141–150 of 314 posts
Companies are man made so the have a limited live span. There is no exception, every man made organisation will end. While this is sad for every single case, the finitnes is a good thing at all.
Thinking on finitnes of companies, stock market indexes have a mathematical limit.
Earlier quoted context omitted.
Because selfish behavior is still wrong even if it's incentivized by a system.
I don’t believe that looking out for one’s own interests (“selfish”) is wrong. My dad taught me a valuable lesson as a child- the world owes you nothing and as long as you understand that you'll be fine. I take that to mean that nobody else will look out for you so you have to do what's best for you. In my situation, my employees profited nicely from a PE acquisition. They all got a sizeable transaction bonus. Not on…
For certain, groups where individuals all act in their own self interest sometimes come up with the best solutions for everyone. It bothers me that people believe either maxim must always be true for all circumstances. (this is effectively socialism vs. libertarianism) It seems very clear to me that each camp has supporting examples, and that there are very few universal maxims.
Getting back to the main point, I think there have been many instances were selfish private equity has made things worse for people, which does not discount instances where it has made things better.
Earlier quoted context omitted.
I’ve been shocked to the extent politicians haven’t focused on the lost tax revenue from the gig economy. I’m certain it’s caused a drop in tax revenue from what would normally constitute middle class tax payers.
What lost tax revenue do you mean? Self-employed/temp/gig workers still pay the same taxes as full time employees.
So you might actually see increased revenues as a result.
Decent question though.
Earlier quoted context omitted.
I love the term financial engineers. In my head, it defines the person, the procedure, and the purpose.
The problem with engineers (speaking as one myself) is that we're prone to focusing only on the mechanism itself, abstracting away the details and ignoring the parts of the system we can ignore. In software we can often get away with this because the rest of the system is just further machinery; there are benefits to taking it into consideration, sure, but nobody gets hurt when you don't. But business and finance are…
Earlier quoted context omitted.
The problem with engineers (speaking as one myself) is that we're prone to focusing only on the mechanism itself, abstracting away the details and ignoring the parts of the system we can ignore. In software we can often get away with this because the rest of the system is just further machinery; there are benefits to taking it into consideration, sure, but nobody gets hurt when you don't. But business and finance are…
I know and I agree. And a software engineer is much different than a mechanical engineer or a civil engineer. I guess I should’ve mentioned that the term financial engineer gives me context or a reference point where I can see that they are behaving like engineers. My comment was more focused on their behavioral mechanisms.
Earlier quoted context omitted.
Why is it _wrong_ for owners to do what’s best for them? Most people don’t own a business as a charity- they own it to make money. If a PE acquisition is the best path to a lucrative exit, why shouldn’t they do it?
Why is it wrong to hurt other people for your benefit? If you are an alien learning about humans, you should start with some children's books. I think you're missing some pretty fundamental knowledge here
What I'm hearing you say is that once a founder starts a business and hires a single employee they must operate that company until death. That seems like a ridiculous position to me and perhaps you're missing some fundamental knowledge on life. If that were somehow codified to law, I would've never started a business.
Earlier quoted context omitted.
Both of these things can be true: that the top 1% own a large fraction of wealth, and that an even larger fraction is owned by the pensions and retirement plans of the non-wealthy. Wealth comparisons are tricky, e.g they'll show that Americans are some of the poorest people in the world because there's a large fraction with debt (e.g homes, credit cards, student loans). While technically true, that doesn't really mat…
Well then our intuition is wrong. If your finances throughout your life are not in order, if you have high debt, regardless if it's because of medical bills, student loans or too big a car and house, you are in a weak position. What good does a nice car do if you worry about bills and if you try to avoid to look at the balance in your banking app? You don't always know how rich some folks are, but for the most part i…
John lives in extreme poverty. He's debt free, but is unable to adequately feed himself or his family. Several of his children have died from malnutrition.
Marc lives in a nice suburban home, has 3 square meals a day, so does everyone in his family. However, his debts (including his mortgage, car payments, student loans) exceed his savings.
If our intuition is wrong, then John is winning. He's ahead of Marc financially.
But I can tell you which one of them I'd rather be. It's not John.
Earlier quoted context omitted.
As a firearm enthusiast, the answer to "How many guys does one need?" is always "Just one more." It's a fun hobby that I can spend time with my kids. They also make great investments as a quality firearm holds it worth and often increases in value.
Yeah, take any hobby or sport or whatever that involves "gear" of some sort, and you'll get some variation of the old saw: "The correct number of $ITEM to own is n +1, where n is the number you own now." $ITEM can be "mountain bikes", "guitars", "road bikes", "motorcycles", "guns" or pretty much anything.
Earlier quoted context omitted.
I get that money is money, but I feel like we desperately need to make conflict of interests prosecutable, so we can kill the self-serving mess that are LBOs. In what universe is "I borrow a bunch of money, buy a company, then force the company to basically borrow money from me" a value-creating operation? Cuz it sure isn't this one.
The alternative to leveraged buyouts is probably not a healthy company, it's more likely a slowly dieing company that goes out with a whimper, not a bang. Is one way better than the other?
The part I don't get is how Cerberus made money. It seems like it was a zero-sum for Cerberus. They loaned the holding company 225M, and presumably got that money back through the holding buying the stock back from Cerberus after the holding sold the 11% corp. bonds. Is it that between when the holding bought the stock back from Cerberus and Cerberus (via the holding) sold the bonds Cerberus had control of Remington…
Cerberus is then out of the transaction with $225M - $118M. Remington + S (which Cerberus no longer owns) has $252M + $225M in debt.