JOE THE PLUMBER HAS NO IDEA HOW BIG THE WORLD IS
As the oil majors report records, consider what the opportunity cost to having done nothing while oil spiked.
The companies paid out or returned huge amounts of cash to their shareholders, only to see that return of capital "go up in smoke" as the market's fall trimmed over 25% of that, if it were re-invested in Exxon, and maybe 40% or more if it went into a broader basket of stocks. All that payout, "compounded negatively".
How much? $124 billion over the years 2005-2008 (through June - add another $10 billion for this quarter). This is all cash that the company said it didn't need, that it was returning to shareholders.
For perspective, that would be 2.2 million mortgage foreclosures that could have been addressed directly, steps that might have clipped the spiral of events that have led to today's panic mode.
Even if the public shared half with shareholders, that would still be a super-large sum, right?
Friday, October 31, 2008
The Windfall Profits Tax - A Massive Lost Opportunity
