[HN Gopher] Major investor calls on Google owner to 'aggressivel...
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Major investor calls on Google owner to 'aggressively' cut staff
and pay
Author : account-5
Score : 23 points
Date : 2022-11-15 21:44 UTC (1 hours ago)
(HTM) web link (www.theguardian.com)
(TXT) w3m dump (www.theguardian.com)
| usednet wrote:
| > Guy with an MBA tells company to do the only advice guys with
| MBAs know
|
| Its already been talked about endlessly here but time and time
| again we see that when MBAs come in, pay decreases but profits
| don't increase.
|
| https://www.nber.org/system/files/working_papers/w29874/w298...
| jmoak3 wrote:
| They also unabashedly call to increase the buybacks in the face
| of imminent recession.
| clpm4j wrote:
| Ah of course, billionaire Sir Christopher Hohn wants hundreds of
| people/families to lose their incomes so that he can potentially
| juice a few more percentage points of fund returns.
| newaccount2021 wrote:
| Jyaif wrote:
| News at 11, shareholder wants to:
|
| * reduce compensation
|
| * reduce R&D
|
| * increase share repurchase program
| adam_arthur wrote:
| Well it's a fair point to ask why Google's median comp is far
| higher than Microsoft.
|
| Can it be justified with better results?
| yakak wrote:
| I'm not sure why that matters. For a very long time I was
| impressed with the low number of employees and the income per
| employee at Google. I think their raise in employees should
| ideally be because they finally have a new product with
| similar income per employee potential, less ideally they
| could be releasing a new product branching into Microsoft or
| IBMs territory and need many somewhat lower paid employees.
| adam_arthur wrote:
| It matters because inefficient business are bad for
| society.
|
| The reason economic prosperity has raised so many out of
| poverty is because systems and businesses get more
| efficient over time.
|
| Because when markets are competitive, cost to consumer
| declines to cost of production (with perfect competition)
|
| That's the philosophical answer. If Google had more direct
| competition market forces would push wages down on their
| own.
|
| Make no mistake though, it's not altruistic whatsoever to
| defend a system that functions inefficiently. It's a value
| transfer from broader society to the above market wages of
| whichever company. Maybe that adheres to your priorities,
| maybe not, but broader society does best in aggregate when
| competition drives efficiencies
| lotsofpulp wrote:
| Who is the Google owner?
| PeterCorless wrote:
| Alphabet owns Google. Alphabet's Top 10 major shareholders, who
| collectively hold 28% of total shares outstanding, can be found
| on this page:
|
| https://money.cnn.com/quote/shareholders/shareholders.html?s...
| adam_arthur wrote:
| Alphabet.
|
| I guess they figure many don't know that the company is
| technically called Alphabet
| lesuorac wrote:
| Don't agree.
|
| I think it's poor writing on the articles part. The letter is
| addressed explicitly to Sundar Pichai not Alphabet.
| adam_arthur wrote:
| The heading at the start of the letter says Alphabet
| lesuorac wrote:
| No the letter's heading says "TCI Fund Management
| Limited". Right under that says "Sundar Pichai".
|
| https://www.tcifund.com/files/corporateengageement/alphab
| et/...
| adam_arthur wrote:
| PeterCorless wrote:
| While I can understand he wants compensation to be in in line
| with other peer tech companies in regard to non-technical roles
| at the same time Google isn't facing a fiscal cliff like the
| other companies were.
|
| After viewing what happened at Twitter, nobody should be taking
| _any_ activist investor advice seriously any more. If he doesn 't
| like how Google is run, guess what? He can SELL HIS SHARES.
|
| Google stock value is $1.28 TRILLION. This guy has a $6 billion
| investment. That's ~0.46% of the total value of the company.
|
| He's trying to pad _his_ pocket by having the line workers empty
| theirs. He can kick rocks.
| lesuorac wrote:
| I might've missed it but I don't think the article actually links
| to the letter. I thought it was interesting that they called to
| reduce the pay of non-engineers rather explicitly.
|
| https://www.tcifund.com/files/corporateengageement/alphabet/...
| sschueller wrote:
| Well I for one call on Google to cut any stock buy backs and
| dividen payment.
| lesuorac wrote:
| GOOG and GOOGL don't have dividends.
|
| TCI actually calls on them to increase buy backs as
| "Alphabet's large cash balance is serving neither
| shareholders nor the company" and "share price is down 34%
| YTD ... The stock is very cheap ... Alphabet should ...
| significantly accelerate share repurchases".
|
| I personally disagree with some of this logic though. IMO, a
| large cash balance is serving the company as a hedge at going
| bankrupt and is less than a quarter's worth of expenses
| (~150B [1]). While companies aren't the same as individuals,
| I do think you can be justified in saying you're keeping 3
| months worth of expenses in the bank.
|
| [1]: https://abc.xyz/investor/static/pdf/20221025_alphabet_10
| Q.pd...
| PeterCorless wrote:
| In a world of increased fiscal uncertainty having cash-on-
| hand makes a huge difference in being able to weather
| storms. We are literally weathering international warfare
| in Europe, a pandemic, and uncertainty whether we are
| heading to a period of inflation or recession [both?].
|
| While minimizing your cash position is smart as a hedge
| against inflation -- dollars will be worth less tomorrow so
| get rid of them now -- it also helps weather a bad quarter
| or even a bad year or two. Being cash-strapped when a
| stochastic negative event hits means you are suddenly
| _FORCED_ to take actions you would prefer not to. Like
| massive layoffs, scaling back on your core offerings, or
| cutting off your nose for future growth business.
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(page generated 2022-11-15 23:01 UTC)