Miscellaneous And Off Topic Subjects

[Da Geezer]

He speaks the truth. People who have not seen it directly cannot fathom how much damage Wall Street and, especially Black Rock, have done to Corporate America and ultimately the American consumer. There's literally no excuse for gasoline to not be $2/gallon right now. And that's only a small part of it. Corporate governance boards kowtow to Wall Street leftists and this shows up in many ways.

And Larry Fink's power comes from being able to vote the shares that he "holds" for others. These fund holders and pension funds should have to solicit proxy votes from the actual owners of the shares.

[Hannibal]

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[Hannibal]

And Larry Fink's power comes from being able to vote the shares that he "holds" for others. These fund holders and pension funds should have to solicit proxy votes from the actual owners of the shares.

This is true. It's essentially a loophole in capitalism. Shareholders are atomized enough for someone to control how a company is governed with a surprisingly small plurality. I don't know how you change that though.

[Mike]

A former Black Rock exec founded a new fund, Engine No.1, and got three climate activists elected to Exxon’s board of directors.

https://www.axios.com/2021/06/02/exxonmobil-board-seat-activist-investor

We live in interesting times.

[Hannibal]

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[Dr. Strangelove]

Fetterman (or whoever runs his account) has been having a lot of fun with Dr. Oz

[Hannibal]

Another great endorsement from the man who thought that bringing back John Bolton was a great idea.

[Da Geezer]

This is true. It's essentially a loophole in capitalism. Shareholders are atomized enough for someone to control how a company is governed with a surprisingly small plurality. I don't know how you change that though.

Simple. Make the Blackrock solicit how each "actual owner" of the shares wants to vote on each issue. This could be run just as the proxy service is with street-held stocks at a brokerage.

With most shares now in electronic form, if Blackrock's portfolio contains say 2% Apple, then notify all holders that they get to vote their proportionate share of the fund for the upcoming Apple Annual Meeting. This is just arithmetic but would have been burdensome in the past. It shouldn't be so much now.

A simpler way would be to not allow fiduciary holders of others' stock to vote that stock. This is a fixable problem.

And it is a huge problem. I remember when IRAs and later 401(k)s were introduced, one of the selling points is that the working class would actually have a stake in the stock market. From a R point of view, regular working folks would be able to affect the Annual Meetings of corporations. I'll still bet 75% of the actual owners of these ETFs are Republicans, but the ETFs always vote their shares for progressive policies.

[lineygoblue]

So. MBS told The Chairman that Saudi Arabia can't produce much more oil than they are already producing. Joe, with hat in hand, begged MBS to produce more oil, but MBS couldn't promise more. So now what? Of course the most sensible thing to do is turn loose some Texas and Oklahoma rednecks, and let them drill for the oil that the US already HAS... but that would make too much sense. The Dodderer-in-Chief would have to walk back his threat/promise to eliminate fossil fuels within 10 years, in order to do that. He doesn't dare break that promise to his leftist buddies.

Meanwhile, Joe Manchin seemed to be on board with a compromised reconciliation spending bill, but now he wants to wait until July's inflation numbers are released. This puts the latest version of 'build back better' in jeopardy.

And so it goes ...

[Da Geezer]

The bottleneck is US refining capacity. This is not as simple as SA opening the spigot. Saudis told Joe that.

[THE_WIZARD_]

You mean the "Pariah Nation" told Joe to GFY?

[Obi-Jon]

With most shares now in electronic form, if Blackrock's portfolio contains say 2% Apple, then notify all holders that they get to vote their proportionate share of the fund for the upcoming Apple Annual Meeting. This is just arithmetic but would have been burdensome in the past. It shouldn't be so much now.

A simpler way would be to not allow fiduciary holders of others' stock to vote that stock. This is a fixable problem.

Let's talk XOM, which I have held (as a retail investor) for 30+ years. 56.6% of common stock is held by institutions. As of July 1st, Vanguard holds 8.26%, Blackrock owns 4.7%, and State Street owns 6%. The top 6 mutual funds hold 10%. What's interesting is that the top 25 shareholders own less than 50% of the common stock. There are 4.226B shares outstanding at 1st quarter end. 43.4% of shares are owned by retail investors.

That's a lot of shareholders. If you think that mutual funds should get guidance for proxy voting from its participants, I can't disagree. If shareholders want to vote their stock, that would put a huge burden on the mutual fund companies, even if it were all electronic. Certainly fees would rise, particularly for index funds that hold more companies than the typical specialty funds. I also own mutual funds and I certainly don't want hundreds of proxy envelopes filling my mailbox.

Perhaps allowing fund owners the option of voting their shares in 3 companies, the rest voted as the institution sees fit. I'm certain there would be resistance from the institutions and I would guess that if you feel strongly enough about a company, you're going to hold stock on the side not just in some EFT or mutual.

Not allowing institutions a vote for shares they hold with fiduciary responsibilities is an interesting proposal. It would increase the power of the retail investor. You might see more volatility with that, but not necessarily in a bad way. I kinda like that idea.

You make the statement "I'll still bet 75% of the actual owners of these ETFs are Republicans, but the ETFs always vote their shares for progressive policies." I think I would take that bet. At XOM over the years, every single climate-related proposals has failed, but one succeeded at the last annual meeting. A preliminary tally showed 52% of shareholders voted for a proposal for Exxon to prepare a report showing how the International Energy Agency’s “Net Zero by 2050” scenario “would affect the assumptions, costs, estimates, and valuations underlying its financial statements.” XOM is hardly a 'progressive' company and it's voting blocks have consistently sided with the board and conservative policies. Solar or wind power companies would be a completely different story.

But I do like the empowerment of the individual shareholder as opposed to the continued outsized influence of institutions.

[Hannibal]

Let's talk XOM, which I have held (as a retail investor) for 30+ years. 56.6% of common stock is held by institutions. As of July 1st, Vanguard holds 8.26%, Blackrock owns 4.7%, and State Street owns 6%. The top 6 mutual funds hold 10%. What's interesting is that the top 25 shareholders own less than 50% of the common stock. There are 4.226B shares outstanding at 1st quarter end. 43.4% of shares are owned by retail investors.

That's a lot of shareholders. If you think that mutual funds should get guidance for proxy voting from its participants, I can't disagree. If shareholders want to vote their stock, that would put a huge burden on the mutual fund companies, even if it were all electronic. Certainly fees would rise, particularly for index funds that hold more companies than the typical specialty funds. I also own mutual funds and I certainly don't want hundreds of proxy envelopes filling my mailbox.

Perhaps allowing fund owners the option of voting their shares in 3 companies, the rest voted as the institution sees fit. I'm certain there would be resistance from the institutions and I would guess that if you feel strongly enough about a company, you're going to hold stock on the side not just in some EFT or mutual.

Not allowing institutions a vote for shares they hold with fiduciary responsibilities is an interesting proposal. It would increase the power of the retail investor. You might see more volatility with that, but not necessarily in a bad way. I kinda like that idea.

You make the statement "I'll still bet 75% of the actual owners of these ETFs are Republicans, but the ETFs always vote their shares for progressive policies." I think I would take that bet. At XOM over the years, every single climate-related proposals has failed, but one succeeded at the last annual meeting. A preliminary tally showed 52% of shareholders voted for a proposal for Exxon to prepare a report showing how the International Energy Agency’s “Net Zero by 2050” scenario “would affect the assumptions, costs, estimates, and valuations underlying its financial statements.” XOM is hardly a 'progressive' company and it's voting blocks have consistently sided with the board and conservative policies. Solar or wind power companies would be a completely different story.

But I do like the empowerment of the individual shareholder as opposed to the continued outsized influence of institutions.

I don’t know how you address the problem. As I said above, it’s a loophole in Capitalism. You can flush literal trillions of other people’s money down the toilet by abusing your plurality ownership position in a company. Net Zero pledges are wildly unrealistic and economically suicidal for a company like Exxon. But they do it anyways because half of the country thinks that Harry Potter is real.

[Jeff Buchanan]

Greetings from Manheim Germany. Half way through a Rhine river cruise from Amsterdam to Basal Switzerland. On Ukraine: no one here in Europe gives a shit. They might as the winter months arrive, it gets cold and energy is rationed. July? No. On COVID and Ba5: What is Ba5? There is a surprising lack of interest in it despite a continued stream of news that case numbers are increasing. Added to this is the general view that there are 7X more new cases than are being reported due to decreased testing. Shruggs.

Reporting from European news sources on the war in Ukraine is muted. I read that in Eastern Europe, Russian propaganda predominates with the Kremlin's apparatus for that paying Eastern European journalists $E2000 per month to write pieces favorable towards Russia. The central theme is that inflation, energy and food problems are caused by the west. Meanwhile, on the ground, nothing much changes on a day to day basis. IOW, its become a war in the information space for hearts and minds. The fighting, death and destruction are background noise. That the Russians are experts in controlling the narrative within that space, suggests Putin has a better chance of outlasting his pariah status than the west has in getting Russia to withdraw forces from Ukraine.

There is a chance that instability within shakey EU member governments brought about by an immigration, food and energy crisis inside those coutries could ignite a NATO military response at some level. TBH, that's where I think we are headed. There is little chance that Putin will withdraw his forces or give up territorial gains his army has achieved without NATO introducing military leverage itself. Obviously, there are two sides to the question of does NATO or doesn't it? One can argue that the cost of a potential for armageddon is too high a price to pay to force Putin out of Ukraine. Then there is the argument that allowing Putin to get his way in Ukraine guarantees he won't stop there. IMO, choosing to let Ukraine sink will significantly alter the rules based order, the sanctity of lawful borders and how nations with nuclear weapons act and interact.

This isn't an easy circumstance to deal with. There aren't simple choices only fairly obvious outcomes regardless of which path is chosen by the west. Well, I'll just enjoy the Rhine and the scenery blissfully isolated, for now, at least, from the realities of the world.

[Da Geezer]

Let's talk XOM,

Not allowing institutions a vote for shares they hold with fiduciary responsibilities is an interesting proposal. It would increase the power of the retail investor. You might see more volatility with that, but not necessarily in a bad way. I kinda like that idea.

You make the statement "I'll still bet 75% of the actual owners of these ETFs are Republicans, but the ETFs always vote their shares for progressive policies." I think I would take that bet. At XOM over the years, every single climate-related proposals has failed, but one succeeded at the last annual meeting. A preliminary tally showed 52% of shareholders voted for a proposal for Exxon to prepare a report showing how the International Energy Agency’s “Net Zero by 2050” scenario “would affect the assumptions, costs, estimates, and valuations underlying its financial statements.” XOM is hardly a 'progressive' company and it's voting blocks have consistently sided with the board and conservative policies. Solar or wind power companies would be a completely different story.

But I do like the empowerment of the individual shareholder as opposed to the continued outsized influence of institutions.

That's a good point about the influence of individual investors. It would certainly atomize the voting power of "shareholders, " which is always a good thing. I know I'd take proxy notices more seriously if I knew my vote actually could matter.

I do think, though, that taking XOM as a "typical" stock is misleading. Exxon shareholders SHOULD vote against Net Zero if they have any sense. This is an O+G company and voting NO on a proposal to destroy itself seems to me to be an easy call.

I will also note that almost all small businesses contribute to some form of 401(k). Small business owners are overwhelmingly Republicans. Democrats are public sector unions that have a pension plan or welfare recipients who don't need a plan. Rs are easily 75% of all 401(k)s.