Best of the threads
Friday, 07 August 2009

Is Your Company Saving Cash?

> "Hoarding cash is a corporate irresponsibility: if the firm doesn't have a good place to invest cash, its duty is to return that money to shareholders in dividends. That sounds shortsighted, but there's a real agency problem when the board decides that they know what to do with the owners' money better than the owners do."

> "In this economic environment it looks better to keep the cash to make interest payments and repay bondholders. By hoarding cash, companies can also work toward getting their credit ratings upgraded and ultimately lower their cost of debt.">

> "The thing is, fiduciary duty gets complicated when a company's solvency is called into question, so returning cash to shareholders isn't a slam dunk. In fact, managers may owe as much duty to debtholders and employees at such times."

 Medical Privacy? Get Over It
> "If moving to an EHR-based system means a big reduction in the ridiculous cost of health services, I really don't care who looks at my medical record. Doctors, nurses, candy stripers. I don't care."

> "The last thing we need is a cyber-attack in which all of our health records are wiped along with credit card and related data in one single stroke."

> "Aren't some systems like the VA already all-electronic?"

Banks Too Big To Fail? Break 'Em Up
> "Guess who dismissed the General Accountability Office's claims that the big boys were inhibiting bank competition through illegal "tying" arrangements. You guessed it, the Fed. Meanwhile, banks are exempted from other provisions of the anti-trust laws. It's really time we stopped lecturing the developing world about the ills of crony capitalism. We got 'em ourselves in spades."

> "Fed chairman Bernanke's eagerness to have the Fed as opposed to another agency be responsible for looking after bank consumers' interests doesn't stem from his interest in consumers, but in making sure they aren't put before those of the banks. Maybe Bernanke thinks this is his job. But I think he's got it ass backwards."

PE Funds Find It Hard To Exit Investments
> "Those deal done in 2006 to 2008 are a big problem. There were so many of them, at absurdly high valuations. They have to be flushed out of the system and how's that going to happen?"

> "You really have to worry about the funds that got in late and were hoping to just flip some deals really quickly."

> "So many private equity firms take an ultra short-term view. I find they've been very destructive to the building of companies with real staying power."

Cracking Down On Perverse Pay

> "Lucien Bebchuk nailed it a month or so back: 'What’s now producing the outcry over executive compensation is not the sheer numbers but the disconnect between pay and performance and the sense that executives have an undue influence on their own pay.'”

> "I'm not exactly sure why the public doesn't care about mega pay for celebrities but does about pay for execs."

> "If only there was as much online chatter about the performance of a CEO as there is about the performance of a Johnny Depp. That would light a fire under a few keisters."

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