[jscode]

>> Having dealt with 2 PE exists, rarely is the proposal something as upfront and silly as slash everyones pay.

Agreed, but a gradual erosion can occur over the course of several years. PEGs and the operating company's management team have massive incentives to hit their growth metrics. If decreasing 401K contributions helps management hit their EBITDA target, many would argue that they should do exactly that. However, the impact of these decisions accumulates over time and can eventually derail a company's performance.

[TheOtherHobbes]

The reality is that this kind of stupidity is built into accounting systems. It's not even the people with the spreadsheets. They're doing what they've been taught to do. It just happens to be completely wrong-headed - if you're interested in tangible long term growth and not quarterly plunder which moves money around without seeding genuine real value.

Which is why companies can "grow" in accounting terms while actually being hollowed out as going concerns with a future.

Likewise with the planetary economy, which appears to be growing financially while in ecological terms it's almost literally eating its own seed corn.

A better approach needs a revolution in accounting. Current accounting practices are built on so many false assumptions they cannot possibly produce lasting long term opportunity, except for a tiny minority of exceptionally and unhealthily privileged people.

[mahkeiro]

Just look at Intel to see a company that was managed by the accounting people. Great numbers for a few years, large dividend, etc, but now they have to spend billions and billions to put the company back on track and give it a future.

[erosenbe0]

Disagree. Intel has had continuous dividends for at least 30 years.

Few giant American companies have been as consistently successful as Intel. I can think of only Microsoft, one or two energy conglomerates like ExxonMobil, a telecom or two like Verizon, and maybe a bank like Goldman Sachs.

[projektfu]

Abbott Labs, CR Bard, Deere & Co.

Something about staying in your lane while increasing opportunities in that lane seems to be a good long-term formula.

[erosenbe0]

Yep, Bard is part of BD, which is a large beast. Abbott/Abbvie always has something going for them. UnitedHealth has done well for years and years as it has grown. There might also be a stable industrial I am forgetting like a chemical company or 3M.

But overall, giant companies with 30 year runs of knockout growth and/or dividends like Intel are Cinderella stories. Google will be the next one to qualify in a few years I suppose.

[mahkeiro]

Sorry should have been more precise but I was also counting in the very large stock buyback that came to a end in early 2021.

[snovv_crash]

It can be more insidious than that. For example, as time goes on more and more of the engineering might be shifted from product development to contracting. In this way you see revenue growth without realising that there is a hard limit and you're throwing away the company's future.