Intel's CEO Just Sold a Lot of Stock
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He knows what it means to cut down to bare minimum, and this could be considered a signal that he feels he could get more than the forecasted % elsewhere, and that he doesn't feel holding on to the stock is worth the negative backlash that is sure to happen with such a move.
Possibly. But it's possible that he did it on the assumption that US tech stocks are already overvalued and anticipates a correction soon.
Yes, he likely isn't "all in" on Intel stock right now, but does that necessarily mean that it's specifically Intel that he thinks has problems?
Or is he expected to believe that Intel shares are in fact so undervalued that they represent the best investment he could possibly make? Or to voluntarily maintain investments in what he believes is a comparatively suboptimal vehicle merely to "take one for the team"?
In other words, why would one expect, let alone demand, a CEO to make what he believes are poor financial decisions in his personal life?
As for being "invested in the company", once you reach the level of Fortune 50 CEO, the concept is basically nonsense: practically speaking, no matter how poorly you invest or perform, barring criminal prosecution, you'll still end up financially better off than nearly everyone else in the world, including many, if not all, of your peers.
Just how many of his eggs does he
need to keep in that one basket?
For example, instead of being paid $12,000,000 a CEO might pay themselves $2,000,000 in cash and award themselves $10,000,000 in stock. The fig leaf in that case is that it aligns his incentives with those of shareholders. There's totally not a principal-agent problem here, honest!
Selling all $10,000,000 of shares kinda reveals that fig leaf for what it is: giving himself the shares was never about aligning his incentives with shareholders - he just wanted the cash.
If shareholders' interests were represented competently and in good faith, you'd expect a very different incentive structure.
I'm curious, what is the very different compensation structure you'd propose?
That right there is the money quote for me that invalids my "pieces of flair" metaphor. You're right, the very best thing one might say about flipping the shares for cash is it's a bit crass; at best.
Also, I don't think the stock is a "fig leaf" -- it actually is in the shareholder's interests that CEOs hold a lot of stock. I can't think of any other explanation why the compensation of (non-founder) CEOs is so high. I suspect that if a CEO were to refuse to accept stock it would make shareholders uncomfortable. The stock is what incentivizes the CEO to act in the interest of shareholders when those are contrary to the interests of employees or customers.
My understanding is that the board is just other executives and CxO from peer companies. Think Eric Schmidt on the Apple Board or the disgraced Citi CEO John Thank on Uber's board. Neither of them represent our desire to minimize executive pay.
it actually is in the shareholder's
interests that CEOs hold a lot of stock
Really? Have you tried?
As a thought experiment, imagine (just hypothetically, of course) that companies were mostly run by grasping plutocrats, and members of the same group of greedy plutocrats sat on the boards of their friends' companies, and set their compensation.
And the low tax burden. The capital gains tax rate on those shares are 20% while if it was income, it would be taxed at 39.6% fed + whatever the state/city taxes are.
> If shareholders' interests were represented competently and in good faith, you'd expect a very different incentive structure.
The execs interests align with short term shareholders. Not the long term shareholders. It essentially fosters a pump-and-dump environment.
Also, it doesn't just affect KASLR. KASLR isn't even the concern here. Based on the info that is available/has been pieced together, it appears to be a bug, at the hardware desing level, in Intel CPUs speculative execution capabilities.
This bug allows a user level process or even a website to read any memory on the pc, including memory of another vm on the same box.
Bitcoin wallets, passwords, keys, all up for grabs by anon.
Can't be fixed by intel so all os providers have to implement fixes in os which slow down pc by approx 30%.
So you gaming pc or aws instances just cost more
This is a major one. On a dedicated box, as long as ssh and your http server are secure, you can run a compromised kernel. In practice, of course, it mostly means that there's an extra layer of exploit necessary before attackers are in. Everybody should insist on that, always.
Performance is another one (to put things bluntly: a 2-year-old atom with 4G straight on hardware, on 99% performance, beats a Quad Xeon with 96 Gigs of ram where you're 1 out of 100 VMs. And even that undersells it. In practice on that quad xeon it will regularly take 1s to jump into your code for a web request. Not generating a response, just the time before it actually processes your packet. If you're I/O bound (ie. every single website), the lowly dedicated Atom will beat the big bad Xeon).
And lastly, included network capacity is the third one. The cheapest dedicated on hetzner comes with $3000 worth of network (Google cloud prices, Amazon's are more expensive, and yes it's FUP bandwidth, so presumably you can use like $500 of it without problems if you're paying $10, not the full $3k)
Different investors have different risk appetites.
If in your mind, the CEO sells one share of the company's stock and all of the investors should sell that stock, I think it would be a fantastic time to buy into the stock.
And while the technical issue discussed elsewhere may play a role in people's minds, keep in mind that if it's only the CEO dumping stock he might be cashing out ahead of a #metoo
Worst part of that was the management sucked up to me when an SVP was copied on the email, and low-key ignored me when she wasn't.
This political cesspool cannot compete effectively against driven companies like NVidia. Intel seems to be the new Blackberry.
I imagine Apple's lawyers will be sharpening their knives, considering how deeply they're in with Intel. This is going to cost Intel dearly... and will surely affect the share price, regardless of the actual threat it poses.