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Comment by pdntspa | Hacker News Reader

Funny how 'give more of it to employees' and 'lower prices' aren't really in the vocabulary

I'm in Business School and took a class in Finance. In a lecture the professor presented what to do if a company has too much cash, the options where:

1. Invest in positive NPV projects 2. Store some for a rainy day 3/4. Pay divdends or stock buybacks

Only after did I think "You know, what about lowering prices or paying employees, these options are soley about shareholders". But... yes, managers are taught to think about increasing shareholder wealth above all.

> But... yes, managers are taught to think about increasing shareholder wealth above all.

Saving money for a rainy day helps employees, too. Investing in new projects does indirectly because staffing up those projects increases the demand for labor, so the price of labor goes up.

The good old trickle down.

Or 'pay taxes'

This is one of those things where I can go either way on. I'm not mad about the taxes I pay but we're I, or anyone, given the option to reinvest that money into MyFamilyConsulting LLC or give it away via my own self-directed charitable endeavors I would do it without even thinking about it.

In their defense, most Apple employees are paid in stocks and share buybacks likely increases their compensation more than directly increasing their compensation.

Are rank-and-file (not engineering) employees of Apple compensated in enough stock that buybacks are really worth that much? I highly doubt it. And even then, until those shares are sold they are subject to the whims of the market. Paper millionaire status doesn't mean shit if you can barely afford to pay rent.

A bird in hand is worth two in the bush...

SWEs at Apple are not "barely able to afford rent"

I'm not talking about SWEs. Who cares about them. I am talking about Apple Store employees, or the dudes behind the 'genius' bar, or Jill from marketing

Considering many shareholders are not employees, how could giving money (/increasing share price through stock buybacks) for shareholders affect employees compensation more than directly giving it to the employees?

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