The economy has essentially been ruined by looting. People finding ways to strip out assets from companies.
Variations on this include private equity racking up debt and bankrupting companies. Executives doing stock buybacks to boost their options while hollowing out the company's resources. Hedge fund management fees. It's everywhere.
PMs loot products by throwing in needless features to game some metric, or cutting features that users want but are "too expensive".
Engineers loot by burning resilience and multi-dimensional reliability to eek out 5% more straight line speed.
Sales folks loot by offering huge discounts to get huge deals signed, etc.
They look like heros, then they move on, leaving the place worse than they found it.
Hedge funds working with consultant buddies (BCG) to take over the board/leadership of a victim company.
The consultants then deliberately destroy the company from the inside while their hedge-fund buddies (naked) short it into literal bankruptcy.
It's a very easy game, it's tax-free (because the short position is technically never closed? or something) and it only very very rarely fails and backfires (GME).
Hard to imagine the delightful people involved leaving money on the table by missing an opportunity to profit from shorting.
Given the above, isn’t the optimal strategy to maximize profit extraction in order to invest in new industries?
The US corporate right evangelised this culture as "freedom", and now it's being eaten from the inside out by it.
My understanding, possibly biased by my Britishness, is that Jim Goldsmith was one of the earliest raiders who took over companies and asset-stripped them.
If those people don't own the company, what is the owner doing by allowing this to happen?
If those people _are_ the owners, then there shouldn't be a problem, since it's their own company, and they ought to be allowed to do anything they wish. Including short term reward for long term loss (if it is worth it in their eyes).
So i dont think it's "looting" (implying it's being stolen without knowledge of the owner).
Also viewing a company as just a collection of assets owned by capital can be somewhat limiting. Companies are generally made up of human employees, and many schools of thought treat employees as one of several stakeholders in a company and assign various rights to them and various responsibilities to the company for them.
Looking at it this way, the “owner” of a company can easily be described as looting the company if they are destroying a lot of value in the company for marginal benefit for themselves.
anyway in this case the term "looting" is meant to do things that will be of benefit to the people to the company that will in the short term maybe benefit the company but in the long term destroy it. The short term benefit often aligns with what benefits the looter, but this alignment is not hard and fast.
I'm confused about how your model of the economy works. It sounds like you believe CEOs are selfish and greedy when it comes to workers, but when it comes to pension funds, they keep stock prices high out of the goodness of their hearts?
If liquidpele's thesis is true, and executives are looking to "get rich and dip", "company be damned in the long run", then we would expect this to be reflected in the company's stock price in the long run. The stock price is essentially the fair market value of the company. And the American stock market has been performing very well for a good long while.
This entire comment thread strikes me as populist pitchfork-waving with little grounding in economic reality. Here's a question: If you're truly pessimistic about American companies, do you hold any short positions or put options? At the very least, are you overweighting non-American countries in your portfolio? And if so, which ones?
And they happen to have large influence on choice of CEO and who said CEO is going to try to please.
That is something some people choose to believe to be true. The same way some people choose to believe that God (or a number of Gods) exist.
The vast majority of us are working class.
