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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: engineer who wrote (43977)	1/3/2005 8:48:46 PM
From: Art Bechhoefer	Respond to of 197433

That's precisely the reason for options. Expensing options would make more sense if a company were also allowed to place an asset value on intellectual property created by the very employees receiving options. The accountants may not like it, but options could be treated more logically as a deferred cost to be taken against the IP assets thereby created. Art

To: engineer who wrote (43977)	1/3/2005 11:20:27 PM
From: John Biddle	Read Replies (2) \| Respond to of 197433

I think your totally wrong on the innovation versus stock options. I am positive that you are not aware of how the tech world really works in terms of hiring. Look, disagreeing with me is fine, and creates a healthy discussion, but your assumption and statement that I don't know anything about how the tech world works is not only dead wrong but a piss-poor way to carry on intelligent discussion. You have a history on this thread of belittling everyone who disagrees with you, and worse, of coming across like you know everything and others know nothing. But you're an engineer, so you can't possibly be that stupid, so I must be misunderstanding you. Giving you the benefit of the doubt, this once, I'll try again. I am not opposed to companies being able to use options as compensation. They have indeed become de rigeur, and not just in the tech industries. Certainly some people are motivated by money, but you'll find that in every study of motivation factors, money is far from the top, once a minimum has been reached. In addition, I would state that the huge option gifts that the top officers of corporations get today bring exactly the wrong kind of motivation, namely short-term thinking based on personal greed rather than long term thinking based on what's right for the corporation. Look at all the folks who made millions in companies that went belly up in the internet boom. This doesn't happen in the lower ranks where option largess tends to be confined to relatively small amounts for large numbers of people. But I'm not opposed to options use. I just think that like any other expense, they should be accounted for properly, not hidden in a footnote. If they have the huge benefits you seem to think, (and mgt must think so too or they would be more prudent with someone else's money, right?) then what's the problem with putting them in the income statement where they belong? If they play such an important role in making a tech company competitive I'd think they'd want to brag about how many options they give out, since that will be making them so much more competitive than their peers. Why insist on hiding this wonder of business? Because it's expensive, that's why, and management isn't proud, they ashamed, or they should be. And they hope with enough pressure on enough senators they can continue to pilfer the corporate treasury, get filthy rich, and be thought heros rather than the frauds they often are. Expensing options just puts everyone back on a more financially transparent footing, and (relative) transparency is what made the US markets the best in the world, and will be the only thing that keeps them there. We need more Eliott Spitzers, not fewer. I'm a hardened capitalist, and have been ever since my first year of college when my head replaced my heart for all my thinking. I believe in free markets and unbridled free enterprise. But I also believe that the markets in this country are out of control (getting much better than a couple of years ago but not there yet) and need closer adult supervision. Trust but verify. I believe options should remain a company's choice, but they owe shareholders a fair accounting of how much they are likely to cost, the same as they do for all other expenses. As to options being the source of America's innovation, isn't it the case that the US has been the innovation leader for at least 50 years, probably more? Since large option bonuses are relatively new, how do you explain that? Oh, everyone's doing it you say, so we all have to do it too, in order to keep up? That seems like a perfect situation for options expense transparency to help clear the decks. If you are right, and everyone continues to believe that they are getting a good return on their money by dishing out options, then they'll continue. Heck, since they're obviously such a good investment, we might even do more of it. If I am right, and people are shocked at the amount of their capital that has been transferred to the pockets of a relative handful of others, then the practice may diminish rather sharply. But if everyone does it, it won't hurt any one company. Look, I know that innovation doesn't grow on trees, and that it does come from the hard work of smart and industrious employees like yourself. I'm not trying to dismiss this hard work. But people worked hard before options were commonplace, and they would do so again.