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Strategies & Market Trends : Value Investing

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To: Madharry who wrote (48751)	7/13/2012 1:00:01 PM
From: Gulo	1 Recommendation Read Replies (1) of 78746

One thing that would help the situation is more shareholder activism. companies that have investors that want to own a business tend to be well run. That doesn't describe the banks or most other large public companies. <rant> Too much of the equities market is composed of people that just want to trade rather than invest. Take shorting, for instance. Does a share sold short include voting rights? People don't care, and there is no distinction made between shares bought from a short-seller versus from a stockholder. Shorting effectively creates new voting shares, with both the buyer and the owner of the loaned shares claiming voting rights. The result is that shareholder votes cast can exceed the number of shares outstanding. What's up with that? If "shares" sold on exchanges were actually registered shares of the company, settlement could take place immediately, and there would be no delivery issues or voting problems. Of course, that would take a paradigm shift for investors to actually begin to care about how their company is run. <end rant>

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