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

The Dumbest Idea In The World: Maximizing Shareholder Value

forbes.com

Post reply on HN
Print view View original

101–110 of 139 posts

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#101

Post by mhartl »

barrkel wrote: post #21
mhartl wrote: post #11

There is only one valid definition of a business purpose: to create a customer. No. The one valid definition of a business purpose is this: A business should do what the owners want it to do. Otherwise, the notion of ownership loses meaning. If the owners want to create lots of customers, they do that. If they would rather have a smaller number of highly profitable customers, they do that. If they want to create a ni…

Incorporation is a privilege granted by society; and property rights are never absolute. What you state is extremely individualistic, but it is unrealistic and naive for the same reason. I understand your exhortation, but it does not amount to an argument. For example, most large companies with broad shareholder bases have no owner interests that you can easily point to; the shareholder base has collective action pro…

I'm really just asserting a tautology: Business owners determine what their businesses should do. Given the current legal status of corporations, the question "What should a company do?" is not ethical in nature (ought); it is a matter of fact (is): companies can, within the constraints imposed by law, do whatever their owners want them to do. There are certainly salient ethical questions here—"Which laws should governments enforce to constrain businesses' behavior?", for example, or "If I want to benefit others, what should I have my business do?"—but they lie outside the scope of my original comment.

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#102

Post by zeteo »

alexqgb wrote: post #35
barrkel wrote: post #21

Earlier quoted context omitted.

Incorporation is a privilege granted by society; and property rights are never absolute. What you state is extremely individualistic, but it is unrealistic and naive for the same reason. I understand your exhortation, but it does not amount to an argument. For example, most large companies with broad shareholder bases have no owner interests that you can easily point to; the shareholder base has collective action pro…

This is a much more civilized response than my initial reaction, which was "go fuck yourself, mhartl". The reason for that indignation was, as you pointed out, the obvious truth that without society's extension of limited legal liability, there would be no business in the first place - or, at least, not one with the scale and structure of a publicly traded company. And no, society does not grant this liability protec…

"society does not grant [...] protection for free. Nor does it expect to get the short end of the deal. It [...] expects [its] stake to be rewarded [...] mhartl's implication [...] represents [...] arrogance [...] It is supremely egocentric [...]"

There is a certain amusement in seeing a lecture about what "society" surely thinks and expects from all of us followed up with accusations of arrogance and egocentricity.

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#103

Post by funthree »

beagle3 wrote: post #97
LearnYouALisp wrote: post #92

Earlier quoted context omitted.

By "our society", American society is meant, and what was said is true. It would be ignorant of history to say that this country's laws and founding documents did not draw much inspiration from the Bible.

The Bible ("Old Testament") ... in which King David does the most dishonorable thing possible, sends a man to die in war so he can have that man's wife -- and gets endless praise regardless? No wonder. Regardless of the inspiration, reality with its liberal bias favors the successful rather than the honorable. These concepts are not inherently incompatible, but way more often than not are, and always were.

You are wrong but I doubt you see it. At any point in our history that you look you have just cherry picked the outliers that uphold your opinion. Your original argument is largely blanketed statements, without diligence.

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#104

Post by Tycho »

alexqgb wrote: post #35
barrkel wrote: post #21

Earlier quoted context omitted.

Incorporation is a privilege granted by society; and property rights are never absolute. What you state is extremely individualistic, but it is unrealistic and naive for the same reason. I understand your exhortation, but it does not amount to an argument. For example, most large companies with broad shareholder bases have no owner interests that you can easily point to; the shareholder base has collective action pro…

This is a much more civilized response than my initial reaction, which was "go fuck yourself, mhartl". The reason for that indignation was, as you pointed out, the obvious truth that without society's extension of limited legal liability, there would be no business in the first place - or, at least, not one with the scale and structure of a publicly traded company. And no, society does not grant this liability protec…

Society, being an abstract entity, cannot articulate what it actually wants. What we know is at lawmakers have granted a certain condition of limited-liability to encourage enterprise. Everyone is aware of this limited liability and is free to trade with those who claim it as they see fit. There is no further debt to society and it's not a 'privilege.'

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#105

Post by mikeash »

forensic wrote: post #99
mikeash wrote: post #86

Earlier quoted context omitted.

Person A ignores his accuser. Person B murders his accuser and goes on with life. How exactly is B more accountability? As far as I know, Dick Cheney hasn't murdered any of his accusers.

It's not murder it's a duel. Big difference. Both duellists put their lives on the line. How many people in America right now would be willing to have a duel with Cheney? Hundreds if not thousands. That says something meaningful about his role.

I don't really see why a duel isn't a murder. Plenty of murderers put their lives at risk to kill. Just because the other guy agreed to it doesn't make it not a murder. I guarantee you that if I challenged somebody to a duel today and ended up killing him that I would go to jail for murder, and rightly so.

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#106

Post by [deleted] »

alexqgb wrote: post #35
barrkel wrote: post #21

Earlier quoted context omitted.

Incorporation is a privilege granted by society; and property rights are never absolute. What you state is extremely individualistic, but it is unrealistic and naive for the same reason. I understand your exhortation, but it does not amount to an argument. For example, most large companies with broad shareholder bases have no owner interests that you can easily point to; the shareholder base has collective action pro…

This is a much more civilized response than my initial reaction, which was "go fuck yourself, mhartl". The reason for that indignation was, as you pointed out, the obvious truth that without society's extension of limited legal liability, there would be no business in the first place - or, at least, not one with the scale and structure of a publicly traded company. And no, society does not grant this liability protec…

[deleted]

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#107

Post by GrowMap »

pge wrote: post #51

I agree with the overall viewpoint of the article, so just adding an observation on how we got here. Tying management compensation to shareholder value is a good idea; the problem is in the measurement of shareholder value. If the public markets were efficient, and market cap was an accurate reflection of value, the system would not be as broken as it is. The public markets have become a casino, where investors are o…

Has it ever occurred to you that whoever has the most money can manipulate stock prices so any investor is in not one of the insiders is a mark? It boggles my mind that so few investors realize the game is certainly rigged and they ARE going to consistently lose. Why not just go to a casino? There - at least theoretically - you know what the takeout is and can decide whether you get enough "fun" from your losses to make you think it worthwhile. Gambling is gambling and the house always wins.

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#108

Post by GrowMap »

tomjen3 wrote: post #44
xinjiang wrote: post #36

Earlier quoted context omitted.

Saying your business can do whatever it damn well pleases because you own it is like saying I can drive my car any way I want. Not so. Your actions affect others. You are using public infrastructure and there are rules. Move to an island where you can be all by your lonesome and run a business any way you want there.

First I see that you are new here, so welcome. That isn't much of an argument you are presenting though -- you could argue against a person being allowed to do anything based on that. The reason I can't drive a car the way I want is that it represents a clear and present danger to the health of third-parties. On the other hand running my business the way I want doesn't present a clear harm to others, so I can't.

"On the other hand running my business the way I want doesn't present a clear harm to others, so I can't."

I beg to differ. How corporations are run harms so many others that it amazes me that you would even say that. What about all the "down-sized" workers whose pensions were gutted and benefits taken away - or the workers who lose their lives because companies care more about the bottom line than they do about safety?

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#109

Post by beagle3 »

forensic wrote: post #100
beagle3 wrote: post #96

Earlier quoted context omitted.

I agree with you about how society should work - more shaming, harsher public response towards repeat offenders. I disagree about your rose tinted view of the past. We could both pick a few historical events that would support our conflicting view of the past. But I find it hard to take you seriously. Quotes from political speeches, from the likes of George Bush and the conservapedia? Are those supposed to be reliabl…

Jefferson is a poor source to you? Those quotes demonstrate the cache that the concept of honor had.

No. Quotes are in general a poor source, especially one line quotes which were probably taken out of context (I don't blame you for taking them out of context on purpose, but time is an important context for e.g. what "honor" actually means, as you agreed earlier on this thread).

If you trust quotes - Bush said "No new taxes" (and there were), Obama said he'll close guantanamo as soon as he goes into office -- he even signed such an order in his first month -- but guantanamo is still operating.

Quotes are PR. Actions speak louder than words. And the actions had always been to worship the successful, as in the examples I gave, the Cheney example you gave, and the Burr/Hamilton I wasn't even aware of.

Re: The Dumbest Idea In The World: Maximizing Shareholder Value

#110

Post by nl »

cwp wrote: post #91
mikeash wrote: post #85

Earlier quoted context omitted.

And I'm saying that the perception of "honorable" was obviously very different than what we would consider "honorable" to be today if murdering his accuser and getting away with it improved that perception.

Sigh. Yes, attitudes toward violence have changed. We don't have duels any more, and if we did, the winner would go to jail. Fine. What's interesting about the duel isn't that Burr killed Hamilton, it's that he took the risk of getting killed himself. The duel could easily have turned out the other way. Who would risk his life to protect his reputation today? Certainly not Dick Cheney.

It is worth noting that Burr was known as a violent man and a good pistol shot (unlike Hamilton). If he had been an honorable man he would have deliberately missed (which was common in duels).
Post reply on HN