*** The Official CUCKposting thread ***

[spoonitnow]

I think it's a simple as that money that is paid in dividens, that profit, would be better spent on investment, whether that be R&D or lower prices. I fail to see how these companies have earned the profit. Just by taking risk? What risk? Their profit is guaranteed. The only risk they're taking relates to their competence, and even that isn't a deal breaker.

The bold is mistaken.

The underline is just, like, your opinion man. Additionally, they've earned the profit by taking on the risk. That's how an investment works.

[OngBonga]

The bold is mistaken.

Well if their profit is as hard earned as your regular man's business, I might soften my tone somewhat. But I fail to see how it isn't guaranteed, or at least close to. Ok a nuclear meltdown or an oil slick is going to eat into their profits somewhat, but they lack the competition to pay the ultimate price for their failure. See BP for example.

[spoonitnow]

Well if their profit is as hard earned as your regular man's business, I might soften my tone somewhat. But I fail to see how it isn't guaranteed, or at least close to. Ok a nuclear meltdown or an oil slick is going to eat into their profits somewhat, but they lack the competition to pay the ultimate price for their failure. See BP for example.

The higher the risk of investment, the higher the dividends if you want to keep investors on. It's that simple.

This has nothing to do with profit being "hard earned" or a "regular man's business." It's the same principle for all businesses and investments.

Simple example: It's the same reason why loans have interest, and the higher the risk on the loan, the higher the interest.

[OngBonga]

The higher the risk of investment,

But how risky is their investment? If they're buying a government contract and will have no serious competition, the risk is very low indeed.

[spoonitnow]

But how risky is their investment? If they're buying a government contract and will have no serious competition, the risk is very low indeed.

Then they get small dividends relative to the risk. That's not the same thing as no dividends.

Note, however, that your assessment of the risk is only based on a lack of competition. A lack of competition is not the only risk.

[BananaStand]

But how risky is their investment? If they're buying a government contract and will have no serious competition, the risk is very low indeed.

This is what government oversight analyzes. As I outlined in the example of Vermont's electric company, there is a government body that evaluates the "appropriateness" of the firm's return on invested capital based on many factors, including their relative risk.

[wufwugy]

See BP for example.

What do you think about BP?