Worker wages drop while companies spend billions to boost stocks

[fncceo]

Boosting stock prices brings more investors into the market, improves the market capitalization of a company allows it to expand and hire more employees.

Just giving money to workers doesn't do anything for workers in the long term.

Boosting stock prices makes the stock holders richer, but does nothing to help the worker. Trickle down has been tried before, and it has never helped anyone but the rich.

If a company grows, it hires more workers. I see more jobs as a net positive for workers. Maybe others see it differently.

 

[BULLDOG]

Boosting stock prices brings more investors into the market, improves the market capitalization of a company allows it to expand and hire more employees.

Just giving money to workers doesn't do anything for workers in the long term.

Boosting stock prices makes the stock holders richer, but does nothing to help the worker. Trickle down has been tried before, and it has never helped anyone but the rich.

If a company grows, it hires more workers. I see more jobs as a net positive for workers. Maybe others see it differently.

You're right, if they use that extra money to grow the business. However, if they take the money and put it in the pockets of the stock holders, or just stack it up in the bank, workers get nothing. This is what has always happened in the past. Trickle down doesn't work. Companies already have plenty of cash reserves. No reason to believe more will make them spend it.

 

[fncceo]

However, if they take the money and put it in the pockets of the stock holders, or just stack it up in the bank, workers get nothing.

The whole point in enriching the stock holders is to encourage more people to invest in the company.

 

[BULLDOG]

However, if they take the money and put it in the pockets of the stock holders, or just stack it up in the bank, workers get nothing.

The whole point in enriching the stock holders is to encourage more people to invest in the company.

Too bad it never turns out that way. It's easy enough to check what happened when we tried trickle down before. What makes you think it will be different this time?

 

[fncceo]

What makes you think it will be different this time?

Check the list of the Fortune 500 for the past 50 years ... small companies expand and grow into big companies. Microsoft, Oracle, Facebook, Walmart, Apple, and Starbucks all started out with fewer than 50 employees and now represent a major chuck of the national payroll.

If you choose to call that 'trickle down' then that's your decision. But, it's a fact that in order for companies to grow that way, they must attract stockholders with the potential of increasing the value of shares.

 

[BULLDOG]

What makes you think it will be different this time?

Check the list of the Fortune 500 for the past 50 years ... small companies expand and grow into big companies. Microsoft, Oracle, Facebook, Walmart, Apple, and Starbucks all started out with fewer than 50 employees and now represent a major chuck of the national payroll.

If you choose to call that 'trickle down' then that's your decision. But, it's a fact that in order for companies to grow that way, they must attract stockholders with the potential of increasing the value of shares.

Small companies only received a small part of the recent tax giveaways. The companies you list are the major recipients of those tax giveaways, yet they are already cash heavy. They could expand any time they want without any help. They haven't. What makes you think more cash will change their minds now?

 

[Harpy Eagle]

Boosting stock prices brings more investors into the market, improves the market capitalization of a company allows it to expand and hire more employees.

Just giving money to workers doesn't do anything for workers in the long term.

Boosting stock prices makes the stock holders richer, but does nothing to help the worker. Trickle down has been tried before, and it has never helped anyone but the rich.

If a company grows, it hires more workers. I see more jobs as a net positive for workers. Maybe others see it differently.

When there are more open positions than workers to fill them, a company trying to hire more workers is not doing much. The only positive that might bring is that companies will have to offer higher wages to get people to leave one company to come to theirs.

So far we have not seen that happen


Sent from my iPhone using USMessageBoard.com

 

[fncceo]

The companies you list are the major recipients of those tax giveaways, yet they are already cash heavy.

The conversation was about companies enriching shareholders allegedly to the detriment of workers which I showed historically isn't necessarily the case. Increasing shareholder value allows companies to grow over time.

If you'd now like to talk about tax cuts to companies big and small, we can have that conversation.

 

[fncceo]

So far we have not seen that happen

Happens in the software industry on a daily basis. Coders jump ship like parkour rats.

 

[BULLDOG]

The companies you list are the major recipients of those tax giveaways, yet they are already cash heavy.

The conversation was about companies enriching shareholders allegedly to the detriment of workers which I showed historically isn't necessarily the case. Increasing shareholder value allows companies to grow over time.

If you'd now like to talk about tax cuts to companies big and small, we can have that conversation.

The tax cuts are being used to enrich the shareholders instead of expanding and producing more jobs. That is certainly pertinent to the discussion.

 

[Wyatt earp]

'Six months after the Tax Cut and Jobs Act became law, there's still little evidence that the average job holder is feeling the benefit.

Worker pay in the second quarter dropped nearly one percent below its first-quarter level, according to the PayScale Index, one measure of worker pay. When accounting for inflation, the drop is even steeper. Year-over-year, rising prices have eaten up still-modest pay gains for many workers, with the result that real wages fell 1.4 percent from the prior year, according to PayScale. The drop was broad, with 80 percent of industries and two-thirds of metro areas affected.

"Now, economic confidence has been good, we're in a strong economy, GDP is growing, but the question has been, where's the paycheck?" said Katie Bardaro, vice president of data analytics at PayScale.

The answer is, largely, in the companies' coffers. Businesses are spending nearly $700 billion on repurchasing their own stock so far this year, according to research from TrimTabs. Corporations set a record in Q2, announcing $433 billion worth of buybacks — nearly doubling the previous record, which was set in Q1.'

Worker wages drop while companies spend billions to boost stocks


Many (including myself) were POSITIVE this would happen with these tax cuts. Corporations stated over and over again that they were NOT going to put their tax cuts into workers (other then token, one-time bonuses for some PR) or expansion but into things like stock buybacks.

And we were right.

Still upset about having more money in your pocket?


Call 911


.

 

[fncceo]

The tax cuts are being used to enrich the shareholders instead of expanding and producing more jobs. That is certainly pertinent to the discussion.

It's a process ... step A) enrich the stockholders. step B) use the new market cap to expand the business step C) hire more workers. I've showed historically where this has been a very typical case. For tax cuts this year we're seeing step A ... time will tell if we reach Step C but it doesn't happen overnight.

Of course, increasing shareholder value only applies to companies large enough to be publicly held. Since the Dot Com Bust of 2000, an average of only 100 companies a year go public. For smaller businesses,. they can choose to pay down their debt or invest in the company, or -- heaven forbid -- enrich the owner who is the guy who put up his own wealth in the first place to start the company.

But, on the subject of enriching the stockholders ... that's universally a good thing. Even if the companies choose not to expand their businesses and spend all that money on hookers and drugs, the largest shareholders in this country are state and union pension funds whose members benefit greatly from an increased in shareholder value.

"“After all, the chief business of the American people is business. They are profoundly concerned with producing, buying, selling, investing and prospering in the world."

-- Calvin Coolidge

 

[BULLDOG]

The tax cuts are being used to enrich the shareholders instead of expanding and producing more jobs. That is certainly pertinent to the discussion.

It's a process ... step A) enrich the stockholders. step B) use the new market cap to expand the business step C) hire more workers. I've showed historically where this has been a very typical case. For tax cuts this year we're seeing step A ... time will tell if we reach Step C but it doesn't happen overnight.

Of course, increasing shareholder value only applies to companies large enough to be publicly held. Since the Dot Com Bust of 2000, an average of only 100 companies a year go public. For smaller businesses,. they can choose to pay down their debt or invest in the company, or -- heaven forbid -- enrich the owner who is the guy who put up his own wealth in the first place to start the company.

But, on the subject of enriching the stockholders ... that's universally a good thing. Even if the companies choose not to expand their businesses and spend all that money on hookers and drugs, the largest shareholders in this country are state and union pension funds whose members benefit greatly from an increased in shareholder value.

"“After all, the chief business of the American people is business. They are profoundly concerned with producing, buying, selling, investing and prospering in the world."

-- Calvin Coolidge

You haven't shown that trickle down works. It doesn't. As far as who the supposed stock holders are, there are much more efficient ways to help state and federal union pension funds.

 

[fncceo]

You haven't shown that trickle down works. It doesn't. As far as who the supposed stock holders are, there are much more efficient ways to help state and federal union pension funds.

I haven't been discussing supply-side economics (as it is referred to in polite society) but if we were, there are examples of both successes and failures of supply-side economics, depending on how it is applied..

But, regardless of that, the claim we were discussing is that companies using tax cuts to enrich shareholders hurts workers and I've shown that is clearly not the case in hundreds of examples (i.e. any company that has grown larger through increasing shareholder value).

I've also shown that increasing shareholder value clearly benefits worker whose pension funds run by states and unions are some of the largest shareholders in the country.

A healthy stock market is a good thing for investors and workers. I eschew the concept that stockholders and workers are two sides of same economic equation and that what benefits one degrades the other. In many cases, they are the same person. Without investors, there are no workers and even the biggest POS junk bond trader on the planet, even if he cheats on his taxes, still pays enough every year to keep a public school up and going.

 

[Thinker101]

Obama Calls It 'Fairy Dust,' But Trickle-Down Does Work, Economist Art Laffer Says

The Baldwin Brothers are Proof that Trickle Down Economics Works

 

[iamwhatiseem]

It's a weird thing. The economy is running pretty hot, and employers are complaining about not getting labor, but wages aren't rising much.

Depends on whose economy you are referencing.
What is "the economy"?
Is it's measures a gauge of how well the American public is doing, or how well investors are doing?
They are not one and the same, if fact, in most cases they have competing interests.
The American Public's economy is not well.

 

[Dana7360]

Boosting stock prices brings more investors into the market, improves the market capitalization of a company allows it to expand and hire more employees.

Just giving money to workers doesn't do anything for workers in the long term.

I have no idea where you went to college or what you majored in or if you even went to college.

I do know you can't be more wrong.

I did go to college, the University of Washington and my degree is in Accounting and Economics. I haven't worked in the field since the mid 90s.

A company buying back their own stock doesn't benefit the employees. It benefits all stockholders. Which includes the ceos and executives. All buying that stock back does is raise the value of the stock while removing available stock from the market for other people to buy for investment. Which also hurts the stock market and investors who don't have stock in the company but want to buy it.

The last thing it does is create demand which is the ONLY reason why any employer would hire more people.

No employer is going to hire anyone to just stand around all day doing nothing. The only reason an employer is going to hire more people is if there's more work to do than the existing staff can accomplish in a normal work day or week. If that's happening the company is having more sales and making more money. If that's happening the last thing they need is a tax cut.

Raising stock prices thus removing stock from the market that's available to buy NEVER creates a situation to hire people. The people who do that are customers who create the demand for the services or goods. Customers are the middle class and poor. The rich don't spend much money because they usually already have what they need and want. The things they usually want aren't the same things as the middle class and poor. Plus there's not enough rich people in our nation to sustain an economy.

You're very wrong about stock buy backs. They only benefit people like me. I'm invested and not just in a 401k. I'm mostly retired and financially independent.

I'm also a liberal.

What you're doing is justifying giving me and people like me more money which we aren't going to spend at the same rate and in the same things as the middle class and poor.

The thing to do is put money in the hands of those who spend it. The middle class and poor. They are the population who drive our economy with their spending.

The only way our government can raise wages is to raise the minimum wage. It's not the job of the government to pay people in private business with tax revenue. All the government is doing with tax cuts is giving business more money and any that goes to the employee is giving the employer more money through the government and allowing business to keep wages low. It's not the government's job to subsidize private business wages.

Finally capitalism can't work if most of the money is concentrated in a few hands. Capitalism needs the free flow of money throughout the whole economy and population for it to work properly. Tax cuts that mostly benefit the rich only concentrates more money in few hands which means less money is flowing throughout the economy which causes more harm to the economy and nation.