development (only born from long term efforts) he knew how to speak Wall Street and had a track record on Wall Street. Most CEO’s will never be capitalized like him for long term empire building so it’s hard to say there couldn’t be more Amazon sized successes out there if Capital was more accessible for longer term visions.

Wait, I thought Bezos was a quant, not an investment banker?

He worked at bankers trust, but not as a banker, and then at a quant hedge fund, but not as a quant.

Re: The Long-Term Stock Exchange Opens for Business

#82

Post by spelunker »

asaph wrote: post #76

How do I create an LTSE account and start investing? I went to https://ltse.com/ , clicked on the menu and selected "Exchange". But I only see marketing material. Update: I found the Sign In/Sign Up URL: https://account.ltse.com/

You'll probably need to go through a broker - you don't buy directly from the other exchanges like NASDAQ either. If/when any brokers are on board I'm sure LTSE will be sharing that information.

Re: The Long-Term Stock Exchange Opens for Business

#83

Post by nicoburns »

ethbr0 wrote: post #60
nicoburns wrote: post #6

Earlier quoted context omitted.

I have no idea if this solves the problem, but I think the problem is shareholders. Specifically, a proportion of shareholders favour short-term profits, and those shareholders outcompete the long-term minded shareholders leading them to have greater influence over time. These short-term shareholders are extracting value at the expense of wider society, and it's a massive problem.

On the other hand, short-term shareholders, inasmuch as they prefer returned capital, are then freed to invest in other businesses. If PayPal et al. had retained profits in the business for a long term goal, a substantial number of innovate companies couldn't have formed. The more nuanced problem is likely that short-term and long-term shareholders' goals are mutually exclusive . That is, there is a rarely a strategy…

> On the other hand, short-term shareholders, inasmuch as they prefer returned capital, are then freed to invest in other businesses.

I'm not sure that's a benefit if they then destroy those businesses too.

Re: The Long-Term Stock Exchange Opens for Business

#84

Post by thursday0987 »

mistrial9 wrote: post #46
dcolkitt wrote: post #29

Earlier quoted context omitted.

I'll give a shareholder's perspective. Management, when left unchecked, frequently engages in in wasteful empire building and prestige projects. The most apparent manifestation of this is in mergers and acquisitions. Decades of evidence shows that the median merger destroys shareholder value for the acquiring company. Imposing strong controls on corporate management is one of the most important thing that shareholder…

"go off the reservation" .. I suspect that my father many decades ago engaged in casual references like this, but I recall as a child that it was frowned upon by people who sought to reset and build positive relations between races in North America

way to derail the conversation.

or is "derail" also a phrase that you are against because native americans used to literally derail trains back in the day?

Re: The Long-Term Stock Exchange Opens for Business

#85

Post by [deleted] »

jayd16 wrote: post #78
mikepurvis wrote: post #63

Earlier quoted context omitted.

Not the parent, but it's obvious what the origin of the phrase is, and while it may not be as icky as something like "open the kimono", it's definitely one that is trivially replaced with no loss in meaning, and therefore almost certainly should be: "The issue with 'off the reservation' and similar phrases is that these things are said without any thought. They become a part of the common vernacular. Freely they move…

Is there some pejorative meaning to opening the kimono or is it just mildly lewd?

[deleted]

Re: The Long-Term Stock Exchange Opens for Business

#86

Post by JackFr »

nicoburns wrote: post #6
picodguyo wrote: post #3

"They described the immense pressure on companies to pursue short-term results over creating value for future decades and generations." Where does this pressure come from? The board? Can't you appoint a board that is long-term friendly? Institutional investors? Wouldn't the same investors interested in the LTSE also be interested in you on the traditional market if long-term is part of your DNA? Shareholders? Shareho…

I have no idea if this solves the problem, but I think the problem is shareholders. Specifically, a proportion of shareholders favour short-term profits, and those shareholders outcompete the long-term minded shareholders leading them to have greater influence over time. These short-term shareholders are extracting value at the expense of wider society, and it's a massive problem.

If you need money over the long term and you don't want to relinquish control, we have a thing called the bond market. Borrow for 5, 10, 30, heck, even 99 years and your interest is tax deductible! (Borrowing longer than 99 years the IRS may want to talk to you. Your bonds start to look like preferred stock.)

Wait -- the bond market won't lend to you cause they don't trust your ability to generate that return for the next 20 years? Go to the junk bond market -- they'll lend to you. In fact here's an idea go to the junk bonk market, and borrow money to take your company private -- out of the hands of those grubby short term shareholders.

Re: The Long-Term Stock Exchange Opens for Business

#87

Post by AznHisoka »

derivagral wrote: post #80
AznHisoka wrote: post #36

Earlier quoted context omitted.

The dividend is not based on their cashflow. So if Apple is paying 1% dividend on a $100 stock price, but their cashflows increase every year, they're still paying you $1 every year. What I'm suggesting is an exchange where the dividend is a fixed % of their cashflows. Let's say it's 1%. If their cashflow is 1 billion, then 1% of it goes to their shareholders. If it doubles the next year, then 1% of that 2 billion go…

As I understand it, the dividend is set typically in a dollar amount and the % is a metric derived from that. I agree that the figure is (usually) a bit nonsense. However, I don't think your phrasing is as clear as it could be. If Apple announces a 10% dividend with a 1T market cap that's $100b in distribution. If the market cap doubles to 2T later that year, that dividend payment isn't suddenly updated to $200b; it…

Yes, sorry I explained it incorrectly. That is the right explanation.

Re: The Long-Term Stock Exchange Opens for Business

#88

Post by sokoloff »

dcolkitt wrote: post #29
picodguyo wrote: post #3

"They described the immense pressure on companies to pursue short-term results over creating value for future decades and generations." Where does this pressure come from? The board? Can't you appoint a board that is long-term friendly? Institutional investors? Wouldn't the same investors interested in the LTSE also be interested in you on the traditional market if long-term is part of your DNA? Shareholders? Shareho…

I'll give a shareholder's perspective. Management, when left unchecked, frequently engages in in wasteful empire building and prestige projects. The most apparent manifestation of this is in mergers and acquisitions. Decades of evidence shows that the median merger destroys shareholder value for the acquiring company. Imposing strong controls on corporate management is one of the most important thing that shareholder…

> Decades of evidence shows that the median merger destroys shareholder value for the acquiring company.

As an investor, I care more about the total (sum of average) returns of mergers, not the median. Just like in venture capital (where the median investment is clearly negative), the total return matters and is driven by the large returns on success.

I'd still be happy to invest in Berkshire Hathaway in 1955 even if you told me that their median merger over the next 60 years would be value destroying (so long as the average would turn out the way it has).

Re: The Long-Term Stock Exchange Opens for Business

#89

Post by jl2718 »

vikramkr wrote: post #53
dcolkitt wrote: post #29

Earlier quoted context omitted.

I'll give a shareholder's perspective. Management, when left unchecked, frequently engages in in wasteful empire building and prestige projects. The most apparent manifestation of this is in mergers and acquisitions. Decades of evidence shows that the median merger destroys shareholder value for the acquiring company. Imposing strong controls on corporate management is one of the most important thing that shareholder…

Management left unchecked just does what they're incentivized to do. You can't pass on the blame as shareholders when shareholders create incentive packages that reward getting a bonus today for an acquisition instead of not really getting paid for sustainably growing the business over the next decade.

Share loans are a really simple way to align incentives. Execs get shares loaned with interest at market value, and can’t sell faster than the loan repayment schedule of 20% per year after the end of tenure. Some other rules apply like dividends can’t be paid from a negative value loan. Sure, option incentive packages try to approximate this, but they can’t legally capture the downside like a loan can.

Re: The Long-Term Stock Exchange Opens for Business

#90

Post by R0b0t1 »

mistrial9 wrote: post #46
dcolkitt wrote: post #29

Earlier quoted context omitted.

I'll give a shareholder's perspective. Management, when left unchecked, frequently engages in in wasteful empire building and prestige projects. The most apparent manifestation of this is in mergers and acquisitions. Decades of evidence shows that the median merger destroys shareholder value for the acquiring company. Imposing strong controls on corporate management is one of the most important thing that shareholder…

"go off the reservation" .. I suspect that my father many decades ago engaged in casual references like this, but I recall as a child that it was frowned upon by people who sought to reset and build positive relations between races in North America

I did not see any racial connotations when I read this, let alone any negative ones.
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