The Real Roots of Hedge Fund Manager Rage

[LAM]

http://www.propublica.org/thetrade/item/the-real-roots-of-hedge-fund-manager-rage

 

[Bowden]

Interesting article.

Ties into why income inequality is increasing, why wages and benefits for the middle class have been stagnant for years and why the working poor wages are so low and benefits are so poor.

"But companies haven't been investing and wages are stagnant. Instead, corporations have spent the postcrisis years engaged largely in financial engineering. The largest United States corporations took 91 percent of their earnings from 2003 to 2013 and plowed them into buying back their own stock or paying out dividends, according to William Lazonick, an economist at the University of Massachusetts Lowell."

"There has been a corporate shift from making investments for the long-term health of the company and the economy toward cutting jobs and elevating share prices, with the end result of increasing top executives' compensation, Professor Lazonick says. Nobody can say how long this can go on. But it's not sustainable."

 

[heckler7]

feels like our country's finances are run by dave and busters, we keep purchasing their currency to play their games

 

[Swiper]

"Nobody can predict how long governments can get away with fake growth, fake money, fake jobs, fake financial stability, fake inflation numbers and fake income growth," he wrote. Some commenters think the economy is improving, but he wrote, "We do not think this optimism is warranted, and we think a lot of the data is cooked or misleading."

agree

 

[LAM]

Interesting article.

Ties into why income inequality is increasing, why wages and benefits for the middle class have been stagnant for years and why the working poor wages are so low and benefits are so poor.

"But companies haven't been investing and wages are stagnant. Instead, corporations have spent the postcrisis years engaged largely in financial engineering. The largest United States corporations took 91 percent of their earnings from 2003 to 2013 and plowed them into buying back their own stock or paying out dividends, according to William Lazonick, an economist at the University of Massachusetts Lowell."

"There has been a corporate shift from making investments for the long-term health of the company and the economy toward cutting jobs and elevating share prices, with the end result of increasing top executives' compensation, Professor Lazonick says. Nobody can say how long this can go on. But it's not sustainable."

And that's exactly why AT&T is the largest and most profitable telecommunications company in world history yet the infrastructure in the U.S is ranked 15th in the OECD and why our download rates are much slower then carriers in the EU and the offer services at 50-75% less then U.S carriers. And why Net neutrality is such a big deal.

But this is all carry over from the fuck stick Milton Friedman and his maximizing shareholder value (MSV) from the 1970's. It wouldn't be such a problem it it were just a coupe of large firms and U.S MNEs but they all behave the same now and now we have the negative aggregate effect of that on wages and the economy.