If management doesn't have a better use for residual profit they should distribute it regularly and equally. It's the sole reason for the existence of dividends. Common stock was the primary instrument for several mechanisms of abuse that led to the '29 crash. In the '87 crash common stock was again the primary instrument, what changed were the mechanisms. In the '00 crash common stock was either the primary instrument or the foundation under derivative instruments along with a blend of mechanisms. Last year was the first crash that involved instruments other than common stock, but stock and it's derivatives were brought down just the same. Stepping back from the market level we've seen common stock abused to harm individual companies. In each and every case there has been a regulatory response to the previous event that did little to minimize, much less prevent the next from occurring. It is the financial equivalent of outfitting your military to fight the last war. It's stupid, short-sighted, wasteful and above all, ultimately pointless. To state that common stock should be a reservoir for employee wealth and motivation without first making a case on how to protect that wealth is a hollow argument.
http://seekingalpha.com/article/141605-the-coming-economic-collapse-part-1?source=feed ie....The above article relates to the reasons WMT is a success.... And what about the employees/individuals that got WMT stock early on ? ...................................................... Wal-Mart Stores, Inc. is an American public corporation that runs a chain of large, discount department stores. It is the world's largest public corporation by revenue, according to the 2008 Fortune Global 500.[4] Founded by Sam Walton in 1962, it was incorporated on October 31, 1969, and listed on the New York Stock Exchange in 1972. Wal-mart is the largest private employer in the U.S.[5] and also the largest grocery retailer in the United States, with an estimated 20% of the retail grocery and consumables business. It also owns and operates the North American company, Sam's Club. ........................................................... Talk about timing.... The seeds of todayâs crisis were first sown in 1971 when the US formally opened trade with China. In an effort to boost profits, large scale US manufacturers and other multinational firms began outsourcing their manufacturing jobs to the Peopleâs Republic soon after. When other industries realized the kind of money that can be saved by sending work overseas, they soon followed suit. Outsourcing moved up the corporate food chain until even R&D jobs and other high-level, high-skill set jobs were shifted to Asia. This, of course, diminished the number of these positions in the US. Thus began three major trends: 1) The USâs economic shift from manufacturing to services (mainly financial) 2) The massive drop in US incomes 3) The beginning of the debt bubble
Oh, I see. You're one of those broadcast-only types. Thanks, it'll save me a lot of time in the future...
If there was excess in retail, the market would correct it. That is how the system works in the LONG RUN.
If you don't like Walmart don't worry. Obama is going to sic his union boys on them to screw up their business. What do you think EFCA is all about? If Obama gets his way and unionizes Walmart it will only be a matter of time before Walwart is in need of a major bailout. If there is any other company still posting a profit, don't worry the US Government will step in and correct that problem.
If there is any other company still posting a profit, don't worry the US Government will step in and correct that problem. ----------------------------------- I've always conspired that the way to do this was to run spread sheets on tax returns. Pick an industry, look for ways to cut the fat, then issue regulation ( re-acting based on news) and see if the companies cut the fat according to plan. Hence the buzzword "down sizing". It was all a gov't plot. An elementary example, IBM turns a profit (this is going back years ago). The gov't runs some numbers and declares you don't need redundant middle managers (meanwhile, redundant middle managers had nice jobs) the gov't puts a few regs in place targeting IBM and voila, middle management is gone in the name of better business practices. The former salaries fill the gov't coffers.