Slashdot Mirror
Google Faces Wall Street Revolt
Fred Flange wrote to mention a Times of London article, which explains a minor rebellion against GOOG on Wall Street. The company, which has always refused to offer guidance for its stock, is now being peppered with requests to do just that. From the article: "Sergey Brin and Larry Page, Google's founders and biggest shareholders, made plain in their listing prospectus that the company would reject many of the orthodox methods of doing business with Wall Street and instead adopt a mantra to encourage its employees to do good and not 'evil'. Other Wall Street analysts last night were also preparing reports that agreed with RBC, The Times has learnt. 'The time has come for Google to step into line,' one analyst said. 'It is in the interest of all shareholders, including the company's employees and officers, that the share price achieves some stability.'"
From TFA: Whether or not Google is actually adhering to that mantra is debatable, but beside the point. When Google went public, they became obligated to the stockholders, regardless of any preexisting 'mantras'.
____
~ |rip/\/\aster /\/\onkey
If GOOG was up front with their way of doing business and it's acceptable by SEC and other relevant regulators and the analysts don't like it, then I say the analysts can kiss GOOG's multicolored ass.
Trouble making decisions? Just flip for it.
Maybe the analysts should do their own research on the company?
Sounds like it will soon get worse.
Smile, don't click...
Is Google the only company that does not give out this information? How common is this?
I meta-moderate because I care.
It may come as a shock but Sergey Brin and Larry Page don't own the universe and while they may be masters of search they aren't masters of Wall Street. You do what the Street expects or your stock price pays the price. Ultimately, they'll give in. Almost every "outsider" makes the transistion to an insider when the door opens, no matter their initial intensions.
If the analysts can't predict, then the stock price would fluctuate.
This introduces uncertainty, and the last thing that Wallstreet likes is uncertainty. Sometimes, companies have their stock prices going up even after they've lost a major deal simply because the period of uncertainty is over.
So, this makes a lot of sense - Google is causing uncertainty in the price, and that is definitely not good for GOOG's shareholders (or for Wallstreet, for that matter).
"I find your lack of faith disturbing"
Stay strong, Google! You may do things we don't like ocasionally, but you're still a wonderfull breath of fresh air in this rather stagnant world...
Z
Google stock is so unbelievably overvalued. This is what happens when there are more investors than investments, and when people buy stocks in the trendy companies. Ah well, "the rich get poorer" is always good.
Religion for nerds. Stuff that really matters
What do they get paid for? Regurgitating whatever the company says?
A listed company doesn't have to provide guidance. However, they do have to make all information equally available to all investors.
What Wall Street dislikes is that Google is pointing out how moronic they really are.
Tell 'em to
1) get bent
and
2) do their own work, the lazy bastards.
Love,
Justin.
You're only jealous cos the little penguins are talking to me.
... is just how close to the mark this guy is?
It was a fun ride, but the Wall Street community is large and powerful. All the power to Google if they can hold out, they made all the right moves, but eventually the "can't fight city hall" mentality will creep into the workforce and stifle new creativity. The employees will start working for next quarters results instead of the grand plan envisioned by the company heads.
Stay tuned for new sig...
Simply put: when you become a publicly held company you have a responsibility to your shareholders. Until upper management learns this, their stock price is going to continue to decline sharply.
How exactly is it an "evil" thing to be open and honest with your shareholders rather than asking them to trust in your "master plan?" That's like listening to the guy in the back alley who says "trust me, just close your eyes." Shareholders are going to become frustrated and begin to unload their shares as they realize that they own hugely inflated stock with no real idea of how the company intends to achieve that valuation on the books and not just in the eyes of stock market prospectors.
Sometimes it is better not to let these folks get a foot in the door, because otherwise you get a bunch of people second guessing what your intentions are, and advocating positions that are great for them, but not for the long term prospects of the company.
"It is a greater offense to steal men's labor, than their clothes"
They'll toe the line for China, but not for Wall Street?
Read any good sonnets lately?
"..the company would reject many of the orthodox methods of doing business with Wall Street and instead adopt a mantra to encourage its employees to do good and not 'evil'."
Which is tantamount to saying the stock market is evil. I don't know much about Wall Street, maybe someone would care to explain, in apolitical language, why this perception holds so widely. Is it time for a legislative revision of how these forces work in order to regulate the "profit trumps ethics" attitude of investors? Or does Google have enough might and integrity to tell Wall Street where to get off and go it independently. Can they unilaterally pull out and become a non-public company again?
See. Another one. WordPerfect, Netscape, etc. etc. Now we can add Google to the list. Sure, Microsoft illegally uses its monopoly, but their competitors keep doing stupid things.
Great, Google. Piss off the DOJ, piss off Wall Street, get more bad press by sending Chinese to labor camps. You think you'll get more capital by being silent to instituational investors? How are you going to grow and expand when your stock price is at $5.00? When Microsoft starts leveraging their monopoly on your search and ad business, do you think the DOJ will give a rat's ass when you complain to them?
That's great. The biggest hope we've had in 10 years for a valid competitor to Microsoft is now shooting themselves in the foot.
Google investors overbought a black box and they were willing to such a thing because of greed. Now that they're invested, they've decided they want to see inside that black box, despite their having known it was a black box when they bought it. Why? Greed.
Let them stare their greed in the face for a while.
STOP . AMERICA . NOW
An analyst for RBC Capital Markets yesterday was the first to call for Google to step into line with the majority of US listed companies
And who is this person to tell Google what to do? Just because they can not maximize their profit margins more easily, Google must change their ways?
He who knows best knows how little he knows. - Thomas Jefferson
"The time has come for Google to step into line," one analyst said. "It is in the interest of all shareholders, including the company's employees and officers, that the share price achieves some stability."
What he's really saying is "Hey, we want a sure thing. Give it to us!"
I know very little about the stock market and corporate finance so take this with a grain of salt. Since they are a public company now, Google is answerable to the stockholders, but I don't see how Google is required to assist investors in figuring out what the stock is going to do. Playing stocks is, in essence, nothing more than high-stakes gambling. If you want something steady and reliable, find a different source of income.
Only two things are infinite, the universe and human stupidity, and I'm not entirely sure about the universe - Einstein
Serious investors should think long term, not what this quarters profit will be. One huge problem with U.S. companies is that their upper management folks are compensated with stock options (or grants) and are often based on current performance. Why make a long term investment when you can cut current costs to make a profit now? Wall Street thinks you're making money and the stock goes up up up and you can cash in.
Google's doing the right thing telling "The Street" to fuck off.
Wall Street is still pissed off that they missed out on the initial public offering by Google going with a "Dutch Auction" where individual investors set the initial price, not a fixed price where insiders who get alloted shares can rake in freebie big payday.
Ya, I'm talking about you Goldman Sachs.
Bottom line is Google shouldn't cater to these "analysts". They all have axes to grind and pandering to them is a waste of time and money. Google should pursue success in many paths and if one of them takes years or decades to pan out, so be it.
Not that Google wasn't pulling a fast one the little guys who did invest in their company. The stock Google sold was "diluted voting rights stock". That's right, the original owners get special super duper voting power over you clowns with 100 shares.
Not.
They are obligated to do precisely and only what their prospectus, corporate charter, and public writings and speech say they will do. They are not obligated to give analysts "guidance" or play any of the other foolish games Wall Street wants them to play.
This talk of stability in stock price is just whining. It's also a key test for Google, who will now show that they are either sellouts or true idealists. While I don't hold the same ideals as they do, and don't think selling out for the kind of money they got is such a bad thing, I find the whole thing interesting as a study in human nature.
sigs, as if you care.
Or: a used car dealer sells you a car to make a profit of two hundred bucks, which he will spend on booze and hoes. He's never had an ethical thought in his life and cares only for his own pleasure.
Which one serves you better? Obviously, the greedy, unethical dealer.
you can bet yOUR highly mortgaged .asp it will not leave without a big badtoll.
for many of US, the only way out is up.
don't forget, for each of the creators' innocents harmed (in any way) there is a debt that must/will be repaid by you/US as the perpetrators/minions of unprecedented evile will not be available after the big flash occurs.
'vote' with (what's left in) yOUR wallet. help bring an end to unprecedented evile's manifestation through yOUR owned felonious corepirate nazi life0cidal glowbull warmongering execrable.
some of US should consider ourselves very fortunate to be among those scheduled to survive after the big flash/implementation of the creators' wwwildly popular planet/population rescue initiative/mandate.
it's right in the manual, 'world without end', etc....
as we all ?know?, change is inevitable, & denying/ignoring gravity, logic, morality, etc..., is only possible, on a temporary basis.
concern about the course of events that will occur should the corepirate nazi life0cidal execrable fail to be intervened upon is in order.
'do not be dismayed' (also from the manual). however, it's ok/recommended, to not attempt to live under/accept, fauxking nazi felon greed/fear/ego based pr ?firm? scriptdead mindphuking hypenosys.
consult with/trust in yOUR creators. providing more than enough of everything for everyone (without any distracting/spiritdead personal gain motives), whilst badtolling unprecedented evile, using an unlimited supply of newclear power, since/until forever. see you there?
"If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land."
In all fairness, the US economy has more debt than it can pay off, and is very nicely positioned for a currency collapse, not to mention a recession at mininum. Google isn't the only company under attack, but is the most noticible because of it's very high P/E. The dollar, bonds, housing, and the stock market are in very high risk of a breakdown. The only safe sector left is commodities.
I'm not a stock broker, but I do know that companies can be delisted from a stock exchange for a variety of reasons. Could Google get delisted for being too tight lipped? They've got to offer at least some guidance to stockholders in their annual reports.
I'm not saying I don't respect what Brin and Page are trying for, but they're going into a well-established arena and trying to do things in what seems to be a very unique way, an arena which is largely satisfied with the way things work. Perhaps we might see some minimum disclosure requirements added to the requirements for being listed on NASDAQ.
Frame it in the open source discussion, and some opinions might change. Isn't what analysts are calling for just like what the open source community calls for? We want to know how code works, to make sure it's doing the right things and not hiding wrong things. Isn't this what the Bush administration is criticized for, not giving guidance as to what they're doing? This is financial analysts wanting to get an idea of what's going on underneath the hood, rather than just guessing.
Again, I respect what they do, and if they push gently, they'll get something put in motion. But, if they push too hard for what they want before the market is ready for their philosophy, something might break.
When they asked people to buy your stock they took their money. Now they need to grow up a touch and start acting like a real corporate entity. Although you are no longer getting your money from them, your stock price is determined by how the act. The last few weeks they have acted like a bunch of High school kids dropping hints, putting data on their website by accident, and making the market price of their stock take massive moves. One can't do this in a grown up world, give in Google and give us some nnumbers or at least clean up your outside look at the company. I havent touched their stock because i think its over valuated and because i see no stability in their actions.
Firstly, these are predominantly 'sell side' analysts. That means they do analysis to pass to their salesmen or customers to increase their trading revenue/customer retention(attraction).
;) instead of posting to Slashdot for fun).Ironically, while sales side companies want to make predictable prices and promote information disclosure, they benefit most from markets with higher volatilities (or volumes, but they're extremely linked in practice).
It is nice to have your cake and eat it. It is nice to provide reliable analysis based on facts. Plug the snippets of information you receive into a spreadsheet and press the VBA button (because all such macros are in Excel, for better or for worse). You get a reliable forecast and lots of happy customers that compare your estimates to others' and think you're good. Except eveyyone else is doing the same thing, or rather, playing the same game.
In Google's case, they play a different game. The analysts' spreadsheets don't work so well, in part because Google's business is slightly different, in part because Google take the approach to only report really important things, their methodology of re-evaluating guesses as Google's official announcement approaches doesn't happen. They twiddle their thumbs and complain about being made to play a different game.
Now, I am somewhat sympathetic to them, and somewhat not. Variance of price is important in finance. Would you rather have a mean return of $5 per year with a variance throught the year of $2 or with a variance of $1? We're talking ex-post variance here, as a predictor of your portfolio's ability at maintining value at that instant you're ready to draw it down (or add more money to), not ex-ante picking over or underbought markets (and if you can, please let me know how so I can buy a tropical island with lots of native women
As variance is important, getting a steady newsflow is also important. But I'm also in favour of taking a long term view in finance: assessing the long term prospects of a company. As such, as an investor in Google I'd not be happy if they were spending their finance department resources nit-picking every last daily cent so they can tell the market something every day - focus on the big agenda and the long term outlook and make that the priority for the company.
So it is with balance. I have no sympathy for trading sales funded wings of Investment Banks/Brokerages coming up with useless ideas daily to get more trading revenue (funded by people increasing trading), essentially creating news. But I also think steady prices are important, and if a signifant unpublicesed fact comes to light at Google, they should disclose it to their owners (as is required by the SEC). How significant is significant? Well, large enough for their long term shareholders (pension funds, insurance funds) to get upset, and well above the level of news-for-the-sake-of-it salesmen.
What bothers me about this is not that Google refuses to provide more earnings guidance, but that the investor are acting like little whiny bitches. Google told Wall Street this is exactly how they would run their company. I have no sympathy for anybody who bought Google stock expecting the company to act like the most other publicly traded company. If they don't like it they can sell the stock. Does everbody allready forget that Google told people not to expect regular earnings guidance BEFORE they went public? I'm not so sure Page and Brin car if the stock deflates all that much. The stock is over valued to begin with. But I guess in the end you can't fault wall street for trying. If they get Google to change they win. However if they don't, and Google holds strong then they just look like fools to me right now.
The shareholders and stock analysts and 10x more fickle with google than any other stock. They have turned google's stock into a big circius. And none of it is google's fault!!!!!!! They've brought it upon themselves. Why? Because they don't understand google as a company. At every announcement google stock either goes up 10% or down 10%. Google's stock has become disconnected from their actual health as a company. When people get burned bad enough google's stock will go through an adjustment period (which we are somewhat seeing now). Eventually, when people get some damn common sense regarding google stock, it will see normal market prices. I laugh when I see "google honeymoon is over". You jackasses created this false honeymoon! The only ones you have to blame are yourselves.
If an officer ever threatens to taze you, say you have a pacemaker.
So basicly the stock market is used to companies hyping themselvs and giving people tips so their stock rises. In doing so they make the stock brokers quite rich.. but Google has gone "screw this" and made the brokers do their jobs without having their hand held.
Good on Google, screw the corrupt stock market system and keep doing that geek thing!
I like muppets.
The Times not "Times of London". It was the original Times so has the right to be refered to by The Times moniker.
Actually, of all the mighty investors of the world, (the great) Buffet actually recommended many times to the company he owned shares of to not offer guidances anymore, since it creates useless fluctuation in the stock. Funny, isn't it? I think Coca Cola's CEO is one that accepted that and changed it's behavior. Guidances create movement that benefit the analysts who have a heads up on it, and people who PLAY the stock market. Long term investors do not gain from it. Google's "players" are frustrated because that's an overspeculated/inflated stock and there's big drops in those. Let them burn...
What does it mean to "offer guidance" about your stock?
How about, "Please buy it!"
Does that count as guidance?
Steve
A work that expires before its copyright never enters the public domain and thus enjoys eternal copyright protection.
Yeah, right. Stock up on barrels of oil and store 'em in your basement.
Various sectors are at risk, especially residential real estate; but the US economy seems to keep chugging along.
In the long run, stocks beat real estate, bonds and commodities.
Go long and stay long on equities until your kids inherit your million dollars.
Picking what sector is going underperform next quarter or year is fool's game.
I feel that this is incorrect -- Google and its board of directors have a responsibility to ensure that the company remains stable and grows at a reasonable rate. By and large, Google is not responsible for ensuring that its share price become "stable" -- that is for the investors on Wall street to decide.
It is not uncommon, incidentally, for companies not to offer quarterly guidance. This is particularly the case with companies and in industries that are cyclical (e.g., perhaps they sell more apples in May to August, but practically none in January to April). Berkshire Hathaway offers only a single, yearly report (no quarterly updates), for, as explained by Warren Buffett (its CEO), quarterly guidance merely serves to satiate the manic-depressive Wall Street than to give meaningful insight into company operations.
I think that the fact that Google has chosen not to offer guidance is a good thing, since it is still growing its core business and may go several months with negative earnings (e.g., it might be expending lots on R&D, buying businesses, or building infrastructure) despite positive growth on a yearly basis.
I am still convinced that this whole flap is a CI operation against Google. I wonder if Stanfor analysts would like to weighed in on its thoughts in this area? Their China analysts are the best there is.
Anyhow, Google seems to be responding about as best as could be hoped for. I really like the idea of them moving their servers to a safe nation. Regardless of other issues, the information in those servers is really dangerous to everyone regardless of nationality.
Google still has to repair the damage done by falling for the Chinese censhorhip bait, but I don't think anything permanent is done yet.
As far as the rest, they will have to play it by ear, but if they do it right, they should escape relatively unscathed. The important thing is to not fall for any more bait, A CI operations success usually depends upon targets that have knee jerk reactions.
'The time has come for Google to step into line,' one analyst said.
Oh yeah. Talk like that would surely get me to listen to what they're telling me to do. Boohooohooo. The analysts can't manipulate the stock as easily as they want...
This guy's the limit!
I heard a segment on NPR this morning about this. Larry Page was saying that Google wants to stay focused on the long term and that releasing these quarterly estimates would be the equivalent of somebody who is trying to lose weight stepping on the scale every half an hour. I think this makes sense. When companies release quarterly data it can encourage business practices that boost short term profits.
nothing
Because every point on the capital market line has a positive mean return. Gambling is always negative unless you're a competent hustler.
I for one stand by Google's decision to ignore the stock market analysts. they're mostly crooks anyways.
I guess you must be writing a lot of calls then?
Talk about a story! This would be perfect. A brave new company, vowing to do no evil, catches the eye of the sophisticated and worldly financial mentors. The company decides, through a bit of unconvincing sophistry (a soliloquy is called for I think), that being a teensy bit evil wouldn't hurt that much. Just to please its new financial "friends" you understand. A little profit clears of the deed.
But, by the end of the play, the company finds out its financial mentors aren't the types to have any true friends. Our hero end up morally tainted, isolated, and reviled. In the play, death would simply be putting him out of his self-inflicted misery.
I'm not generally a practicioner of Schadenfreude, but I'm particularly fond of this brand of catharsis. I always feel like leaping to my feet and cheering when Lady Macbeth loses her marbles. "That's what you get you stupid lummox!"
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
Google has no responsibility that I can see towards providing analysts with all the information they'd like to have.
More to the point, earnings guidance is not even actual information. It is simply a guess. Google certainly has no responsibility to provide that to analysts or anyone else.
Build a man a fire, he's warm for one night. Set him on fire, and he's warm for the rest of his life.
I side with google on this. But their "do no evil" policy may be incompatible with the legal rights of the shareholders. Ever since Dodge v. Ford it's been pretty much accepted in the US that companies cannot practice philanthropy at the expense of shareholders.
Though we all like the idea of "do no evil", when it comes to business the idea can be very subjective.
The US borrows in its own currency unlike the rest of the world, so if the currency is devalued, the guy we borrowed the money from suddenly gets paid a lot less.
-mkb
"MIT betrayed all of its basic principles."
That's not breaking 'do no evil' that's "they didn't do some good that they could have done".
By the same token, I only give to two charities: I could give to lots more, but failing to do so does not make me evil.
Justin.
You're only jealous cos the little penguins are talking to me.
Honestly, I think Wall Street is good for folks to make money - Retirement, investments, etc. However, Wall Street seems to think it is a function of everyday business in every company - a proxy Board Member, if you will. (Yes, I know I am a lowly software engineer and musician... but hear me out...)
I think it is very important that publicly-traded companies are accountable for their actions. I also think that they have duty to both those inside the business and those who hold shares. However, I don't think that the generalists on Wall Street should be in the business of making a company run one way or another - it is not incumbent on investors to decide company policy. Market forces will take care of businesses that don't do the right thing. Said differently, the company needs to be the one minding its business - Wall Street will punish or reward based on the merits of the company.
A Passionate Independent Musician
The analysts should earn their own salaries by analyzing Google, instead of republishing corporate PR like they do for every other public company whose stock they resell to their clients. Getting "guidance" to determine the stock price from the company profiting from the stock is almost as corrupt as publishing the "research" based on it to sell the stock at a higher price than that at which the analyst's firm bought it.
Since the brokers are demanding Google start to play their evil game, it's no surprise that the brokers also want Google to stop saying such bad things about "doing evil". Even though that "mantra" has no relevance to the stock, its info, its guidance or corporate performance whatsoever. They just want Google to stop being so different from the evil they do every day.
--
make install -not war
Usually, the purchasing company's stock price drops and the purchasee's stock price increases. A lot of folks risk arbitrage this position when news of a merger hits the street.
Risk arbitrage goes like this: sell short the aquiring comanies stock, or buy the Puts and hedge with the stock. Buy the aquiree company's stock and or buy the Calls and short the stock as a hedge. It's not a one for one transcation. There's some ratios of how much to buy based on the volatility of the underlying stocks, risk free interest rates, and some guessing.
Of course, every transaction is different.
The reason the aquiring companie's stock goes down is because usually the merged company does worse. Synergy? Hah! Another reason is that when companies start buying others is because their earning are or have decreased and they're trying to boost performance by buying others. So either way, buying other companies is usually a hint of troubles ahead or now.
Of course, everyone on Wall Street has their own opinions as there will be after my post.
And you're right about Wall Street: in a nutshell, whatever their title is on Wall Street, their job function is sales period! That means th investor get fucked somehow!
Saturday is April 1. Slashdot will be shut down. Sorry for the inconvenience.
Many people only donate money to registered charities. Why? Because there are legal restrictions on how the charity operates. I could donate money to some idiot at my door claiming to run a charity, but without a registration number, he can go sit on the curb for all I care.
This isn't Google being evil, its you not willing to file paperwork.
- Michael T. Babcock (Yes, I blog)
'Caveat Emptor'
They said from the beginning that they wouldn't provide typical forecasts.
Nobody forced anyone to buy their stock.
Predictably the stock is less stable, and will presumeably (according to simple capitalism) be valued slightly lower because Wall Street prefers stability.
Done.
Carping about "oh they should do this" or "should do that" is stupid. You bought it, you don't like the conditions or the company, you sell it. If you have lost value, well, you've just been bitchslapped by 'the invisible hand' (plus your own unrealistic expectations).
-Styopa
It's really simple: as long as Google follows the letter and spirit of the law, then they can manage their company as they see fit under the direction of their board of directors.
Should investors prefer another philosophy they can replace the management team.
If they cannot do that, then they can sell their stock and not be involved with Google any longer.
It's really pretty simple. Analysts have no power within a company other than to make suggestions to management and to offer guidance to investors. They cannot compell Google to do anything whatsoever, so they may as well deflate their chests and get over themselves.
Boo-f*cking-hoo.
/you/ are doing some non-profit work. And how much support would be enough?
/anyone/. Just the fact that they /are/ helping people or organizations is laudable. And were I Google, I'd set a few requirements for people to receive my free and most welcome aid, otherwise I'd be helping everyone with everything, and I'd have to provide 24/7 call support as well as an added bonus.
Even though I assume that you do a great job on that website, what obliges anybody in the world to help you out based on the fact that you do non-profit work? You might just as well oblige me, or any other slashdot geek to support your cause one way or the other, just because
Google has no obligation whatsoever to help
"They give, but won't give to me" makes them evil? They are not required to give to anybody. The fact that they give at all is fairly noble, imo.
Wall St. doesn't like it, too bad. It's about time someone stood up for long term value in this country and pulled their head out of that quarterly numbers mind fuck that's all to common. I'm glad to see Google taking the lead.
Stay out of that line. Focus on value. The share price is grossly inflated right now anyway. It'll go up, it'll go down. You pays your money and takes your chances.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
We are not an incorpoated 501(c)3 NPO
There's your problem - right there. I also only donate to registered charities, and it's not for the tax deduction it's for the accountability.
---- Den ene knappen er powerknapp, den andre er Bender voice knapp "Bite My Shiny Metal Ass"
But I do wonder whether it is wise to base business transactions on "higher principles." I mean, when you hire a plumber, do you really want to discuss his personal views on the value of good pipes to society and so on?
Coca-Cola, Gillete, the Washington Post, McDonalds, and Berkshire Hathaway are just some of the companies that do not provide quarterly earnings guidance. In addition the CEO of the U.S. Chamber of Commerce recently called on businesses to end the practice in favor of better communication about long-term issues. The only reason Google seems to be singled out on this issue is because it's Slashdot.
Build a man a fire, he's warm for one night. Set him on fire, and he's warm for the rest of his life.
Forgive me, but I fail to see how doing something that makes sence for the company is somehow, "evil".
That said have you tried contacting them again, or by phone or have you just sent one letter and assumed they've ignored it?
1) Confining their philanthropy program to accredited non-profits instead of just giving free advertising to anyone claiming to be a charity seems entirely reasonable to me.
2) A tax deductible donation is hardly cost free. Surely, as such an ardent philanthropist, you've noticed this on your own taxes.
3) As someone else has pointed out, even in the worst light, not giving you free advertising doesn't remotely constitute "evil". Helping the Chinese government suppress information about Tibet does.
What I'm listening to now on Pandora...
Except to my knowledge Google hasn't issued voting stock yet.
Until they do that, and until shareholders vote in different board members or in some other way Google's corporate charter changes, the fiduciary duty is to the current charter.
They have to do what they said they'd do. If they started to behave in ways contrary to their charter, then the shareholders would have a case.
sigs, as if you care.
Stocks outperform real estate.
Google it.
GOOG is one of the best trading stocks around in the last couple months. Ride it up, ride it down, up, down, over and over. Don't change a thing! Who cares about long term stock ownership anymore, anyway? Didn't we learn our lesson about that in 2000?
I fully support Google's stance on this issue. Providing guidance is just an invitation to cook the books. What they are asking is to forecast how much money the company is going to make or lose in the next quarter/year. And *then* they are asking the same company to report how close they came to the mark. If the estimate was wrong, the shareholders may have reason to launch a lawsuit.
So what happens? The company does it's best to juggle the numbers so that they match the estimate. This is one of the reasons that accounting practices are as bad as they are -- there is a huge amount of incentive to mislead.
But not only this conflict of interest, what does a company do if they have inside information that will affect their profits in the next quarter? They can't announce the information *and* they can't give accurate numbers (because they can't justify them). So if you are planning a big cash purchase and you know that earnings are going to be low because of it, you are stuck -- you either mislead the analysists or you give them a hint that something big is coming down the pipe. Both are really bad.
But having listened to a number of analyst meetings, I am constantly shocked how clueless these analysts are. They aren't even aware of basic public information that is published in the newspaper. One company I worked for won a large lawsuit (several million dollars) from the federal government a month before the quartly results were released. It was big news in all the papers. At the analyst meeting for the results, the analyst from Merill Lynch asked where the money came from. "The government lawsuit" was the reply. "What government lawsuit?".
I think you're absolutely right. Google's way of doing things is completely unacceptable! They are obviously going to plunge their company into a financial morass of .... hold on, GOOG just dropped to my strike price. I need to go make a major purchase!
Later, suckers!
Why should I argue rationally with someone being irrational? I'll just mock them instead.
Doesn't "tax deductible" mean that they can give money without having to pay taxes on that money? That way, all the money reaches the recipient, and not only some percentage of it? They don't wan to "waste" their money on taxes.
Don't be stupid.
I think this obsession with quarters is hurting the businesses that the stock market is supposed to be helping. I've seen several instances where a stock posts very impressive per share profits, in down times even, fall a few cents short of average analyst estimates and boom, the share price drops.
I wonder if the same analyst sold them the idea to bankroll SCO in their litigation with IBM over Linux...
It's become apparent that much of the reason companies go off half-cocked and start destroying their value to either the community or to their customers is not because their shareholders freak out, but because asshat analysts who have no skin in the game whatsoever decide that they should do these things. Thus we get companies that think in 3-month cycles and act destructively for short-term gain -- and then get absorbed in the long-term into even larger, less dynamic companies. Kudos to Google for having the nuts to break the cycle.
I, for one, welcome our new financial ov.... er, privvy info financial priesth... er, too late. Never mind.
One good example of analysts being wrong is when you look at Costco vs Walmart.
Walmart has a high turnover rate, low customer satisfaction, and questionable business practices. Wall St. analysts constantly praise Walmart despite the fact their stock has been on the decline.
Costco pays its employees very well, allows their workers to unionize, and tries to be socially conscionable. Analysts lament Costco's business practices and yet their stock has been steadily rising.
Seems like some analysts are more into pushing political theory rather than what is profitable (and sane).
There is no legal requirement for a public company to provide quarterly earnings guidance, and in fact a number of large, successful public companies do not provide such guidance. Google can easily meet their legal and fiduciary requirements without providing such guidance.
Contrary to what the analysts would have us believe, companies do have some rights in what and how they communicate to the public. (Because of Regulation FD, communication to investors and communication to the public are one and the same thing.)
Build a man a fire, he's warm for one night. Set him on fire, and he's warm for the rest of his life.
You either have diminished comprehension abilities, or you are trolling.
Google cannot legally not publish quarterly statements - they are doing it, period. What they are not doing is predicting in advance what these statements will be, which has always been a guess. All the information you are talking about is available in the SEC filings every quarter.
Simply put: when you become a publicly held company you have a responsibility to your shareholders. Until upper management learns this, their stock price is going to continue to decline sharply.
Since Google has NEVER implemented guidance that means their stock price has ALWAYS declined, right? Let's forget that it started at approx $100 and is now $350 in under 1.5 years. 1.5 years is a lloonngg time on the NASDAQ.
Just funny. I live with it every day, motherfuckers.
Wall Street has had it out for Google since they went public. Remember, Google went public using an auction style system and set a price based on that. Wall Street was upset because they couldn't sell the low priced IPO stock to their cronies...and therefore lost a lot of money (and control.) Furthermore, they had Google lower it's initial value saying it was too high. But right after the IPO the stock value shot through the roof. They looked like chumps!
..they are trying to protect the status quo and maintain their lucrative business model which they put in place. Screw'em!
Basically Wall Street, now a public company, is just behaving like the RIAA and MPAA
But two and three are right out. Google already has the money from the IPO. They are profitable, unlike a lot of newly-IPO companies that pay operating costs out of the cash raised, so the cash they raised isn't going anywhere. The price of Google's stock has no affect on Google's cash in hand, and no effect on their ability to buy technology, companies, or invest in hardware.
It might have an effect on their ability to raise additional cash in the future by issuing more stock, but that's about it.
Interested in a Flash-based MAME front end? Visit mame.danzbb.com
....short term profits mentality. They buy into the casino game, and when the rules are different-just slightly-and they KNEW that in advance-they claim foul?
Nope, it's their loot, they could have decided to go elsewhere in advance. This is sour grapes on steroids from the "greed is good" crowd.. Google was very careful upfront to say what they would or wouldn't do, just because they aren't acting like other corporations with short term profits mentality isn't Google's fault, it's Wallstreet's fault for thinking they would, based entirely on something they dragged out of their lardish butts, because it wasn't based on any actual data. I think it's funny really, because you could see those neurons all scrambling to throw money at google, they got completely coldcocked.
Google said that they actually didn't know what they would be doing in the future, just exploring wild new technology and see what might work and what might not. It is loosely based on advertising sales, and that's it. Google is an *exploring new tech* company. Every single exploration left turn or right turn is not guaranteed to make some investor money. If the investors didn't understand that going in, perhaps they should have taken their money and started their own business and done something useful and productive instead, ie "get a job".
Frankly, the entire idea of investing has just turned into wild ass speculation based on the really quick buck and frantic share turn arounds. They should pass a law requiring a minimum hold period on shares between trades anyway,like one or two years, not a few hours or days or weeks, to discourage short term profits casino mentality. Put the "invest" part back into "investing".
I have zero sympathy for the stockholders and analysts in this case who were looking for the quick easy buck. None. There are plenty of other enron-esque companies out there for them to choose from if that is what they are looking for. It's like the bulk of the stockmarket,so there should be enough there for them to check out. The few companies who DARE to try something quite different in a business model and to perhaps follow at least semi ethical guidelines are *quite rare enough* without the jackals and hyena scavengers braying at them.
It's not because wall street morons do it that you should too .
Now if it was called GOO i would find it sort of funny, but GOOG ?! C'mon that's just lame.
With that aggravating beauty, Lulu Walls.
Yup. Without that non-profit charter, there's nothing to stop them from taking your $1 million donation and going to Vegas with it. Or just disappearing for that matter - wouldn't be illegal in the slightest. Running a non-incorporated charity is just dumb if you want people to donate to it. And if you don't, well, then who cares?
You're special forces then? That's great! I just love your olympics!
1. NPO registration costs money and takes an enormous amount of time and upkeep - much more than designing and running a website. There is no reason for our organization to go to the trouble or expense of registering.
2. Accountability makes sense if you're handing someone cash. If you're a search engine giving a cheritable website hits, all you have to do is look at the friggin website to do your due diligence - which you are going to do in any case.
3. Complacency, duplicity, and hipocrisy lead to evil. Remember the civil rights movement? If you're complacent about racism, you're guilty of it. If you tolerate child sweatshops (by buying shoes from Nike, for example) you're guilty of supporting evil.
4. Google is donating services in kind in exchange for tax benefits. The goal of helping others is secondary. It is common practice in all large corporations. Shell, for example, gives vastly more than Google does. But the company makes no claim to 'do no evil', nor does it place philanthropy above profits as part of its founders' vision. And shell is not considered a philanthropic organization. They give with an agenda, and so does Google - they are buying more than just the satisfaction of doing good; they are buying something that has a dollar value. That is not philanthropy or altruism.
5. Nowhere did I complain that Google did not 'give' to my organization. I am pleased that they give at all, just as I am pleased that Shell and GM and Haliburton fund various NPOs. My problem is that Google is duplicitous and hipocritical about it (where the others mentioned are not), and if I didn't state that clearly enough in my first post it is because I overestimated the cognitive capacity of slashdot's readers.
A-Bomb
That google doesn't provide guidance and the share price plummets as a result. This means I can finally buy Google at a reasonable P/E ratio.
I know the Human Fund has been asking for free Google advertising....
give me a break. Since when does "Wall Street" want "stability" in a share price? They would all be out of jobs. I agree with Google, forecasts end up being a company's publically stated goals for performance rather than merely a prediction and can drive the company to do stupid things just to meet an arbitrary number. Far too often key purchases are put off until after the end of quarter and companies go to great, sometimes harmful to future business, lengths to collect revenues before the last of the month just to meet "expectations"
I've seen projects delayed by a week or two, just so a publically traded company didn't have to spend money at the end of the quarter so they could meet expectations. I'm with Google on this one. "Wall Street" can just wait for the actual results and act accordingly.
correction. Value and Fidelity are the two biggest institutional investors of google. I think LEgg Mason is no. 3.
un burrito me trampeó.
So the reason that the Street wants these updates is that it will decrease the volatility; if you don't do this the stock will jump around a lot just after every quarterly report. There is nothing conspiratory about that, it is just a fact of life that if you learn a lot about some asset at one time, then your evaluation of that asset may change a lot at that point.
I don't see a great deal of evil or harm in the reporting itself. The problem (some would say evil) arises if the company becomes very closely managed to the quarterly results. If this happens mid level management starts micromanaging things to make the quarterly reports look better (for example, shifting inventory and sales around to make it look better on the day of reporting). Invariably these actions are shortsighted and in the long run destructive.
If senior management is strong maybe they could start with these reports but make it very clear(in words and actions), that they do not reward, and indeed do not accept, short-sighted behaviors to trim the quarterly report. I think that could be good for the shareholders without violating the "do no evil" ideal. There is nothing evil about simply telling the world how you are doing.
Tor
This has been true for a while, and a lot of people have said exaclty this. But it has not happened yet? And you want to know why. So do I.
I don't know that google is taking the right approach, but I am 100% convinced that the traditional approach is wrong these days. The market is too focused on short term profits. It's like a male dog in the midst of hundreds of female dogs in heat. It forgets about everything but, "I want some! Right now!" and it'll starve to death in its lust-- and kill anything that tries to get in its way in the meantime.
If we had reasonable analysts in a reasonable system giving reasonable LONG TERM analysis, the old system would work. But the rules have changed, and the old system is driving itself to destruction under the new rules.
Until someone comes up with a reasonable approach, and the shareholders start acting responsibly for the long term, I think Google's protest is an effective way to go.
Meanwhile, I'm starting to look at the average street analyst the way I do at the average lawyer who goes sniffing around for PC lawsuit material.
and 'evil' - those are not rigorously defined, widely recognized values like the length of a 'meter' in terms of wavelength, or (what once was) an ounce of gold is $32. Go by the mantra of 'do no evil' and you will eventually find that what is 'good' in the eyes of inventors is not always 'good' in the eyes of consumers. This is why so many wildly successfuly companies, in terms of investor capital gains, are usually so evil to their locked in customers.
try { do() || do_not(); } catch (JediException err) { yoda(err); }
I wouldn't mind some massive inflation right about now - I have $60k in student loans with a fixed interest rate on repayments & no significant investments or assets.
my sig's at the bottom of the page.
Not to detract from your point, but it's also a crime to pretend you're colecting money for a charity... if you really aren't collecting it for a charity.
In other words, collecting money for "The Mike Babcock Education Fund" is illegal unless there is really a registered charity in that name.
[Fuck Beta]
o0t!
Every time Apple posts record profits above expectations, the stock drops. Thank about that one for a second.
It doesn't mean much now, it's built for the future.
A week or so ago I posted hereabouts that it seemed like the analysts on Wall Street were intentionally punishing Google because it wasn't playing ball by giving inside information to analysts for their "projections". I thought it funny that so many news items started to crop up denigrating Google and its projects. Everywhere, even on DL.TV, there was widespread Google-bashing, or at least reporting that people were bashing Google. The stock price keeps plummeting. I speculated that analysts were at least refusing to lend a hand to stop the flood of bad news by speaking up about the company's strengths. Not attacks, just refusal to aid. I thought perhaps that they were passive-agressively sending a message to let them in. They are accustomed to the inside information. They need it to make money on the market consistently, something that normal cowpokes trading online don't do, lacking the information that the analysts hold so closely to themselves.
Damned if the attack hasn't gone full-agressive and public. The message is clear: give us the information we want, or we will do our best to ruin Google. This is extortion.
The analysts need to be regulated again. This is completely out of control.
66.64
As a sidenote, it will be 66.6 when GOOG hits $349.35.
Wall street: Wah! I want free loot.
Google:Orly? Cry more noob. Learn2Predict.
In their own terms, yes. I don't drink the Google koolaid any more than you do. As I said, selling out for billions is, IMO, highly excusable. In fact, you could tell your friends "I beat the Man at his own game, and sold Wall Street a bag of vapor for the price of a small country. Let's go set up Utopia."
But there's no need to mince words and say that it's not selling out. It's just doing it well.
sigs, as if you care.
I run a non-profit organization that is entirely web-based. [...] We are not an incorpoated 501(c)3 NPO.
You have GOT to be kidding me. You expect a company to donate cash or services to your organization, without proving to them that you follow the law regarding non profit organizations?
I could not donate to an organization that espouses even the purest of motives if that organization can't get its act together and file as a real non-profit, accountable to the law. I might as well be giving money to a con artist.
There are a vast pool of eligible non-profit organizations that ask for Google's money. By only donating to 501(c)3 organizations, Google is protecting itself and has a better chance that the money/services will not be ill-used. The tax-free status of donations is intended to encourage giving, so both Google and the organizations they donate to get something out of the transaction. Were you an eligible 501(c)3 organization, you would hardly call it slimy - you would hail it as a progressive tax code.
In giving money to non-profits, a company MUST look at the return on investment. If giving $1,000 worth of advertising to you helps 100 people, that's nice. If there's another organization that will help 500 people with that $1,000 investment, then that's better. You also need to look at whether the non-profit's goals are similar to your own. It could simply be that Google doesn't donate to any organizations regarding reproduction simply because they want to remain neutral. They don't have to publicize their policy, nor do they need to explain themselves. You are asking for money, and then suddenly you claim that you deserve it and they are such pigs for not donating to you? What rights, exactly, do you have to their money again?
As far as your implication that donations of advertising are "free" and move moeny from one pocket in google to the tax free pocket, consider what you are asking. You are asking Google to give away free advertising to any organization that claims to be non-profit. If google does that, they will have more "free" ads shown than paying ads. Suddenly it won't matter what tax break they get - they won't have money in the first pocket to move to the other pocket. They have to set a limit (for financial and legal reasons) on the amount of "free" advertising they can donate to true non-profit organizations. That limit, I imagine, is reached and therefore they don't have money left over to give to organizations that merely claim non-profit status without actually being non-profit. This is merely one of the consequences of what you are asking them to do - it's much more far-reaching and complex than this, of course.
If I were Google, I'd be wondering, "Is this an advertisement for Plan B? Should I be supporting an organization that claims to be non-profit, but will not take the legal steps necessary to demonstrate that commitment?" Actually, I'd probably not even get that far. "Oh, somone else wants money ear-marked for non-profits, but isn't a non-profit. Time for the round file."
-Adam
Without going too math heavy, there is a reason Wall Street hates volatility. While its true that 15 years ago, Wall Street made money from brokerage commissions, the main money maker is now asset management fees, etc... It used to be a fortune to do a trade on the street, now its $19.95 (or $7 with some deep discount brokerages).... that's not where the money is.
If they manage an account and collect 1% as a fee, then the larger that account gets, they better they do. Now they could outperform the market to make extra money, but with only 1%, that's too much work. Market growth is the easiest way to grow.
Also, there are two ways to grow a companies's stock (assuming you believe that earnings matter in the long run), increase the underlying company's earnings (but that's work), or increase the P/E ratio (or FCF, or whatever ratio you like).
The assumption is that the price of the stock today is the NPV of all future cash flows (or dividends, which is theoretically the same but a harder model in the real world)...
So to increase the value of the stock, you can increase future cash flows (work), or decrease the discount factor...
Well, since most models of stock valuation demonstrate that Beta is a decent indicator of the "risk premium" (basically, discount factor = risk free rate (treasury bills) + Beta * (market premium)), so if we want to decrease the discount factor, we can decrease the rate of the treasury bill (out of our control), decrease the market premium, (out of our control), or decrease the Beta.
If Wall Street convinces Google to disclose more which reduces volitility (an interesting assumption, but let's pretend), then Beta goes down, discount factor goes down, and Google's stock price goes up...
With Magic, we've created value, our asset holding fees go up, we get a huge bonus, and most importantly, nobody had to do any ACTUALY work (like increase earnings) to get it done!
Alex
If you're not obsessed with quarters, then what do you care if the price drops? In the long run the price will reflect the proper value. Warren Buffet, for instance, doesn't care one whit about things like that.
All your comment shows is that you don't know how insider selling works or that you're purposefully trying to stir up a conspiracy.
I suggest you read this article.
http://news.com.com/2102-1030_3-6030223.html
Summary: Their stock sales were planned over a year advance. They actually setup the schedule before Google went public, so that n00btards like you wouldn't be able to say "ZOMG, teh c0nsp1racy!"
AFAIK, just about every corporate officer signs up for a 10b5-1 plan so that they don't have to deal with accusations of insider trading. The funny part, is that the linked article I gave you has some idiot analyst saying the same thing you are.
Allow me to say this again: The stock sale was planned over a year ago. It is an unfortunate coincidence that their stock sale happened at the same time as any bad/good news.
The fact that Google's stock dropped 60 dollars per share in less than 10 seconds is interesting, but the rest of your post is over rated.
[Fuck Beta]
o0t!
"2. Accountability makes sense if you're handing someone cash. If you're a search engine giving a cheritable website hits, all you have to do is look at the friggin website to do your due diligence - which you are going to do in any case."
So, looking at a website constitutes due diligence to you? Perhaps you should reconsider this statement.
"The government grants you rights, not the other way around."-- beav007. Yes, these people really exist...
If you care so much about your charity and organization you'd file for 501c3. This is a very simple thing.
1. It'd allow for more businesses to donate to you. It's not only about a tax deduction but THEY need it for themselves so THEY don't get taxed on money they are providing. Otherwise you get LESS funds as they have to cover the taxes.
2. There is a limit they can give if you're not a 501c3. A company just can't GIVE you a donation.
You clearly aren't concerned about your charity or organization or you'd get it not for profitted. If you're a for profit charity then you really aren't practicing charity. In which case your major goal is PROFIT and that my friend, isn't what charity is about.
In the case you feel you need a for-profit arm. You start a seperate organization and keep the books open and clean as to why your not for profit is hiring or using the services of your for profit for whatever reason.
This isn't google being evil. On the surface it's you being incompetent and clearly ignorant to how these things work. You shouldn't be running any sort of volunteer/charity service.
Google doesn't want to give guidance because it forces them to become short term focused to satisfy expectations they set for Wall Street. This is the bane of existence for many publicly traded companies. They give guidance and if they don't hit their numbers, they are punished by the analysts. It makes the analyst's job easier in that they can then put more pressure on the company (Google) and site them for the failure.
The problem is that once a company becomes short-term focused they are beholding to hitting numbers and making bad business decisions simply to hit those numbers. This short-term focus trickles down from the CEO to all decision managers in the company who are given stock options. The company can no longer take long-term gambles because Wall Street will punish them for missing or not increasing their short-term outlooks. The decision makers will feel a real financial loss for not hitting those numbers and therefore reinforce short-term decision making.
Conversly, long-term focus is the advantage of a privately held corporation. A private corporate can make long-term decisions that cost millions of dollars in hopes that it will pay 3, 5, 20 or even 20 years down the line. A short-term company can not make such decisions and therefore must focus on short-term growth or growth through acquisition (i.e. buying the competition to increase short-term revenue). A private company can not raise cheap capital to make these long term investments like a public company. Google wants the best of both worlds, they want to use cheap capital (i.e. stock sales) and use the money to make long-term investments.
... and managed to come off as a self righteous and immature jerk.
Look, the minimum google requires is your NPO registration, you fail to meet that requirement. It seems like google is helping a lot of orgs that meet this requirement, but you just don't qualify.
You can't prove they do this only for tax benefits, but even if they do, what's your objection. Obviously they can't help every organization in our world, if they have to pick some, they might as well pick those who also benefit them for tax purposes. This is perfectly understandable to any normal human being.
In addition, it's already being mentioned that the registration at least provides some accountability to separate scammers from real charitable orgs. Even if google is only giving free ads and not money, that is giving something of value, and it would be irresponsible to give this to any quack with a website out there.
- sigs are for wimps.
Stocks grow faster than real estate, but with more volitility, and depending on your views of CAPM, that explains it or doesn't...
.5% over inflation
That said, when you buy real estate, going 500% long (putting 20% down) is EXTREMELY conservative, and 1000% long is extremely common, even in business settings.
In the stock market, you can at MOST go 200% long.
In addition, the cost of capital (borrowing the money) is MUCH higher for stocks... You might be paying 7% or 8% of Margin Interest, vs. 6.5% on mortgage interest.
Basically, the stock market DOES outperform real estate significantly... but it doesn't...
In the long run, the "risk-free rate" is something like 4.5% with inflation of 3% (there are the gold standard years or 0%, plus hyper inflation, but whatever)...
Long run rates:
Inflation: 3%
Risk Free: 1.5% over inflation
Real Estate:
Stock Market: 8% over inflation (depending on time periods viewed of course)
So while the stock market looks good...
$1 invested in the stock market makes 8 cents in year 1 after inflation, or 11 cents if we went 200% long and paid our margin rate...
$1 invested in real estate BOUGHT $10 of real estate, each of which grow by 3.5% before inflation, so we made 35 cents, lost 3 of them to inflation, and ended up 32 cents, so we made a 32% return. This requires ONE HUGE assumption, we were able to collect in rent enough from the real estate to cover the "holding costs" taxes + interest. If we don't, our return goes WAY down.
Real Estate does out perform the stock market, because it is lower risk and people give you money at lower rates...
Alex
A Long, Long Time Ago, In A More Moral Age . . ..
..
Investing was about taking money that you have, and using it to help someone else do something you thought needed to be done. Usually, if they proved successful, this meant that the value of the effort you supported grew, and you could sell the portion of that business which you owned if you so chose.
Oh, and if the endeavor was wildly successful, there would enough of a surplus of money you could get paid without losing any of your interest in the endeavor!
Today's investment system doesn't care what the company being invested in is trying to do, all that anyone cares about is whether the stock will A) pay dividends which can be used as income (and this portion of the marketplace appears to be dwindling) or B) grow in value so quickly that you can sell your interest in a matter of days or weeks and make a profit.
Investing used to be about creating products, services, business and livelihoods. Now it is about sucking everything out of a company you can, and moving on to the next company.
Google said (my interpretation) that they want to cater to the original idea of what investing is about.
The guys who drive the current version of investing are trying to force Google into the paradigm by which the analysts even exist in the first place . .
What I don't understand is why any of this surprises anyone who's paying even the least bit of attention.
The whole "controversy" over wether Google should or should not being doing what it's shareholders want is kind of funny.
To partake in the amusement remember that Google is doing what its current shareholders want. Including their two biggest shareholders, Sergey Brin and Larry Page.
Can you believe that in this day and age the NYSE still has humans in the loop? How is it that, on the NYSE stock exchange, purchases/sales are not handled entirely by machines? The answer is that to do so would eliminate the opportunities to
NASDAQ is automated and completely transparent; NYSE should be the same. But Wall Street will fight modernization tooth and nail because it endangers their jobs. Problem is, they're dead weight and a drag on the economy.
Google should respond by developing an investment system that takes advantage of NYSE's built-in delays that arise from humans in the loop. Secondly they should build a "Google Exchange" and free the markets from Wall Street dominance.
1. NPO registration costs money and takes an enormous amount of time and upkeep - much more than designing and running a website. There is no reason for our organization to go to the trouble or expense of registering.
The fee depending on if you get help or not is between 200-500 US dollars. For the lifetime of your NPO. I'm not sure what upkeep you're speaking of. There is little to upkeep..There are even companies that'll do the whole thing for you lock, stock and barrel.
2. Accountability makes sense if you're handing someone cash. If you're a search engine giving a cheritable website hits, all you have to do is look at the friggin website to do your due diligence - which you are going to do in any case.
Anything giving to you is a resource. Resources cost money.. You think anyone in the world including yourself is going to allow someone to use their resources without some accountability? You're gonna give emergency birth control to some dude just because he asks? How do you know hes then not going to turn around and ask for 500 units and BURN them becomes he's anti-abortion? Right.
4. Google is donating services in kind in exchange for tax benefits. The goal of helping others is secondary. It is common practice in all large corporations. Shell, for example, gives vastly more than Google does. But the company makes no claim to 'do no evil', nor does it place philanthropy above profits as part of its founders' vision. And shell is not considered a philanthropic organization. They give with an agenda, and so does Google - they are buying more than just the satisfaction of doing good; they are buying something that has a dollar value. That is not philanthropy or altruism.
ITS DEDUCTIBLE.. it's not a benefit. The money is coming from somewhere.. It just didn't drop out of a tree. They can spend the money in taxes, or they can spend the money in helping charitable organizations. They maybe able to rework some of the value if they really wanted but at the end of the day they still pay.
Well unless they are Microsoft and rework to the point where they have a small unit in a tiny island somewhere making sure they don't pay anything.
YOU ARE NOT A NPO UNTIL YOU FILE THE PAPERWORK. You're simply a guy with a website asking for donations.
There are plenty of articles on this subject that don't mention Google at all, and do mention the companies I listed (how do you think I learned about them--I'm not a stock broker) as well as others.
What Slashdot did do was decide to post this article here, and not one of the articles about the other companies that don't (or are planning not to) offer quarterly guidance. Why? Because this is a tech site and Google is the highest-profile tech company facing this issue.
Show me Slashdot wrote the article and I'll agree with you that the focus from Walstreet is on Google because it's slashdot.
The focus from Wall Street is not (just) on Google, it is on the issue of quarterly earnings guidance in general. Google is simply the focus of this particular story, which was then posted on Slashdot. Don't assume that just because Google is the focus of this story and discussion, that it is somehow the lynchpin of the entire issue. It's not.
Build a man a fire, he's warm for one night. Set him on fire, and he's warm for the rest of his life.
Start saving up some Euros then.
-mkb
The US borrows in its own currency unlike the rest of the world, so if the currency is devalued, the guy we borrowed the money from suddenly gets paid a lot less.
Yes, and so the guy we borrowed the money from (i.e. the lender) will ask for a higher interest rate next time. You know how the saying goes: "Fool me once..."
Thus, a weakening currency means higher prices and higher interest rates. Please don't think we can inflate our debt away without any consequences...
But common sense tells me if you don't like how someone is running their business voice your opinion with your wallet. In other words, if you don't like Google rolls; drop their stock.
Insert Sig Here
...but they're forecasts are just in Beta? ;)
"how can they call it a MINE if everything here is THEIRS?!?!" -Straight Jacket
Ok, we have a major disconnect here.
Companies are under no obligation to provide "guidance" on future earnings or growth of the company. A company is obligied to publish its 10K and 10Q forms as well as other required SEC filings. These documents - for those willing to do the work - provide more than enough to analyze a company and its business.
In fact, the "guidance" you and the analysts are demanding has been the source of untold harm. Remember, it was Enron working to ensure that it hit its earning's guidance and estimates that led to the fruad to keep the numbers on track. It is trying to keep earnings estimates on track that leads many a company to dump staff to "cut costs", rather than accept "lumpy earnings".
It should be noted that there are other companies that refuse to provide guidance. Companies like Berkshire Hathaway (i.e. Warren Buffett's company). What the analysts don't like is that they aren't in control here. That in analyzing Google they might actually have to do some work.
Like many of those at the Motley Fool, I applaud those who refuse to give into the demands of the analysts and give earnings guidance. Of course, this could be a case of trying to "get even" with Google. Remember, they were the folks that selected the "Dutch Auction" for their IPO and had to deal with the investment bankers and analysts who were upset that at market rather than their experts got to set the price for Google shares.
Yours,
Jordan
GOOG's price today is just over double what it was a year ago. As a long investment (by long I mean more than 3 months), that's real fucking good, even for the dotcom boom days.
This is why I hate stock traders. What sucks is that we willingly allow these short-sighted, instant-gratification, panicky, selfish fucktards to determine our economy.
Terrorists can attack freedom, but only Congress can destroy it.
> ..., *you* are not their customer. Your clicks are what they sell to their customers, advertising companies.
Money is not the only valuable thing in the world. The time *he* spends on google's search portal, possibly clicking on an ad, is just as valuable. Because without its online visitors google wouldn't be what they are today.
If you don't like how Google is doing business, don't buy Google. Google fully discloses their corp. philospohy in their prospectus. If you are an analyst, you don't matter because despite what you say they are profitable.
Investing in a profitable company? Horrors, we can't have that. Gives all the crap analysts and brokerage houses are pushing a bad reputation! You need to buy the blue sky buzz word of the month pump-and-dump being touted on TV. Not some innovative company with large sales and a good product line!
I wonder. Google has pissed off DOJ and Wallstreet. It isn't the first time the Wallstreet crowd or the Bushites have played dirty.
In addition, there is a tradition in business of demanding conformity. If you stand out in a corporate culture you are either pecked into conformity or eventually fired for trumped up reasons. Very much like high school in some ways.
It will be interesting to see what happens. As long as they are profitable they do not have to change. Can they last long enough to change Wallstreet? Or are they doomed to cave in?
putting the 'B' in LGBTQ+
Google is just following good business practices in refusing to adopt a short-term earnings business slanted model. Since wall street wants to predict and analyze something they have no fundamental clue about, even with guidance they'd make bad predictions, which is bad for everybody. For Google to do things 'the wall street way' would substancially hurt their profitability, and be irresponsible to their shareholders, to whom they actually are responsible. For a business to become so dependant on Wall street capitalization that they change how they do things to suit wall street is likely a death knell or a sign of a long downward slide. People who know nothing about how to run a business should have zero say, especially in terms of short term considerations, which are by definition what WS deals with.
Other companies that run their own business without WS intervention (i.e. no earning guidance): Coca-Cola, Gillette and The Washington Post.
"We are all geniuses when we dream"
- E.M. Cioran
That rule exists to keep Google's books clean. Otherwise, my grandmother could set up a "charity" to funnel money out of google and into, oh say Larry's mother's pocket.
Don't be such a tool. Register for the damn 501(c)3s and grow up.
Brilliant, so simple yet so real!
A similar analysis can explain why Wall St. pushes so much for companies to replace capital with debt. A magical way to increase earning per share without doing any actual work.
It would be nice to be sure of anything the way some people are of everything.
Of course some people will argue that these people perform a value function. Yes they do, but, they don't have enough knowledge of the internal operations of the comapnies to make a better estimate than the management of the company.
Yeah but any information Google released would be Beta anyway. :-)
Support Right To Repair Legislation.
So many of you are coming out to defend a company not providing any guidance leads me to believe that you own no stock. A public company, particularly one that doesn't pay dividends, has a responsibility to its shareholders and potential would-be shareholders to provide some info so they can determine whether to buy or sell. A stock that doesn't pay dividends is worthless in practical terms until it's actually sold. Investors need info so they can make buy/sell decisions.
Some of you are saying, "screw the (short-term) investors, some buy stock not to make money, but because they believe in the company's ideals". That is lala-land talk. What percentage of GOOG shareholders today own that stock simply because it's "cool" or "righteous" and don't give a damn about loosing money? Yes some people buy a handful of shares in a company just because they like it, and since it's only a handful of shares they don't care whether the stock goes up or down because it's not a big deal. But GOOG's price ranges from $300-$500 per share on any given day. So it's very expensive to buy a handful of shares of GOOG just because you like the company. No, most of GOOG's shareholders do care about the stock price (particularly since GOOG doesn't pay dividends) and therefore the real financial state of the company.
The funny thing is that if this same article were written about MSFT rather than GOOG, the Google sycophants around here would be taking the exact opposite stance.
-- "I never gave these stories much credence." - HAL 9000
Damn!
When is someone going to hand ZONK a clue stick? Doesnt it bother anyone at slashdot that he is single-handedly making the site look like a mouthpiece for paid shills?
No wonder his 'articles' get the lowest repsonses. Most people are probably blocking his 'submissions' by now.
Except you didn't really create any value, you only captured some of the value that wasn't already present in the stock price. It was a fine and nuanced explanation, but it confuses the price of the equity with its intrinsic value, which muddles the argument somewhat.
>One huge problem with U.S. companies is that their upper management
>folks are compensated with stock options (or grants) and are often
>based on current performance.
Actually, the options and grants are part of the solution. They were aa reformist reaction to the complete disalignment of the interests of management (perks, such as gold faucets in the washroom) and ownership (profits).
The *purpose* of the rise in options was to align the interests. Things didn't turn out as well as expected, however. Management attention was redirected towards profits, but only short-term profits. On top of that, options pay off for an increase, but have no penalty for a drop in price, encouraging excessive risk. Furthermore, as a practical matter, the executives need to either sell the stock from the options, or to come up with large amounts of cash to keep them. This brings things back to the short term, as does the loss of the options when leavintg hthe company.
OK, and investors looking at short term results, rather than focusing on the long run, is a really serious problem--buying a company for the short term results is bubble behavior at its worst.
My solution is to replace the options with outright grants that are restricted for longer periods, without regard to whether the recipient is still employed with the company. You will have this stock for the next ten years (and perhaps some tied to fifteen and twenty), so foucus on that. There are tax issues (the entire grant would be taxable; perhaps encumbering it with a non-forgiveable loan to reduce the value would help).
hawk
Honestly, why the hell haven't you filled out the forms to become an official 501(c)3 NPO? Yes, it's time consuming and requires much more management, not to mention the probable initial outlay of funds to a lawyer in order to get your 501(c)3 application completed properly. The only reason that I can see for you not to go through the process is that you are either 1) lazy or 2) not very committed to your cause, since you seem unwilling to make the necessary changes to your business in order to achieve NPO status.
In another life, I was a founding member of a 501(c)3 corporation. Yes, it's a PITA to run things in the manner necessary to maintain your status, but it's necessary. The reality is, and keep in mind that this is born from experience gained while attempting to garner some minor intial donations to fund our application, the only way to actually be treated like an NPO is to be able to prove that you're an NPO. Otherwise, why should any corporation or private entity believe your word that you will not take their money and run when there are no legal restrictions to keep you from doing so. I happened to us on a few occasions, but we never got angry and claimed the company was evil on public message boards. Instead, we simply moved on until we achieved the necessary funds to receive our NPO status. After that, the companies that turned us down before had no problems donating to our cause.
A not for profit company without 501(c)3 status asking for donations is akin to a bum on the street asking for money for food. Sure, he might be telling the truth, but how do you really know that he's not going to waste the money on crack?
For the record I forwent modding your post down in order to post in this conversation in the hopes that you might realize the ridiculous nature of your comments.
Besides, I'm sure somebody else will mod it down anyway.
If Murphy's Law can go wrong, it will.
This is one of tens-of-thousands examples of unjustified censoring.
... press@google.com.
http://www.harrysnews.com/pgmenissues.htm
NOTE
Google provides free space on sites where hostile people can freely refer to non-white men as nig##rs. Google also places adverts in these spaces. However, Google has blocked all advertising on this Men's Issues page on the grounds that it is 'inappropriate'.
In other words, as far as non-white men are concerned, the huge muscle of Google is used to support those who call them ni##ers - and Google, of course, also makes money from their activities - whereas a page like this which is intelligently concerned about the serious issues which such men face is deemed 'inappropriate content'.
Alongside reams of text wherein women are referred to as cu*nts and wh*res, Google advertises, among other things - such as cars - a whole range of sex paraphernalia.
But, according to Google, this Men's Issues page consists of 'inappropriate content'.
You can email Google here
However, I don't think that the generalists on Wall Street should be in the business of making a company run one way or another - it is not incumbent on investors to decide company policy.
Wall street isn't telling them to run this way or the other. All they're asking is that Google tell them which way they're running and how fast they expect to run.
They aren't trying to decide company policy.
-Shaunak
...swinish one. Google *has* a "long term strategy", it is to explore new technologies. You don't know what that is until you get there, hence the word explore. Google is a company run by techs. They do tech. New cool tech is their primary focus. It is that simple, but apparently that is just too complex an idea for these sniveling analysts. If people want to give them money to do tech, that's their decision. If they can't read, they need to go back to school.
Not google's fault or my fault if these perpetual quick buck hustling middlemen skimmers can't understand that part, or the "do no evil" part. Like I said, let them go find the next enron complete with megacrooked CEOs if that is what they want. They are so used to that's how business is usually done, when it's not they start whining like little babies. Tough noggies for them!
I could care less about the profits of the wallstreet skimmers and hucksters, let THEM go do something unusual and useful and productive.
Many forget that guidance targets also help long term investors analyze the stock according to growth rates and trends projected within the company. Combine that with fundamental analysis they create discount models (dividend, abnormal earnings...etc) to predict the long-run fundamental value of a company.
As seen from the swag guesses of 600 from analysts, they have no idea how to price a share of the company. Without some idea of growth rates or fundamentals GOOG is letting investors flap in the wind uncontrollably. This is both foolish and unethical, especially in a tech company that is hard enough to gauge.
Many are forgetting that WallStreet isn't just a collection of ibankers looking to make a buck. It is also composed of sell-side analysts who sell research to pension, mutual, hedge funds, individual investors, large corporations...etc. They *NEED* that information to set a good market price.
Essentially, what GOOG is doing is disintermediation of the financial markets. Trying to let the investors set their own price. However, without guidance from those who do this stuff full-time and have investment experience, the market is just a collection of ill-informed people trying to day trade, and doing poorly at that. We have seen what happens when investors are mislead, ignore, or abuse analyst reports.
To the person who said CCE (coca cola) and others don't give earnings targets, you better check your facts.
Finally, to those who say analysts are greedy and desire inside information. Regulation FD states that they cannot get inside material information but *CAN* formulate their own theories based upon the mosaic principal. The days of Grubman and Blodget are mostly over, analysts are now separate from ibankers in a much more stringent policy.
GOOG is being very unethical in their practices.
The reason why Google's policy is unfortunate is that it precludes contributing to any organization that does not have 501(c)3 status. That is a shame in the case of web-based organizations, since they stand to so readily benefit from Google's particular form of contribution: ad space on Google.
So for example, an organization in Iran that publishes a women's rights website to help women avoid horrid oppression and abuse in the form of sexual slavery, genital mutilation, and so on, would have to register as a 501(c)3 in the United States in order to be eligible. Ahhh, suddenly the responders' objections and rationalizations are rendered in an entirely different light. It is more than slightly revealing that ALL posters have assumed I am an American living in the United States and operating our site from there - no longer true, though it was when the site was made several years ago. In the case of the Iranian women's rights site, common sense says that Google could quite easily look at the site for 30 seconds and determine whether or not it was worth contributing to - and follow up with periodic 5-second checks to prevent scamming - but that is against policy. Why? Does their policy exist for accountability? Does it exist as a filter or quality control measure? Does it exist for their own legal protection so they don't, as one laughable responder suggested, imbezzle 'funds' in the form of free ad space to inside interests? Of course not.
Wake up people. It is for money in the form of tax deductions. It is simply a business decision guided by financial logic, and no more complicated than that. The other rationalizations responders are posting are like rationalizations for Bush's war in Iraq: naive, desperate, and sad. Google's CSR policy, guided by transparent non-philanthropic self-serving financial logic, is no different than that of any other major corporation. But that policy is inarguably hipocritical in the face of their saintly 'do no evil' mantra and their founders' claims that philanthropy is the primary concern, ultimate goal, and driving force behind Google.
A-Bomb
Owned
"They didn't give us money, therefore they are evil!1!"
Uhhh-huh. I suspect their policy has more to do with easily avoiding fake charities than anything else. You may think your cause is obvious, but there are many con-men out there who are skillful at putting up an attractive front.
We live, as we dream -- alone....
Well, what would you expect from a company that makes at least 50% of it's revenue from Click fraud. Refer to Googles recent settlement (gee slashdot, why wasnt this one on the front page?) foxnews.com/story/0,2933,187284,00.html
What would you expect from a company with practically no revenue growth prospects?
What would expect froma company whose IPO was nothing more than a 2.2 billion + pump-n-dump scam?
What would expect from a company whose insiders have made billions off the sale of the stock WITHOUT EXPENSING IT?!?! Eric Schmidt recently sold about 100 million in stock in one day (Feb 22).
What would you expect from a company whose has refused to comply with the new FASB rules requiring expensing of stock options?
Google makes a great search engine and some other great products, but realize that none of that justifies a stock price of over $100 / share.
If your pride can handle it, read this blog: http://www.fuckedgoogle.com/
Do some research on Click Fraud, and realize how google really makes its $.
nice explanation, but are you saying that i can create money out of nothing ???
So now we know who is the true 'evil' behind any company that plays by Wall Street rules...
maybe google should start its own version of wallstreet.
FTA - "'It is in the interest of all shareholders, including the company's employees and officers, that the share price achieves some stability.'"
Perhaps, it is, finally.
Over $400 for one share is completely unsustainable when the company is mainly selling non-tangible items and giving away a plethora of expensive-to-maintain services. Companies that sell durable goods may have higher operating costs, but if demand exists, they can always profit. I don't see demand for Google and their advertising model remaining as strong in the next five years. I have a feeling that some other player will want a bite and try to offer the same thing. Microsoft was courting AOL heavily until Google beat them to the punch for more advertising markets. Google knows that they are reaching an end to how many strategic advertising partners they can reach lest they look like the next (evil) 800 lb. gorilla. Let's not forget the meteoric rise of many tech companies' stock values. They were completely overvalued. Thus, the 'bubble' burst.
The many crises that Google now faces are its growing-pains (DOJ, Librarians, China, etc.)
The truth is that money talks. When quarterly P/E reports are announced, then they are ultimately responsible to their shareholders.
No sig for you! Come back one year!
Oops, so much for that cup I had on top of my fridge in college.
... " can get you into a lot of hot water though.
Honestly though, its a court-decided type issue.
If you don't claim to be a charity, you probably won't have a problem.
"We are a charitable organization
- Michael T. Babcock (Yes, I blog)