FYI: Is Wall Street’s obsession with short-term results hindering corporate performance?
It seems obvious to many that it is, including market veterans Warren Buffett and Jamie Dimon, who earlier this month penned an op-ed piece in the Wall Street Journal urging companies to resist Wall Street’s demand for quarterly earnings guidance. They argued that “companies frequently hold back on technology spending, hiring, and research and development to meet quarterly earnings forecasts.”
And though only with great trepidation do I even raise questions about the arguments made by either of these two giants of the investment and corporate worlds, I am not convinced that eliminating a short-term focus will significantly improve firms’ longer-term performance.
Regards,
Ted
https://www.marketwatch.com/story/how-wall-streets-short-term-focus-can-bring-you-long-term-stock-gains-2018-06-20/print
