How Executives Get Rich Making Poor Decisions | Cold Take
Added 2024-04-01 15:02:37 +0000 UTCThis week's episode of Cold Take is now available!
Comments
This was one of the better CTs (not that they are ever bad). Nice work!
Stephen B
2024-04-04 00:50:25 +0000 UTCThe past few Cold Takes were depressingly bleak. Frost, are you okay?
Jeroen Delcour
2024-04-02 16:12:18 +0000 UTCEnjoyed this break down. It makes me frustrated with publicly traded companies, but the video was exceptional.
Half Tangible
2024-04-02 08:23:06 +0000 UTCIf a company doesn't grow, or doesn't grow enough, that's not grounds for a lawsuit in and of itself. The case everyone points to as proof of this, or at the least the one I always hear about, wasn't actually about maximizing profit directly. Legal scholars have said over and over that there is no actual duty to maximize profits in the short term, only to act with duty of care and loyalty to the corporation. If someone has a good faith case that they believe that what they are doing is best for company, the business judgment rule pretty well keeps that intact. Unfortunately, this notion that corporations must always be as profitable as possible, regardless of the veracity of it, allow activist investors to make their short term profits at the expense of the corporation's, and society's, long-term health.
Sydney Schreckengost
2024-04-01 18:13:45 +0000 UTCIt's arguably obligatory for publicly traded companies. Fiduciary Duty is the key word. They have to act in the best financial interests of their investors, which has been interpreted in at least one court case to mean maximizing profits at the cost of all else. And they need to report profit quarterly, so if it ever doesn't grow in a given 3 month period, or doesn't grow enough, that can be grounds for a lawsuit. The stock market isn't the root of all evil or the only place where this happens, but it sure as hell institutionalizes the worst parts of capitalism that we all love to complain about even if we call it by different names. It's an institution rotten to the core that corrupts all it touches
Kyle E Johnson
2024-04-01 17:56:49 +0000 UTCThis touches on the biggest issue - quarter to quarter thinking is rampant, and so many of these things aren't happening because a company isn't profitable, or sometimes not even because it's not profitable enough, but because shareholders will view some incredibly stupid things as just as good, or even better, than actually having made money.
Sydney Schreckengost
2024-04-01 16:03:11 +0000 UTCThank you for making some sense of why these truly shitty releases and cruel layoffs keep happening
Mattezhion Zane Corgan Campbell
2024-04-01 15:19:31 +0000 UTC
