In most cases, you are granted a notional dollar amount that is immediately turned into a concrete and fixed number of shares that then vest over the next 4 years.
Then, any share price appreciation on the shares is captured by you at vesting, rather than being paid in cash (the value of which has been inflated away) and then purchasing shares/index that has risen in the last 1-4 years.
If you are paid in cash, you will be buying fewer shares per dollar (and per year) rather than getting the same number.
Right, but cash compensation could be structured the same way, minus whatever would be settled on for the retention value to the employer of the vesting schedule.
I get your point. The value of stock isn’t that it’s stock per se, but rather that it’s inflation-resistant even when illiquid.
I've known a few people who lost everything when the company went bankrupt. (most died of old age when I was a kid - before pension reform companies often did put your retirement in the company stocks)
We are bottlenecked at energy supply, not running hot via demand. Raising rates is likely to stifle already weak sections of the economy. Additionally, we are getting into territory where raising rates threatens our own ability to pay our debt.
Just to be clear, I am not coming at this from some anti-interventionist or anti-monetary tool standpoint. It's just that demand side tools seem like the wrong lever for the job. We are backing slowly into the corner of persistent inflation or structural failure of some kind.
What advantages does that have over taking your paycheck 100% in cash and investing in index funds?
In most cases, you are granted a notional dollar amount that is immediately turned into a concrete and fixed number of shares that then vest over the next 4 years.
Then, any share price appreciation on the shares is captured by you at vesting, rather than being paid in cash (the value of which has been inflated away) and then purchasing shares/index that has risen in the last 1-4 years.
If you are paid in cash, you will be buying fewer shares per dollar (and per year) rather than getting the same number.
Right, but cash compensation could be structured the same way, minus whatever would be settled on for the retention value to the employer of the vesting schedule.
I get your point. The value of stock isn’t that it’s stock per se, but rather that it’s inflation-resistant even when illiquid.
Because I get way more money.
hope you dont work for salesforce
I've known a few people who lost everything when the company went bankrupt. (most died of old age when I was a kid - before pension reform companies often did put your retirement in the company stocks)
If inflation due to energy costs is running hot they’ll have to raise rates which will cause stock prices to fall.
We are bottlenecked at energy supply, not running hot via demand. Raising rates is likely to stifle already weak sections of the economy. Additionally, we are getting into territory where raising rates threatens our own ability to pay our debt.
Just to be clear, I am not coming at this from some anti-interventionist or anti-monetary tool standpoint. It's just that demand side tools seem like the wrong lever for the job. We are backing slowly into the corner of persistent inflation or structural failure of some kind.