Comments on: Greedy Management and the Decline of Equity Returns http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/ Investing and Personal Finance Fri, 12 Mar 2010 21:37:33 -0500 http://wordpress.org/?v=2.9.2 hourly 1 By: Thicken My Wallet » Blog Archive » You are a fool if you buy… http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4244 Thicken My Wallet » Blog Archive » You are a fool if you buy… Fri, 07 Mar 2008 08:59:39 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4244 [...] share structure is there are no effective checks and balances to management excesses such as excessive executive compensation. My trader friend made an interesting observation during the Conrad Black criminal trial- the [...] [...] share structure is there are no effective checks and balances to management excesses such as excessive executive compensation. My trader friend made an interesting observation during the Conrad Black criminal trial- the [...]

]]> By: Mr. Cheap http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4240 Mr. Cheap Thu, 06 Mar 2008 20:51:11 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4240 HeMan: Fair enough, although perhaps as a "young executive for a publicly traded company" you'll admit that you aren't the most unbiased person. I would prefer to invest in companies that have reasonable executive compensation. When/if enough investors care about this issue, the market will bring compensation back to a reasonable level. "Whining shareholders" are the company owners. You should consider working elsewhere if you don't like being accountable to the people who own the company you work at. Plop: I'm pretty happy with a 10% return. Power to you if you can consistently get more than this! HeMan: Fair enough, although perhaps as a “young executive for a publicly traded company” you’ll admit that you aren’t the most unbiased person.

I would prefer to invest in companies that have reasonable executive compensation. When/if enough investors care about this issue, the market will bring compensation back to a reasonable level.

“Whining shareholders” are the company owners. You should consider working elsewhere if you don’t like being accountable to the people who own the company you work at.

Plop: I’m pretty happy with a 10% return. Power to you if you can consistently get more than this!

]]> By: Plop http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4228 Plop Thu, 06 Mar 2008 02:48:58 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4228 The only guys making money on the market are the MM, and the guys on the inside. They'll give you your small cut to keep you interested (10% is a joke). I would rather invest in something more tangible that gives me a 30-40% return (like real goods). The only guys making money on the market are the MM, and the guys on the inside.

They’ll give you your small cut to keep you interested (10% is a joke). I would rather invest in something more tangible that gives me a 30-40% return (like real goods).

]]> By: HeMan http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4226 HeMan Thu, 06 Mar 2008 02:31:50 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4226 I guess the other point of view missing here is this: If you think you have the skills necessary to raise the capital, start a company and generate returns consistently above 10% while dealing with whining shareholders, stakeholders, environmentalists, politicians, and the like... then go ahead. If not, shut your yap and stop complaining about executive salaries. Obviously the market is approving this behaviour or everyone would sell their stock and start companies of their own with greater returns. Of course, this is just one point of view. I guess the other point of view missing here is this:
If you think you have the skills necessary to raise the capital, start a company and generate returns consistently above 10% while dealing with whining shareholders, stakeholders, environmentalists, politicians, and the like… then go ahead. If not, shut your yap and stop complaining about executive salaries. Obviously the market is approving this behaviour or everyone would sell their stock and start companies of their own with greater returns.

Of course, this is just one point of view.

]]> By: Four Pillars http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4214 Four Pillars Wed, 05 Mar 2008 02:37:54 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4214 Nobleea - very true. Alex - I'll have to check that out. I have a post on hedge funds coming up so you can give your opinion on it (or them). Mike Nobleea – very true.

Alex – I’ll have to check that out. I have a post on hedge funds coming up so you can give your opinion on it (or them).

Mike

]]> By: Alex Givant http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4212 Alex Givant Tue, 04 Mar 2008 17:55:09 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4212 Just finished "The Big Investment Lie: What Your Financial Advisor Doesn't Want You to Know" by Michael Edesess - excellent book. He is talking about high fees of mutual funds managers and even higher fees for hedge funds and why they bring nothing to your bottom line on the end. "Where is a customers yachts" - still the valid question. Just finished “The Big Investment Lie: What Your Financial Advisor Doesn’t Want You to Know” by Michael Edesess – excellent book.

He is talking about high fees of mutual funds managers and even higher fees for hedge funds and why they bring nothing to your bottom line on the end.

“Where is a customers yachts” – still the valid question.

]]> By: Nobleea http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4208 Nobleea Tue, 04 Mar 2008 15:50:22 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4208 By far, the most dangerous phrase to utter when it comes to investing (or financial stuff in general) is: "This time it's different..." ...P/E ratios don't matter any more. ...real estate will always go up due to . By far, the most dangerous phrase to utter when it comes to investing (or financial stuff in general) is: “This time it’s different…”

…P/E ratios don’t matter any more.
…real estate will always go up due to .

]]> By: Four Pillars http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/comment-page-1/#comment-4205 Four Pillars Tue, 04 Mar 2008 13:36:24 +0000 http://www.four-pillars.ca/2008/03/04/greedy-management-and-the-decline-of-equity-returns/#comment-4205 I still have to read that book. I was thinking of doing a post on executive compensation - a different look though so it won't be the same post! :) I still have to read that book.

I was thinking of doing a post on executive compensation – a different look though so it won’t be the same post! :)

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