I wonder if requiring it twice a month would fix both issues, since it's too frequent to plan around (versus quarterly), while frequent enough to allow transparency (versus annually).
> All the businesses with the highest demand for their shares are clearly not short-sighted.
Where is the proof?
As long as CEOs and executives compensation is tied to stock performance, which is highly tied to news and short term results, basic economics and game theory suggests that short-sightedness is indeed encouraged.
This is especially problematic for businesses where plannings have to be done 4/5/6+ years in advance like auto industry, aircrafts or semi conductors.
It takes an awful lot of time and money to plan a new processor architecture and build an ecosystem around it, from chip manufacturing to packaging.
Go down that list and you can see almost all those businesses are ones that plowed and continue to plow billions of dollars into investments that will not pan out for many years.
I don’t think any of the top ones got to where they were with quarter to quarter goals.
“Cashing in” is on bets made many years ago is making my point. Amazon didn’t stop once it had the book market or even the online retail market (see AWS), Apple didn’t stop with ipod or iphone (see M processors/Airpods/Watch/etc), Meta didn’t stop with Facebook (see instagram/whatsapp/VR), Alphabet didn’t stop with Google (Waymo, Gmail, Drive), Eli Lilly with GLP-1 trials, etc.
They could stop, and switch to quarter to quarter decision making and juice their numbers even more. Maybe they will, and then eventually those businesses will drop in the rankings (IBM/GE/etc).
But the idea that quarterly reporting makes businesses short sighted is clearly false.
Leaders with short term motivations makes businesses short sighted (obviously). Sometimes, that’s justified because the business sector is winding down, sometimes it’s due to incompetence, and sometimes it’s due to greed.
You know I can easily give you plenty of counter examples of decisions made for short term gains and stock pumping, right?
At the end of the day most of these CEOs are valued by the stock price and they need to follow investors expectations which are very often short sighted.
Intel, Boeing and countless others are obvious examples.
All the companies you listed went the "let's cut personnel or bets even if we're making gazzilions to appease the stock market".
> You know I can easily give you plenty of counter examples of decisions made for short term gains and stock pumping, right?
nonethewiser made the claim that if quarterly financials are required, then businesses will make short term decisions.
Disproving this only requires me to provide 1 example, although I provided quite a few examples of businesses that provided quarterly financials and still made long term decisions.
I never claimed that quarterly financials prevent short term decisions, so your counterexamples are disproving a claim I did not make.
> All the companies you listed went the "let's cut personnel or bets even if we're making gazzilions to appease the stock market".
It is possible for businesses to change from making long term decisions to short term decisions (and back), and it is also possible that cutting personnel was not done solely to appease the stock market due to fluctuations in demand for labor.
I wonder if requiring it twice a month would fix both issues, since it's too frequent to plan around (versus quarterly), while frequent enough to allow transparency (versus annually).
Where is the proof? All the businesses with the highest demand for their shares are clearly not short-sighted.
Share buyers are clearly rewarding investing for the long term, even with quarterly reporting.
> All the businesses with the highest demand for their shares are clearly not short-sighted.
Where is the proof?
As long as CEOs and executives compensation is tied to stock performance, which is highly tied to news and short term results, basic economics and game theory suggests that short-sightedness is indeed encouraged.
This is especially problematic for businesses where plannings have to be done 4/5/6+ years in advance like auto industry, aircrafts or semi conductors.
It takes an awful lot of time and money to plan a new processor architecture and build an ecosystem around it, from chip manufacturing to packaging.
https://companiesmarketcap.com/
Go down that list and you can see almost all those businesses are ones that plowed and continue to plow billions of dollars into investments that will not pan out for many years.
I don’t think any of the top ones got to where they were with quarter to quarter goals.
That's not proof of anything and most of the companies you find there are cashing on decades old businesses whether it's oil, ads or iPhones.
“Cashing in” is on bets made many years ago is making my point. Amazon didn’t stop once it had the book market or even the online retail market (see AWS), Apple didn’t stop with ipod or iphone (see M processors/Airpods/Watch/etc), Meta didn’t stop with Facebook (see instagram/whatsapp/VR), Alphabet didn’t stop with Google (Waymo, Gmail, Drive), Eli Lilly with GLP-1 trials, etc.
They could stop, and switch to quarter to quarter decision making and juice their numbers even more. Maybe they will, and then eventually those businesses will drop in the rankings (IBM/GE/etc).
But the idea that quarterly reporting makes businesses short sighted is clearly false.
Leaders with short term motivations makes businesses short sighted (obviously). Sometimes, that’s justified because the business sector is winding down, sometimes it’s due to incompetence, and sometimes it’s due to greed.
You know I can easily give you plenty of counter examples of decisions made for short term gains and stock pumping, right?
At the end of the day most of these CEOs are valued by the stock price and they need to follow investors expectations which are very often short sighted.
Intel, Boeing and countless others are obvious examples.
All the companies you listed went the "let's cut personnel or bets even if we're making gazzilions to appease the stock market".
> You know I can easily give you plenty of counter examples of decisions made for short term gains and stock pumping, right?
nonethewiser made the claim that if quarterly financials are required, then businesses will make short term decisions.
Disproving this only requires me to provide 1 example, although I provided quite a few examples of businesses that provided quarterly financials and still made long term decisions.
I never claimed that quarterly financials prevent short term decisions, so your counterexamples are disproving a claim I did not make.
> All the companies you listed went the "let's cut personnel or bets even if we're making gazzilions to appease the stock market".
It is possible for businesses to change from making long term decisions to short term decisions (and back), and it is also possible that cutting personnel was not done solely to appease the stock market due to fluctuations in demand for labor.