Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Long-Term Stock Exchange Opens for Business

blog.ltse.com

Post reply on HN
Print view View original

311–320 of 561 posts

Re: The Long-Term Stock Exchange Opens for Business

#311

Post by ethbr0 »

nicoburns wrote: post #83
ethbr0 wrote: post #60

Earlier quoted context omitted.

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.

Not all businesses are productive. Look at a few decades of Japanese economic history.

If capital is tied up in a failing business that's pursuing a "long term strategy," then it's not freed for new businesses.

SpaceX and Tesla (to name two HN faves) probably wouldn't exist had PayPal retained more of its capital.

Re: The Long-Term Stock Exchange Opens for Business

#312

Post by rytill »

terminalcommand wrote: post #304
rytill wrote: post #297

Earlier quoted context omitted.

You don’t have any key ideas that you can express without linking to “hundreds of pages of legal filings”? His claims are not odd at all, you really haven’t put any effort into distilling the incentive design. It’s not impossible to express complex incentive design or push readers in the right direction to understand this. What is the essence of what is quantitatively or contractually different about LTSE?

The first link seems to be a 14-page memo and the second link a 28-page marketing document. As someone who writes these docs for a living, don't be afraid to read the legal stuff. It's just text.

I’m more flummoxed by the suggestion that expressing the basic idea concretely would be too hard than I am scared of reading a legal document.

Re: The Long-Term Stock Exchange Opens for Business

#313

Post by Terr_ »

qeternity wrote: post #299
tomhoward wrote: post #20

Earlier quoted context omitted.

The pressure comes from investors. (The board is elected by shareholders, so in theory they represent the wishes of investors). It's extremely difficult/rare to find investors who will just sit back and trust the CEO run the company as they see fit, particularly in a world where "unicorns" are going from zero to $billions in a few years. It happens occasionally, but only in the case of extreme outlier companies where…

I don't know why people continuously repeat this narrative. Two of the largest companies in the world, and in the history of humankind, are constantly marched higher by this "shortsighted" investor base: AMZN and TSLA. People say companies pursue short-term gains but in reality they just mean they pursue things they disagree with. And herein lies the dirty secret: professional investors aren't short-sighted, they jus…

> Two of the largest companies in the world

Survivorship bias?

Re: The Long-Term Stock Exchange Opens for Business

#314

Post by edoceo »

eries wrote: post #221
dangerface wrote: post #209

> adopt corporate governance that aligns their behavior and incentives to the long term. What does this mean? What quantitive measures are you using to qualify long term incentives and behaviours? No offence but you don't seem to have an answer to this question. For example is RDSA long term? They have been around for ever and people will need cars and oils for the forseable future at least 10 years is this long term…

Leaving aside some of your odd claims, I’m happy to answer the question. Our definitions and standards are laid out in excruciating detail in our hundreds of pages of legal filings. Here’s a good place to start if you are interested: https://www.sec.gov/rules/sro/ltse/2019/34-86327.pdf Also this may be of some interest: https://longtermstockexchange.com/static/principals_for_lt_s...

The second link, shows this on the second page

""Long-term focused companies should measure success in years and decades and prioritize long-term decision-making""

So, maybe the short answer is that? And the longer answer is 28 pages laying out details.

Re: The Long-Term Stock Exchange Opens for Business

#315

Post by itsoktocry »

This seems like a wonderful idea that the world needs. But until I can see a list of companies that are "accepted", it's hard to know if it's all just lip service. There are a few companies in the tech sphere I can think of off the top of my head that many consider "long term thinkers" that others would consider nothing of the sort.

Re: The Long-Term Stock Exchange Opens for Business

#316

Post by bmcahren »

newbie789 wrote: post #303
eries wrote: post #270

Earlier quoted context omitted.

Good point: https://markets.cboe.com/us/equities/market_share/

I am kind of confused. Does this site have a list of the actual listings? Maybe I'm not navigating this cboe site correctly but that just looks like some numbers. Edit: For example if I wanted to invest in a business through LTSE today, is cboe how I would do so? What would my order flow look like?

I think you and I would need to lean on a Robinhood to do that. You can't walk up to NASDAQ / NYSE and perform a trade direct you need a broker.

Re: The Long-Term Stock Exchange Opens for Business

#317

Post by itsoktocry »

zbruhnke wrote: post #44

So excited to see this vision come together Eric. I honestly hope one day we're taking HMBradley public on the LTSE. I have never felt more aligned with a mission or a vision, Systematically allowing companies to take a long term view without being punished is what the market needs. Or put another way ... Adam Smith > Milton Friedman I cannot wait to see where this goes and the mechanics LTSE puts in place to help re…

>Systematically allowing companies to take a long term view without being punished is what the market needs.

Why is the default that companies are "punished" for long-term thinking?

I'd bet that there are far more cases of long-term investors "punished" in the public markets by short-term thinking executives than vice versa.

Re: The Long-Term Stock Exchange Opens for Business

#318

Post by qeternity »

Terr_ wrote: post #313
qeternity wrote: post #299

Earlier quoted context omitted.

I don't know why people continuously repeat this narrative. Two of the largest companies in the world, and in the history of humankind, are constantly marched higher by this "shortsighted" investor base: AMZN and TSLA. People say companies pursue short-term gains but in reality they just mean they pursue things they disagree with. And herein lies the dirty secret: professional investors aren't short-sighted, they jus…

> Two of the largest companies in the world Survivorship bias?

No, because the whole premise here is that investor behavior prevents this kind of bias. You can't take the whole argument and then cast massive, glaring contradictions to the core premise as merely bias.

Re: The Long-Term Stock Exchange Opens for Business

#319

Post by eries »

itsoktocry wrote: post #315

This seems like a wonderful idea that the world needs. But until I can see a list of companies that are "accepted", it's hard to know if it's all just lip service. There are a few companies in the tech sphere I can think of off the top of my head that many consider "long term thinkers" that others would consider nothing of the sort.

I'm as curious as you are to see what happens next...

Re: The Long-Term Stock Exchange Opens for Business

#320

Post by ajani »

eries wrote: post #262
jovial_cavalier wrote: post #247

Are there any incentive systems in place to ensure that companies being traded on your exchange don't take part in these destructive practices, or is it simply that they agreed to your policies? If it's the latter, I don't see why a company would opt to be traded on your exchange if they get literally nothing in return other than good boy points. I also don't understand why this is a problem you are tackling at the e…

Yes, there are incentives. But I object to your characterization of doing the right thing as "good boy points." Acting ethically and treating people right is its own reward _and also_ has been repeatedly shown to lead to outperformance. Our exchange works differently than the legacy players, so I don't really understand your last point.

The question still holds, which you didn’t really answer:

Are there any incentive systems in place to ensure that companies being traded on your exchange don't take part in these destructive practices, or is it simply that they agreed to your policies?

What are the incentives and how do you hold a company to a long term orientation. A company is free to choose and change its vision/strategy as time goes by. Do they get delisted if they move away from this orientation. How do you measure such an intangible and act on it?

Post reply on HN