▲ 656 ▼ Nvidia insists it isn’t Enron, but its AI deals are testing investor faith (www.theguardian.com) submitted 10 months ago by themachinestops@lemmy.dbzer0.com to c/technology@lemmy.world 100 comments fedilink hide all child comments
[+] U7826391786239@lemmy.zip 24 points 10 months ago (6 children) [deleted] permalink fedilink source parent hideshow 6 child comments replies: [–] wewbull@feddit.uk 20 points 10 months ago (4 children) The company doesn't care if the stock price hits $1. If the company is paying it's bills, it just continues. It's the people who hold shares that care. The company doesn't hold shares in itself. Enron collapsed because the company financials collapsed, not because the stock price collapsed. That happened after all the bad accounting practises and hidden debt came to light. Now, in that case the shareholders succeeded in suing for their losses, but they only had a case because of the mismanagement. permalink fedilink source parent hideshow 4 child comments replies: [–] UnspecificGravity@piefed.social 16 points 10 months ago (1 child) The company absolutely does own shares of itself and it's ability to secure credit and just engage in business in general depends of the value of that holding. permalink fedilink source parent hideshow 1 child comment replies: [–] wewbull@feddit.uk 3 points 10 months ago No. The board can decide to issue more shares, but this is a sub-dividing of the already issued shares and so normally requires a vote from the shareholders. Major shareholders normally sit on the board, so the two groups overlap but are legally distinct. If a company buys it own shares, it's normally a "buyback" and the shares cease to exist. permalink fedilink source parent [–] panda_abyss@lemmy.ca 7 points 10 months ago (1 child) It does impact employee morale when they get paid with stock incentives and they go to zero. permalink fedilink source parent hideshow 1 child comment replies: [–] wewbull@feddit.uk 3 points 10 months ago Of course. They are shareholders. The company is a separate legal entity though. permalink fedilink source parent [–] panda_abyss@lemmy.ca 2 points 10 months ago You can't really bail out a stock price though... I guess you could provide a guaranteed backstop to sellers and funnel the stock to the government, as Trump seems to love doing, but then you end up with a $3T of over-valued assets that you can't do anything with. permalink fedilink source parent
[–] wewbull@feddit.uk 20 points 10 months ago (4 children) The company doesn't care if the stock price hits $1. If the company is paying it's bills, it just continues. It's the people who hold shares that care. The company doesn't hold shares in itself. Enron collapsed because the company financials collapsed, not because the stock price collapsed. That happened after all the bad accounting practises and hidden debt came to light. Now, in that case the shareholders succeeded in suing for their losses, but they only had a case because of the mismanagement. permalink fedilink source parent hideshow 4 child comments replies: [–] UnspecificGravity@piefed.social 16 points 10 months ago (1 child) The company absolutely does own shares of itself and it's ability to secure credit and just engage in business in general depends of the value of that holding. permalink fedilink source parent hideshow 1 child comment replies: [–] wewbull@feddit.uk 3 points 10 months ago No. The board can decide to issue more shares, but this is a sub-dividing of the already issued shares and so normally requires a vote from the shareholders. Major shareholders normally sit on the board, so the two groups overlap but are legally distinct. If a company buys it own shares, it's normally a "buyback" and the shares cease to exist. permalink fedilink source parent [–] panda_abyss@lemmy.ca 7 points 10 months ago (1 child) It does impact employee morale when they get paid with stock incentives and they go to zero. permalink fedilink source parent hideshow 1 child comment replies: [–] wewbull@feddit.uk 3 points 10 months ago Of course. They are shareholders. The company is a separate legal entity though. permalink fedilink source parent
[–] UnspecificGravity@piefed.social 16 points 10 months ago (1 child) The company absolutely does own shares of itself and it's ability to secure credit and just engage in business in general depends of the value of that holding. permalink fedilink source parent hideshow 1 child comment replies: [–] wewbull@feddit.uk 3 points 10 months ago No. The board can decide to issue more shares, but this is a sub-dividing of the already issued shares and so normally requires a vote from the shareholders. Major shareholders normally sit on the board, so the two groups overlap but are legally distinct. If a company buys it own shares, it's normally a "buyback" and the shares cease to exist. permalink fedilink source parent
[–] wewbull@feddit.uk 3 points 10 months ago No. The board can decide to issue more shares, but this is a sub-dividing of the already issued shares and so normally requires a vote from the shareholders. Major shareholders normally sit on the board, so the two groups overlap but are legally distinct. If a company buys it own shares, it's normally a "buyback" and the shares cease to exist. permalink fedilink source parent
[–] panda_abyss@lemmy.ca 7 points 10 months ago (1 child) It does impact employee morale when they get paid with stock incentives and they go to zero. permalink fedilink source parent hideshow 1 child comment replies: [–] wewbull@feddit.uk 3 points 10 months ago Of course. They are shareholders. The company is a separate legal entity though. permalink fedilink source parent
[–] wewbull@feddit.uk 3 points 10 months ago Of course. They are shareholders. The company is a separate legal entity though. permalink fedilink source parent
[–] panda_abyss@lemmy.ca 2 points 10 months ago You can't really bail out a stock price though... I guess you could provide a guaranteed backstop to sellers and funnel the stock to the government, as Trump seems to love doing, but then you end up with a $3T of over-valued assets that you can't do anything with. permalink fedilink source parent