Session 2 (CF MBAs): The End Game in Business

Рет қаралды 14,125

5 ай бұрын

In this session, we started on what the objective in running a business should be. While corporate finance states it to be maximizing firm value, it is often practiced as maximizing stock price. To make the world safe for stock price maximization, we do have to make key assumptions: that managers act in the best interests of stockholders, that lenders are fully protected, that information flows to rational investors and that there are no social costs. We started on why one of these assumptions, that stockholders have power over managers, fails and we will continue ripping the Utopian world apart next class.
Syllabus: pages.stern.nyu.edu/~adamodar...
Slides: pages.stern.nyu.edu/~adamodar...
Post class test 1: pages.stern.nyu.edu/~adamodar...
Post class test 1 solution: pages.stern.nyu.edu/~adamodar...
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Пікірлер: 14

@tevsepromwebmaster8541 5 ай бұрын

Professor, those guys wants that you do a case of Harvard like for to reflexion about valuetion of companies. Right now that is touching this theme of valuetion of company and his diferents methods.

@Nexus26688 2 ай бұрын

Thank You

@ragnar6919 29 күн бұрын

I noticed a quote by Sir that said, "The definition of insanity is doing the same thing over and over again." It gives me serious chills. 🥵 did he copied that dialog from vaas . can;t anything sir could be a far cry 3 fan .

@harshc17 4 ай бұрын

It would be interesting to know Professors' view on Apple vs Spotify/Fortnite saga from lens of maximising shareholder value over long term. Has Apple by effectively bypassing EU regulations decreased value of future cashflows by inviting stringent regulations and reduced support from App ecosystem (Vision Pro)?

@chetanrastogi4367 4 ай бұрын

would'nt the best way to make effective boards is to only have people there who own a large percetage of the stock? Exclude the passive holders like Blackrock and Vanguard?

@kristinn3367 3 ай бұрын

Board members are almost always required to hold stock in the company. Requiring them to hold a “large percentage” of the stock is not necessary, so long as they are incentivized to act in the best interest of the shareholders. Additionally, you have to consider the downsides. If the requirement is for them to hold a “large percentage” of the stock, then you have two options: concentrating power into the hands of a few very high NW individuals or institutional investors, or issuing large volume of shares to your selected board members, which would have a dilutive effect on the remaining shareholders.

@innerscorecard9433 3 ай бұрын

@@kristinn3367 look at the berkshire board. Heavy onwership. Incentivizes them to protect their wealth. Most board members in other companies hold miniscule amount of company stock compared to their NW or even board fees.