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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: elmatador who wrote (28097)1/29/2003 1:38:50 PM
From: RetiredNow  Read Replies (1) of 74559
 
This article is absolute rubbish. The shareholder is a part OWNER of the company. The insiders are employees, and to the extent they own options or shares, they are also owners. At the end of the day, the OWNERS should be enitled to the profits of the firm either in the form of dividend payouts or share price increases to reflect the increase in enterprise value of reinvesting profits. To say that employees are ENTITLED to profits above and beyond their compensation is misguided. Profit sharing and ownership distribution is a means toward creating incentive alignments. Those things work just as well as cash bonuses, if handled properly.

At the end of the day, if shareholders decided that they weren't getting their fair share of the increase in value of the firm, then they will sell their shares. That will reduce the market value of the firm to almost nothing, if the majority sell en mass. Then the author of the article below wouldn't have many doubts about who is in control of the company.
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