Analysts Call IBM Layoff Estimates "Hogwash"

jbrodkin writes "Rumors have been floating around saying IBM will cut 150,000 U.S. jobs, but a Network World story attempts to set the record straight by quoting analysts who say this news, if true, would wipe out the company's entire U.S. operations and would make no sense since IBM is actually doing pretty well."

Comments

Never underestimate the lure of the dark side...

[kcbrown]

"Rumors have been floating around saying IBM will cut 150,000 U.S. jobs, but a Network World story attempts to set the record straight by quoting analysts who say this news, if true, would wipe out the company's entire U.S. operations and would make no sense since IBM is actually doing pretty well."

It's all about short-term stock price manipulation (which I call the "dark side" since it ultimately winds up being a loss but brings instant gratification).

If the CEO is retiring soon, then he has little incentive to do right by the company in the long run, and plenty of incentive to play games to increase the stock price in the short term (so he can sell off his shares after the price goes up). A massive layoff like this would be entirely consistent with that scenario. And it's not like the company's "investors" would give a damn about the long-term outlook of the company anyway. After all, it's all about the growth rate of the stock, and fast growth for a short time is still fast growth that "investors" can take advantage of. They just have to dump the stock before it crashes.

So not only is a massive layoff of this scale plausible, I think it's highly likely. It's just the ultimate manifestation of the short-term thinking that American "businessmen" are so infatuated with.

About the only thing that might prevent it is a huge backlash against IBM by "investors", which is possible but doubtful IMO.