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silvergoose posted:Same, holy poo poo. Now we just need to do the same with amazon. Amazon is going to permanently increase the "GDP" of wherever it lands by at least 10% (NYC) and could as much as double it (Indianapolis, Columbus, Nashville).
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Mar 15, 2018 18:27
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Seems like the worst parts are more traffic and not already owning real estate but planning to buy it I didn't want the Olympics or the Superb Owl because of the demands placed on the host city, but casinos and Amazon 2 don't sound so bad
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Mar 15, 2018 18:30
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If you treat HQ2 as a perpetuity worth 1/2 of Amazon's annual SG&A expenditure (40B in 2017, although it continues to grow briskly but let's assume it plateaus here!) and your current city GDP growth was 8% (itself already a very robust figure) then the price you should be willing to pay to entice Amazon to come to your metro should be: $20B / 0.08 = $250B. Even LARGE tax relief stands to overwhelmingly benefit the market where Amazon lands, even if it lands somewhere that's a very hot economy. For anywhere with a lower growth rate (many of the 20 metros identified have lower growth rates, 1-5% for example) HQ2 becomes even sweeter. EAT FASTER!!!!!! fucked around with this message at 18:38 on Mar 15, 2018 |
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Mar 15, 2018 18:33
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market for executives is a market for lemons you can't loving trust executive recruiters more than you can throw them so you get lemons, and you get failure of market to clear. failures of markets to clear is foundation of profit pretty easy to tell who profits in this case
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Mar 15, 2018 18:33
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BEHOLD: MY CAPE posted:In other words "the market demands high salaries and large compensation packages to attract and retain executives when multiple companies are competing for experienced executives" But much of the value of those executives comes from their intimate understanding of their specific industry, or sometimes just one specific company. The market is mis-pricing their value by assuming it's all about generic, infinitely transferable CxO skill. It's the end result of the management consulting craze. Sometimes you need an outsider's perspective, but assuming that insider experience is worthless leads the market to ignore and mis-price people like in Krispy Wafer's story.
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Mar 15, 2018 18:39
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Some executives are worth it, a lot aren't. Anyone see the word horse today?
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Mar 15, 2018 18:41
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Instead of hiring one CEO you could hire like six very qualified people for the same package and end up with a much better board. But I guess ultimately the money doesn't really matter. The issue isn't the giant multinationals paying their CEOs huge packages, it's the me-too small companies spending a significant amount of their budgets on CEOs for some reason.
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Mar 15, 2018 18:46
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Moneyball posted:Some executives are worth it, a lot aren't. Anyone see the word horse today?
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Mar 15, 2018 19:00
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NancyPants posted:I'm on board with the idea that if you want to attract/retain talent/experience/qualifications, you need to pay them commensurately. The problem I see in practice, though, is that executives retain their high pay and benefits and continue to be paid bonuses even when companies perform so poorly that employees need to be laid off/have benefits reduced. If we're going to say that high exec pay is that way because execs bring something to the table, they need to actually bring it to the table. If there are too many factors outside executive control to reduce compensation when the company performs poorly, it stands to reason that the good times don't have as much to do with execs as people like to think. I haven't thought this through, but: why not have salaries cap at a certain level, and have everything with responsibility past a certain point be a bonus based on performance? That way you can still pay 'top talent' top money, but if things go southward on their watch they feel it.
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Mar 15, 2018 19:03
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so I could say that I finally figured out what this god damned cube is doing. Get well Lowtax.
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spincube posted:I haven't thought this through, but: why not have salaries cap at a certain level, and have everything with responsibility past a certain point be a bonus based on performance? That way you can still pay 'top talent' top money, but if things go southward on their watch they feel it. In an ideal quasi-capitalistic society we would decide on the max variance in incomes and stick to that. The people at the very top make seven-fold those at the bottom total compensation. Although that would never work in practice.
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Mar 15, 2018 19:11
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EAT FASTER!!!!!! posted:If you treat HQ2 as a perpetuity worth 1/2 of Amazon's annual SG&A expenditure (40B in 2017, although it continues to grow briskly but let's assume it plateaus here!) and your current city GDP growth was 8% (itself already a very robust figure) then the price you should be willing to pay to entice Amazon to come to your metro should be: This is, frankly, untrue, as it ignores a number of factors like opportunity costs. It's basically assuming *nothing is going to happen* other than Amazon opening there, or not opening there. Economies do not work that way. Second: https://www.epi.org/publication/unfulfilled-promises-amazon-warehouses-do-not-generate-broad-based-employment-growth/ quote:Our key findings show that luring Amazon fulfillment centers is an ineffective strategy for boosting overall local employment Tax breaks are great for Amazon. They're not great for the cities offering them.
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Mar 15, 2018 19:25
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Fulfillment centers are hugely different from HQ2. It's not even close to a comparison. Pure unskilled labor is highly different from skilled and unskilled labor.
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Mar 15, 2018 19:29
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Even "performance based compensation" has some pretty serious drawbacks. Meeting or beating earnings. You'd expect that across 6,000 earnings reports from 500 companies that you'd get something like a bell curve. But you have a lot of right on target and very few near misses. This is done by a combination of managing expectations to lowball your earnings per share guidance and by accounting "earnings management" tricks to turn a near miss into a close win. You'll be unsurprised to learn that the targets for much of the executive compensation that is "performance based" are pretty low hurdles. Reminds me of the fluff college classes you take where 60% of your grade is "participation" for showing up every day. It can also incentivize weird or bad behavior. If the CEO needs the stock price to climb 3% in 18 months when the options vest, that CEO is incentivized to make decisions to pump up the price in 18 months, regardless of whether those are the right moves long term.
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Mar 15, 2018 19:31
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cowofwar posted:In an ideal quasi-capitalistic society we would decide on the max variance in incomes and stick to that. The people at the very top make seven-fold those at the bottom total compensation. Although that would never work in practice. At which point every low wage job will be outsourced to artificially inflate the "bottom" total comp number.
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Mar 15, 2018 19:35
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canyoneer posted:Even "performance based compensation" has some pretty serious drawbacks. assuming conservation of money you only expect something levy-stable, if two tailed levy-stable can have bias, sure, it's biased
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Mar 15, 2018 19:38
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Perhaps. But the fundamental problem is that the rosy projections on why cities are nuts if they *don't* throw tax bennies Amazon's way to try to get them to set up shop there are still based on projected benefits of the plant and not on a bunch of costs that aren't included in the analysis. Again, opportunity cost: If Amazon builds a big plant on a chunk of land, other business can't build stuff on that same chunk of land. You can assume that the Amazon plant will generate X jobs and produce Y tax revenue, but you can't assume that in the absence of Amazon that other businesses won't set up there and generate jobs and produce revenue. Maybe that holds for towns in decline, like Detroit. Does your city have an overabundance of skilled workers? If not, then all those skilled jobs that Amazon will need to employ will come from people moving in from abroad, not from the locals. Does your city have an abundant housing supply? If not, then all those skilled workers are going to result in an increase in rent and housing costs, and the local residents can get priced out of the market. Do you have a robust public transportation infrastructure? If not, then what you can find happening is that all those high-skilled Amazon workers wind up in a suburban enclave where they do their living and their grocery shopping and their dry cleaning, and don't generate much additional economic activity in the city. The increased demand for construction labor will drive up costs for other construction. Yes, building an Amazon HQ will create jobs in that sector of the economy, at the expense of jobs in other sectors of the economy because those other sectors now can't afford construction costs and won't get built. Economics is always about what is seen and what is unseen. Anyone saying without qualification that Amazon HQ will only have benefits is ignoring the unseen.
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Mar 15, 2018 19:43
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BEHOLD: MY CAPE posted:In other words "the market demands high salaries and large compensation packages to attract and retain executives when multiple companies are competing for experienced executives" Maybe. When it comes to huge multinational companies, it's real difficult to accurately gauge how much one individual is worth. Jobs was worth a billion a year. Bezos is worth at least as much. Musk's value as a chief executive is most of Telsa's market cap. If your company is making tens of billions of dollars every year, it kind of makes sense for the top guy to make .5% of that. Personally I'd rather have a salary multiplier for CEO's. The top person shouldn't be able to make more than say 100x the lowest paid person. But that doesn't work because the company would just find ways around it, like outsourcing all personnel except for senior managers in order to make the numbers work. It's real risky for government to muck around with pay because you end up with stuff like the U.S. healthcare system.
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Mar 15, 2018 19:45
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AKA "Why Seattle is bad now" I appreciate that Portland is home to zero S&P 500 companies
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Mar 15, 2018 19:46
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Just tell them Atlanta has better strip clubs
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Mar 15, 2018 19:49
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Phanatic posted:Anyone saying without qualification that Amazon HQ will only have benefits I would challenge you on this, I was pretty specific that I was slicing just the annual GDP benefit of having 50,000 SG&A jobs show up in your metro.
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Mar 15, 2018 20:11
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spincube posted:I haven't thought this through, but: why not have salaries cap at a certain level, and have everything with responsibility past a certain point be a bonus based on performance? That way you can still pay 'top talent' top money, but if things go southward on their watch they feel it. The problem there is if the company is already failing and you fire the CEO and have to hire another one. No smart executive would take the job as their bonus would probably be nothing for a while and if the company dies off they become remembered as the guy or gal that killed the company hurting future job prospects. To attract someone to try to save your company you offer them a larger salary and a parachute for them in case they fail. Otherwise you are stuck hiring someone stupid (thinks with them there there is no chance the company will fail) or someone desperate (has nothing to lose and is probably not a good pick anyways). I do not like the system but it does make a certain kind of sense. Unfair but does make sense. Edit to provid relevant content: I saw a horse on the way to work today. It is probably dead now after thinking of ants or a fat person on its back.
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Mar 15, 2018 20:13
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So this is an ad
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Mar 15, 2018 20:17
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Xenocides posted:The problem there is if the company is already failing and you fire the CEO and have to hire another one. No smart executive would take the job as their bonus would probably be nothing for a while and if the company dies off they become remembered as the guy or gal that killed the company hurting future job prospects. To attract someone to try to save your company you offer them a larger salary and a parachute for them in case they fail. Otherwise you are stuck hiring someone stupid (thinks with them there there is no chance the company will fail) or someone desperate (has nothing to lose and is probably not a good pick anyways). The current system doesn't do enough to provide disincentive from execs making short-term decisions and jumping at the first sign of failure.
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Mar 15, 2018 20:21
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Hoodwinker posted:Maybe companies that are dying due to bad leadership should die, and new systems would begin to pop up to adapt to this change as we stop trying to act like funneling money into an individual's pocket is more effective than letting the resources involved in the company's lifecycle get liquidated and distributed among investors. If you can convince the board of directors to let their company die more power to you.
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Mar 15, 2018 20:22
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Xenocides posted:If you can convince the board of directors to let their company die more power to you.
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Mar 15, 2018 20:23
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Phanatic posted:1) but the fundamental problem is that the rosy projections on why cities are nuts if they *don't* throw tax bennies Amazon's way to try to get them to set up shop there are still based on projected benefits of the plant and not on a bunch of costs that aren't included in the analysis. 1) This doesn't make sense, HQ2 isn't a plant, it's commercial real estate and administrative offices. These are explicitly not distribution warehouses, they're administrative offices. 2) This neglects the growth rate of the surrounding economy as being the term "r" in your perpetuity as I showed with my calculation. If the rest of the economy has a growth rate of 20%, then it's foolish to pay more than $100B to attract Amazon who's only going to give you $20B a year. The math handles this quite nicely. 3) This grows the tax base of the city, and is a net economic positive. 4) This increases property taxes, and is good for the financial health of the community. 5) This is explicitly a condition of the Amazon HQ2 requirements, and it can be argued that these kinds of infrastructure projects undertaken to attract opportunities like HQ2 are among the best value-adding investments cities can make. 6) Again this is addressed by the growth rate of the regional economy, and you'd be absolutely foolish to forgo Amazon's HQ2 for "nebulous unspecified other opportunities" provided you've done the math - unless it costs you more than $250B to get the opportunity. 7) 50,000 new jobs, billions in additional regional GDP, unless you think that Amazon is going to consume more in resources on an ongoing basis than it's going to provide to the community, this is a net positive for whoever "wins."
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Mar 15, 2018 20:24
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Moneyball posted:So this is an ad I mean, they're not wrong.
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Mar 15, 2018 20:24
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Moneyball posted:So this is an ad
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Mar 15, 2018 20:33
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Its so legit, that 80% + of the women who make 6-figure incomes every year do it THIS WAY!!
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Mar 15, 2018 20:41
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lol dumb bitch, I was ordering pizza over the phone in like 1991
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Mar 15, 2018 20:50
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Enfys posted:Its so legit, that 80% + of the women who make 6-figure incomes every year do it THIS WAY!! The original stat that this comes from is in a magazine from an MLM. The original stat is that of the MLM distributors making $100k+ annually, 80%+ of them are women. That's totally believable, considering the gender mix I've observed of people selling MLM stuff. You can't flip it the other way though, stats don't work like that. edit: 
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Mar 15, 2018 20:55
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quote:4) the local residents can get priced out of the market. EAT FASTER!!!!!! posted:4) This increases property taxes, and is good for the financial health of the community. "let the working class eat poo poo" thanks for the Amazon fellatio https://www.reddit.com/r/personalfinance/comments/84n6xc/200kyear_household_what_do_i_do_with_my_cash_that/ posted:200k/year household, what do I do with my cash that I need liquid? Of course it's crypto. Glancing at his post history, he has $60k in Bitcoin and some more money in some other shitcoins. At least they make a lot of money. Hopefully his spouse isn't the breadwinner who gets pissed when the money all disappears and divorces him.
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Mar 16, 2018 03:06
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Inept posted:"let the working class eat poo poo" thanks for the Amazon fellatio I'm uh... this line: Need to get 1M to start a bank What the gently caress?
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Mar 16, 2018 04:44
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GoGoGadgetChris posted:Ew dude, lol. Why do you think female stay at home parents are dumb Uh, that is not what I said, at all. Did you not read the first half of my post?
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Mar 16, 2018 05:01
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Enfys posted:Its so legit, that 80% + of the women who make 6-figure incomes every year do it THIS WAY!! So you should sell your babies because they are worth more? I'm confused. Edit: So Much More
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Mar 16, 2018 05:03
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tomapot posted:So you should sell your babies because they are worth more? I'm confused. Perhaps she is suggesting monetizing them using the Jonathan Swift method?
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Mar 16, 2018 05:23
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Commissar Kayla posted:Uh, that is not what I said, at all. Did you not read the first half of my post? I thought I saw some poo poo implying SAHMs were stupid, but if it wasn't intended then no worries duder 
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Mar 16, 2018 05:32
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GoGoGadgetChris posted:I thought I saw some poo poo implying SAHMs were stupid, but if it wasn't intended then no worries duder Got it! Implying SAHMs are stupid is a pretty common and lovely thing people do, so I can't blame you for assuming that is what I was saying. Mostly I was posting about how MLMs basically tailor themselves towards SAHMs because SAHMs often face the same problems, like needing to make more money but not having the uninterrupted time free for even a part-time job. MLMs claim to provide financial independence, too, which in some communities is something that is very difficult for women to get normally. And now I've made myself sad. I'm going to go find some horses to contribute? (Is it self-posting if I talk about the time my great-granddad decided to buy a herd of mostly unbroken ponies for his twenty grandchildren? Because that is a thing that he did.)
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Mar 16, 2018 05:52
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I learned today that a friend makes $100k a year (very rich) over the last few years selling her services to MLM morons and affiliate marketers. She sells branding and website/social media packages. Obviously terrible value for the consumer, but GWM for her.
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Mar 16, 2018 08:05
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Inept posted:"let the working class eat poo poo" thanks for the Amazon fellatio
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