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No science, no startups: The innovation engine we're switching off

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Re: No science, no startups: The innovation engine we're switching off

#291

Post by BurningFrog »

twobitshifter wrote: post #48
terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

Not why it can’t be done so much as why it isn’t done. Share buybacks allow companies to reward executives directly as their compensation is tied to stock price. If we started not doing that, the priorities might shift, but those executives like things the way they are. Before Tim Cook Apple had never done a buyback - Jobs was always thinking Apple could do better with the money in R&D than paying off shareholders. W…

Share buybacks is not some weird loophole that allows executives to get paid.

Companies are always allowed to reward their executives and other employees by giving them money, stock options, or other rewards.

Re: No science, no startups: The innovation engine we're switching off

#292

Post by smaudet »

twobitshifter wrote: post #48
terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

Not why it can’t be done so much as why it isn’t done. Share buybacks allow companies to reward executives directly as their compensation is tied to stock price. If we started not doing that, the priorities might shift, but those executives like things the way they are. Before Tim Cook Apple had never done a buyback - Jobs was always thinking Apple could do better with the money in R&D than paying off shareholders. W…

Maybe some of these 2-brain cell executives should consider that their "buybacks" will be worthless when US throughput starts to be equally worthless compared to the rest of the world...

Of course, I'm being a bit pejorative, they aren't thinking big picture at all, just concerned with what happens tomorrow not the day after...

However, they are in part responsible for the nonsense happening at the moment wrt to American policy, it seems like a game who can light cash on fire the fastest ..

Re: No science, no startups: The innovation engine we're switching off

#293

Post by bloppe »

epistasis wrote: post #269
fidotron wrote: post #64

There's something odd in this argument. If you come at it from a Canadian perspective Canada seriously spent on neural network computer science when almost no one else did (many in AI considered the entire thing discredited and impossible), now the (financial) gains from that are almost entirely in a foreign country. The US science establishment was all about buying and utilizing Russian rocket engines until he-that-…

"Seriously spent" where serious is less than the cost of a single bomber for the military. I forget what Geoffrey Hinton said it was, but it was an embarrassingly small pittance. Military spending is largely economic dead weight, roughly the equivalent of handouts. And the end result is deterrence in a game of prisoners dilemma. Yet it is sacrosanct, and subject to ever increasing budgets for no gain.

Just look at all the handouts going to Ukrainian soldiers right now. What silly economic dead weight!

Re: No science, no startups: The innovation engine we're switching off

#294

Post by jibal »

nyeah wrote: post #180
lotsofpulp wrote: post #173

Earlier quoted context omitted.

What does that even mean? Both stock buybacks and dividends are the distribution of profit. Compensation expenses (such as stock options, RSUs, etc) are accounted as expenses, which of course reduces profit.

[flagged]

> Here's what you said

Different person.

Re: No science, no startups: The innovation engine we're switching off

#295

Post by BurningFrog »

triceratops wrote: post #187
RandomLensman wrote: post #114

Earlier quoted context omitted.

What is your definition of "benefit"? Assuming a buyback increases share prices, why would shareholders in general be indifferent?

Because if I don't intend to sell right now, and the company is otherwise a healthy, going concern that can pay sustainable dividends, the actual share price is irrelevant to me. If anything, given my belief in the company, a lower share price is better. I can buy more shares!

Having been in the "don't intend to sell right now" situation for decades, the actual share price movements were always very relevant to me.

I'm confident I share that psychology with almost everyone.

Re: No science, no startups: The innovation engine we're switching off

#296

Post by wombatpm »

bayindirh wrote: post #57
oblio wrote: post #45

Earlier quoted context omitted.

Xerox and Kodak, at least, stumbled into the future and then refused it. The same thing will happen to Google & co. And DuPont is very much alive doing DuPont things.

...and there's 3M and Würth.

The story with 3M and PostIt Notes is that the idea was originally rejected my management. The inventors created a batch and distributed them to all the executive admin assistants. When they went back a second time, they had the assistants speak up otherwise there would not be any more.

Re: No science, no startups: The innovation engine we're switching off

#297

Post by astrange »

triceratops wrote: post #193
fn-mote wrote: post #98

Earlier quoted context omitted.

Can you make this argument more rigorous? I’m just not following the connections here. It seems like your assumption is that a stock buyback is a short term gain. One of your arguments is that the strike price for options is set based on a certain amount of stock in circulation, and decreasing that amount will “artificially” raise the stock price, making the options more valuable. I agree that higher stock price bene…

> It seems like your assumption is that a stock buyback is a short term gain. My argument is a stock buyback isn't a gain for a long-term, buy-and-hold investor. Unless a) they sell some of the stock or b) it pays dividends they don't see the benefit of a higher stock price or reduced share count. Qualified dividends and long term capital gains are taxed at the same rate. So anyone who says "buybacks are more tax-adv…

> they don't see the benefit of a higher stock price or reduced share count.

If they're continually investing/rebalancing then it benefits them the same way a dividend does, but with fewer tax consequences.

Re: No science, no startups: The innovation engine we're switching off

#298

Post by uolmir »

rapatel0 wrote: post #242
ilamont wrote: post #115

Universities spend ~$109 billion a year on research. ~$60 billion of that $109 billion comes from the National Institutes for Health (NIH) for biomedical research, National Science Foundation (NSF) for basic science, Department of War (DoW), Department of Energy (DOE), for energy/physics/nuclear, DARPA, NASA. Let's talk about the other $49B. I read or heard someplace that at many universities tuition paid by students…

> I read or heard someplace that at many universities tuition paid by students in the social sciences is effectively subsidizing the STEM fields I'm very skeptical of this claim. In fact up until a recent funding method change from the Trump Administration, most grant money was subject to "overhead"--a nebulous nonsensical accounting trick that allowed the university administration to get upwards of 60% of the dollar…

> In fact up until a recent funding method change from the Trump Administration, most grant money was subject to "overhead"--a nebulous nonsensical accounting trick that allowed the university administration to get upwards of 60% of the dollars that are earmarked for grants.

We're better than this here. Don't spread misinformation. First of all overhead is listed as a percentage, such as 55% or 60% or whatever but the university doesn't get that fraction of the total grant. You work up the so called direct costs, ie the line item salaries of the researchers, the reagents, etc. and then the overhead is 60% of that figure. So it would work out to be 38% of the total dollars granted.

It's also not a trick. It's a negotiated amount that is supposed to avoid each grant requesting some amortized fraction of the cost of office space and other necessary but shared expenses.

I and most people agree that's it's possibly too high, but it's ignorant to treat it like a scam.

Re: No science, no startups: The innovation engine we're switching off

#299

Post by astrange »

BurningFrog wrote: post #295
triceratops wrote: post #187

Earlier quoted context omitted.

Because if I don't intend to sell right now, and the company is otherwise a healthy, going concern that can pay sustainable dividends, the actual share price is irrelevant to me. If anything, given my belief in the company, a lower share price is better. I can buy more shares!

Having been in the "don't intend to sell right now" situation for decades, the actual share price movements were always very relevant to me. I'm confident I share that psychology with almost everyone.

Stop looking.

Well, "don't sell" is the wrong strategy anyway. Trade it in for an index fund.

Re: No science, no startups: The innovation engine we're switching off

#300

Post by ModernMech »

IG_Semmelweiss wrote: post #287
ModernMech wrote: post #257

Earlier quoted context omitted.

Yeah, that's not really how I view central planning. To me, central planning is when decisions go through a central authority. The only thing centralized here is the money pot. The decision making about what gets funded is mostly distributed though. Yes the Trump administration is wielding influence but the way they are doing it is by exerting control over the purse strings, which is decidedly not constitutional. Ind…

>>>The grant committees didn't earn the money, but as practicing scientists of some renown they have earned the right to weigh in on how public dollars should be spent. No. They have not. They haven't earned anything. If they did, they would have had a connection to a company and thru their technical expertise, chosen exactly what to develop next, with their own (or investor's) dollars at stake. You can't claim the b…

> chosen exactly what to develop next, with their own (or investor's) dollars at stake.

We are talking about fundamental research here. Most investors are not interested in funding fundamental science, evidenced by the fact they have all the power to currently fund such work, but they choose not to.

> You can't claim the best at a subject and purport to demonstrate it by writing a book

They don't, they do it by doing science and building a reputation in their field for doing good work. People who work at the NSF and NIH are vouched for by others in their field.

> Real risk managers open hedge funds. Academics write about other's hedge funds.

The interests of private equity and hedge fund managers are well represented. They have plenty of say on public policy and how resources are allocated. It's good to give other people with different perspectives a say as well. Again, the total amount of money allocated for public research is very tiny compared to the rest of the federal budget, private research dollars, total hedge fund wealth, etc.

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