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  #1  
Old 07-17-2011, 06:35 AM
isaiahrobinson isaiahrobinson is offline
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Where do rich people keep huge amounts of money?

There was a story recently about someone finding a withdrawal receipt near an ATM in East Hampton which had a balance listed at just under $100,000,000. It was rumored to belong to a hedge fund manager called David Tepper but when asked by the New York Post he said, "I would never do something so irresponsible as to keep $100m in a savings account".

I know there's probably an infinite number of things you could invest $100m in, but I'm just wondering what the most basic, run-of-the-mill one is. If you won $100m on the lottery and you asked a specialist accountant for a list of options as to what to do with it in the short-term, what would the simple Option 1 be? He'd say, "well, it might not generate the best returns, but the most basic option is to keep it in...", what?

Treasuries?

Swiss bank account?

Something else?

Or is a complicated, balanced portfolio of investments the only sensible way to store that much money?
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  #2  
Old 07-17-2011, 07:01 AM
Fear Itself Fear Itself is online now
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Mutual funds.
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  #3  
Old 07-17-2011, 10:14 AM
doubled doubled is offline
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Most rich people don't actually have that much cash. Even super billionaires. Usually, they're a ceo and have a billion dollars worth of stock in the company, and for all intents that's as good as cash, since they can sell some of the stock (or take a loan against it) if they need to buy a house or whatever. But most billionaires don't actually have a billion dollars cash sitting around.
If you're diversifying outside of your company, you hire an asset manager (hedge fund, private equity, etc). They will usually invest your money in something semi-exotic that normal people can't invest in alone. Ie, investing in startup companies, or maybe a hedge fund will put it in derivatives.

You will definitely NOT keep 100 million in your bank for long. Partly cause it's not earning much interest, but mostly cause the government guarantees bank deposits up to 250,000 but not above. So if the bank went out of business, sucks to be you. (There are special types of bank accounts that get around this problem but they don't have ATMs)

That ATM deposit slip people found was probably temporary-- the guy was buying a new house or something so he sold some stock and had the money wired to his account so he could write a check. Odds are, that money will be spent within a week.
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  #4  
Old 07-17-2011, 11:23 AM
DJ Motorbike DJ Motorbike is offline
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They invest it. Create jobs.
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  #5  
Old 07-17-2011, 12:18 PM
AWB AWB is offline
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Originally Posted by isaiahrobinson View Post
Treasuries?

Swiss bank account?

Something else?

Or is a complicated, balanced portfolio of investments the only sensible way to store that much money?
Money bin, a al Scrooge McDuck?
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  #6  
Old 07-17-2011, 12:23 PM
Spoke Spoke is offline
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Originally Posted by DJ Motorbike View Post
They invest it. Create jobs.
If I put my $100 million in a mutual fund (presumably purchasing already-issued shares of stock in companies that are up and running), how, exactly, does that create jobs?

What if I use it to buy undeveloped real estate as a long-term investment?

Or buy T bills?

(Just testing your assumptions.)

Last edited by Spoke; 07-17-2011 at 12:25 PM..
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  #7  
Old 07-17-2011, 12:27 PM
arseNal arseNal is offline
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Apparently some people keep it in a Capital One checking account.

http://www.businessinsider.com/someo...account-2011-6
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  #8  
Old 07-17-2011, 12:29 PM
Dewey Finn Dewey Finn is offline
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Yes, that story was mentioned in the OP.
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Old 07-17-2011, 12:40 PM
GreasyJack GreasyJack is online now
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Originally Posted by arseNal View Post
Apparently some people keep it in a Capital One checking account.

http://www.businessinsider.com/someo...account-2011-6
It's probably not a Capitol One account, considering that the ATM charged him a fee. Perhaps it could be some sort of banking instrument that's more exotic than a run-of-the-mill savings account, but which still has ATM access?
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  #10  
Old 07-17-2011, 12:40 PM
Exapno Mapcase Exapno Mapcase is offline
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It would be nice if it were true that the hugely rich invest gobs of money to create jobs, but there is no actual evidence for this. Unless your definition of "invest" is so elastic to be meaningless.

There's no real default answer to the OP's question. Any economic adviser will give anyone with money of any size to put away the same answer. Diversify. Put some money into stocks, either directly or through mutual funds; some into bonds; some into commodities; some into real estate; and keep a small amount in cash for fun and impulse. All these run on different cycles, i.e. when some are rising others are falling. This keeps you from having huge losses when a cycle bottoms. Only those whose greed blinded them to this basic truth lost all their money by giving it to a Bernie Madoff.

What never happens, except in the very indirect way above, is that they use it to create jobs. A small number do provide money to start-up companies, true. However that's one of the riskiest ways of investing. Most start-ups fail, in which case all the money is lost. Venture capital is no more than a sophisticated form of Las Vegas. You do it only with money you feel completely free to lose or you're an idiot. That's why most start-ups find it so hard to get any money at all.

And there is no real reason to do anything similar with your $100,000,000. Businesses today are sitting on an estimated $2,000,000,000,000 (yes, trillion) in "cash" (i.e. money put into some form of the above to make a return) that they are not turning into jobs. They don't see a sizable return for investment in job creation. If the collected businesses of America don't, then no individual will.
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  #11  
Old 07-17-2011, 01:46 PM
Fubaya Fubaya is offline
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The available balance and balance are the same. The sucker doesn't even have overdraft protection!
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  #12  
Old 07-17-2011, 01:51 PM
Dewey Finn Dewey Finn is offline
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Originally Posted by GreasyJack View Post
It's probably not a Capitol One account, considering that the ATM charged him a fee. Perhaps it could be some sort of banking instrument that's more exotic than a run-of-the-mill savings account, but which still has ATM access?
Right. The account is at another bank, so Capitol One charged him a fee as a non-account holder.
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  #13  
Old 07-17-2011, 02:44 PM
yabob yabob is offline
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Some brokerage accounts allow checkwriting / ATM withdrawal privileges. It makes sense for somebody to have a substantial quantity being carried as cash in a brokerage account for a short interval while they are moving it between investments, or if they active traders who have pulled out of the market and are sitting on the sidelines for a while. But $100 million is more than "substantial".
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Old 07-17-2011, 05:44 PM
aruvqan aruvqan is offline
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Back a few years ago you used to be able to buy bogus atm slips to keep in your wallet so if you wanted to give a girl your number you pull out a 'random' piece of paper from your wallet and scribble your number on it ... http://www.prankplace.com/product.as...s&p=13777&c=50
still can apparently.
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  #15  
Old 07-17-2011, 07:02 PM
arseNal arseNal is offline
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Originally Posted by Dewey Finn View Post
Yes, that story was mentioned in the OP.
I read all the replies and did a text search for capital but I guess I failed to read the OP fully.
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  #16  
Old 07-17-2011, 07:15 PM
Musicat Musicat is offline
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Under the mattress?
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  #17  
Old 07-17-2011, 07:41 PM
Little Nemo Little Nemo is offline
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Originally Posted by DJ Motorbike View Post
They invest it. Create jobs.
Or they invest in a company and cut its expenses by laying off half the employees.
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  #18  
Old 07-17-2011, 07:47 PM
TriPolar TriPolar is online now
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In your 401K account.
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  #19  
Old 07-17-2011, 08:51 PM
NAF1138 NAF1138 is online now
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I can't answer for all people, but until relatively recently I worked in business management which is sort of like full service accounting for the super wealthy. My firm specialized in the entertainment industry, so we didn't have the super super wealthy, but it wasn't chump change I think our richest client had a net worth of somewhere around 80 million. I can tell you what we advised our clients to do.

First we always tried to keep a percentage liquid. What percentage depended on the client, but it was enough to cover their regular monthly expenses plus another 10 thousand or so as a buffer. This was all kept in interest earning checking accounts, or high yield money market accounts. The money was shuffled around daily to make sure it was where it was needed.

Second our clients were all heavily invested in Mutual funds, IRA's, T-Bills, and other securities. What they were specifically invested in would change depending on what our brokers and investment advisers recommended at any given time. But diversity was key. Never more than a couple of million in any particular investment and it was all staggered so that not everything would mature at the same time, but something was always maturing every few months.

Third, and this wasn't us it was just where another large chunk of money went, property. Most of our clients owned multiple homes, or were investors in malls or office buildings, owned apartment complexes that sort of thing.

Add in jewelry, cars, art, other toys and that's where all the money usually was. Like I said, diversity was key as was making sure to get the largest yield with the lowest risk.

Last edited by NAF1138; 07-17-2011 at 08:52 PM..
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  #20  
Old 07-17-2011, 09:12 PM
Princhester Princhester is offline
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You will definitely NOT keep 100 million in your bank for long. Partly cause it's not earning much interest, but mostly cause the government guarantees bank deposits up to 250,000 but not above. So if the bank went out of business, sucks to be you.
I'm not sure this answer makes sense. You are saying the biggest reason to avoid banks is because of the risk of them failing but are banks a worse risk than most other investments that you might use instead?

I doubt this is correct. I think the main reason is just that banks have a low rate of return.
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  #21  
Old 07-17-2011, 09:23 PM
NAF1138 NAF1138 is online now
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I'm not sure this answer makes sense. You are saying the biggest reason to avoid banks is because of the risk of them failing but are banks a worse risk than most other investments that you might use instead?

I doubt this is correct. I think the main reason is just that banks have a low rate of return.
Yeah, you only keep what you need easy access to in the bank, and that is because even the best interest earning account won't earn as much as almost anything else, not because of FDIC insurance. There are just smarter placed to keep your money, particularly if you are talking about large sums. But it wasn't unusual for us to have a client with 300k or 400k in one of the bank savings accounts if they were the type of person who had a lot of cash going in and out of their accounts regularly.

Last edited by NAF1138; 07-17-2011 at 09:25 PM..
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  #22  
Old 07-17-2011, 09:36 PM
mac_bolan00 mac_bolan00 is offline
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my guess is an ATM-checking account where he deposits his check payments and transactions but also his main disbursements. average balance would be in the 5- to 6-figures.
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  #23  
Old 08-25-2012, 11:26 AM
ChrisJones ChrisJones is offline
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fda insured bank accounts

The FDIC covers up to a certain amount. Used to be the first $100k. More now? Probably. However I once inquired with a bank manager about this exact subject. I had a customer who lost her husband in the 9/11 attacks. She had previously been taken advantage of by a contractor. I was replacing him. While cashing one of her checks one day I asked the manager about the risks of having more than what the FDIC insures. She told me that in such a case the remainder of the account would be insured privately by a company such as Lloyds of London etc. It makes perfect sense to me. Lloyds IS an insurance company, and insuring large savings accounts sounds like it would be right up their alley. So I think the response of this financial manager was a bunch of bull. 100 million bucks would be perfectly safe in a savings account, providing that it's a reputable bank.
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  #24  
Old 08-25-2012, 11:29 AM
ChrisJones ChrisJones is offline
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FDIC insured bank accounts

The FDIC covers up to a certain amount. Used to be the first $100k. More now? Probably. However I once inquired with a bank manager about this exact subject. I had a customer who lost her husband in the 9/11 attacks. She had previously been taken advantage of by a contractor. I was replacing him. While cashing one of her checks one day I asked the manager about the risks of having more than what the FDIC insures. She told me that in such a case the remainder of the account would be insured privately by a company such as Lloyds of London etc. It makes perfect sense to me. Lloyds IS an insurance company, and insuring large savings accounts sounds like it would be right up their alley. So I think the response of this financial manager was a bunch of bull. 100 million bucks would be perfectly safe in a savings account, providing that it's a reputable bank.
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  #25  
Old 08-25-2012, 12:14 PM
Bullitt Bullitt is offline
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Originally Posted by Exapno Mapcase View Post
It would be nice if it were true that the hugely rich invest gobs of money to create jobs, but there is no actual evidence for this. Unless your definition of "invest" is so elastic to be meaningless.
Aren't stocks and mutual funds investments in companies that employ workers? How are these not creating (or maintaining) jobs?
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  #26  
Old 08-25-2012, 12:28 PM
TimeWinder TimeWinder is offline
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Aren't stocks and mutual funds investments in companies that employ workers? How are these not creating (or maintaining) jobs?
Assuming I'm not being wooshed, you know it doesn't take more brokers to invest $1000 than it does to invest $1, right? More money in the system doesn't mean more hiring.

Quote:
Originally Posted by Exapno Mapcase
It would be nice if it were true that the hugely rich invest gobs of money to create jobs, but there is no actual evidence for this.
That actually doesn't go far enough: there's plenty of evidence for the converse. Notably, that in the last twelve years of huge tax breaks for the rich, personal fortunes have increased considerably. Yet we're somehow not swimming in jobs, in fact, quite the opposite.
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Old 08-25-2012, 12:37 PM
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Originally Posted by echo7tango View Post
Aren't stocks and mutual funds investments in companies that employ workers? How are these not creating (or maintaining) jobs?
I assume Mr. Mapcase was referring to investments in the "secondary" market: most shares already existed before you purchase them, so your purchase isn't "new" investment.

But in that case Mr. Mapcase's answer is incomplete since your purchase frees up money for the stock seller. Eventually, as this money changes hands it will find its way to something other than the secondary stock market, e.g. an IPO or family business. Of course the money could end up being used to buy cocaine or entertainment at a casino or whorehouse! Still, even then it's helping to create jobs.
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  #28  
Old 08-25-2012, 12:38 PM
Fear Itself Fear Itself is online now
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Originally Posted by echo7tango View Post
Aren't stocks and mutual funds investments in companies that employ workers? How are these not creating (or maintaining) jobs?
Unless you are buying stock in an initial public offering (IPO), none of your investment goes to the company you are investing in. You are buying stock from another stockholder in the hope that the stock will go up; he is betting the stock will go down. They only way the company you are investing in gets capital out of the deal is if the price goes up due to demand from you and other people buying stock, and they sell more company-owned stock to raise cash. But your investment doesn't directly create jobs.

Last edited by Fear Itself; 08-25-2012 at 12:39 PM..
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  #29  
Old 08-25-2012, 12:49 PM
njtt njtt is online now
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Originally Posted by echo7tango View Post
Aren't stocks and mutual funds investments in companies that employ workers? How are these not creating (or maintaining) jobs?
You are getting the causal order backwards. Increased demand for goods and services causes companies to have a need to hire more workers, and in such circumstances they seek investors in order to finance this expansion, and it becomes worthwhile to invest in them. Investing in companies that cannot sell any more of their products or services does not create any jobs, and is probably going to be a very poor investment to boot. So no, investment does not create jobs, demand creates both jobs and opportunities for investment.
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  #30  
Old 08-25-2012, 12:52 PM
Exapno Mapcase Exapno Mapcase is offline
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Originally Posted by septimus View Post
I assume Mr. Mapcase was referring to investments in the "secondary" market: most shares already existed before you purchase them, so your purchase isn't "new" investment.

But in that case Mr. Mapcase's answer is incomplete since your purchase frees up money for the stock seller. Eventually, as this money changes hands it will find its way to something other than the secondary stock market, e.g. an IPO or family business. Of course the money could end up being used to buy cocaine or entertainment at a casino or whorehouse! Still, even then it's helping to create jobs.
Thanks for making clear why I used the dismissive qualifer "Unless your definition of "invest" is so elastic to be meaningless."

It's true that every exchange of money is part of the larger economy. But it's obviously possible for the number of jobs in the total economy to shrink even when money changes hands. So this activity does not necessary create jobs - it's the same as trickle-down theory, which we know to be wrong. And I can't see any way to call it an investment in the normal sense. Your spending your payback would be an investment in job creation by this standard and that's meaningless.

Jobs are created by the hugely rich. And by the slightly rich. And by the middle-class. But keeping your money in the standard locations - stocks, bonds, real estate, precious metals, collectibles, etc. - is not what's doing it.
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  #31  
Old 08-25-2012, 12:54 PM
Bullitt Bullitt is offline
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You are getting the causal order backwards. Increased demand for goods and services causes companies to have a need to hire more workers, and in such circumstances they seek investors in order to finance this expansion, and it becomes worthwhile to invest in them. Investing in companies that cannot sell any more of their products or services does not create any jobs, and is probably going to be a very poor investment to boot. So no, investment does not create jobs, demand creates both jobs and opportunities for investment.
You are unnecessarily limiting the possible scenarios. Investing in companies that can sell more products does create more jobs. Companies have to be able to support the increased need.
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Old 08-25-2012, 01:10 PM
septimus septimus is offline
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Thanks for making clear why I used the dismissive qualifer "Unless your definition of "invest" is so elastic to be meaningless."
You missed the point. I wrote "Mr. Mapcase's answer is incomplete" to be polite. "Completely wrong" would have been almost as accurate.

Viewing the stock market as a black box, the money (banknotes etc.) in on a given day will equal the money out. If Mr. A buys $10,000 of stock, there is some Mr. B who has $10,000 of cash he didn't have before. ($10,000 may not be enough to have significant job creation potential, but that's beside the point.)

The extra $10,000 will be invested or spent. It may very well be spent on an IPO or family business and that's investment that would not exist unless the stock market were propped up by Mr. A and other investors like him.

True, the money is likely, especially in today's environment, to end up instead as wasted financial paper in a bank vault, or as a cocaine purchase, but the essential point remains: Stock purchases generally have the effect of net investments whether placed directly into IPO's or into the secondary market.
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  #33  
Old 08-25-2012, 01:12 PM
Exapno Mapcase Exapno Mapcase is offline
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You are unnecessarily limiting the possible scenarios. Investing in companies that can sell more products does create more jobs. Companies have to be able to support the increased need.
You can invest in companies, but only at very limited times, usually when new shares of stock are being issued. Otherwise, sales of stock do not flow back to the company. Since non issue sales are probably 99.999999% of all stock purchases, investing in stocks is a very different procedure from investing in a company.
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Old 08-25-2012, 10:51 PM
Bullitt Bullitt is offline
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You can invest in companies, but only at very limited times, usually when new shares of stock are being issued. Otherwise, sales of stock do not flow back to the company. Since non issue sales are probably 99.999999% of all stock purchases, investing in stocks is a very different procedure from investing in a company.
Where do sales of stock flow to, then? The company sees none of it?
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  #35  
Old 08-25-2012, 11:15 PM
Fear Itself Fear Itself is online now
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Where do sales of stock flow to, then? The company sees none of it?
Other stockholders who want to sell stock. The company sees none of it, unless they sell stock they own, which is rare compared to the volume of stock sold by stockholders.
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  #36  
Old 08-26-2012, 02:28 AM
Leo Bloom Leo Bloom is offline
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Opening that account the guy better be given two toasters.
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Old 08-26-2012, 10:40 AM
Bullitt Bullitt is offline
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Other stockholders who want to sell stock. The company sees none of it, unless they sell stock they own, which is rare compared to the volume of stock sold by stockholders.
So when the company sells stock, they get money and they can then hire more people.

Last edited by Bullitt; 08-26-2012 at 10:41 AM..
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Old 08-26-2012, 11:00 AM
Fear Itself Fear Itself is online now
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So when the company sells stock, they get money and they can then hire more people.
Yes. This rarely happens.
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  #39  
Old 08-26-2012, 11:15 AM
FuzzyOgre FuzzyOgre is offline
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So when the company sells stock, they get money and they can then hire more people.
And eventually run out of majority shares in their company, thus ceding control to whoever now does. You can see they might not always want to do that.

Last edited by FuzzyOgre; 08-26-2012 at 11:16 AM..
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Old 08-26-2012, 11:28 AM
Exapno Mapcase Exapno Mapcase is offline
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Yes. This rarely happens.
And it is balanced off by stock repurchases by companies.
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  #41  
Old 08-26-2012, 11:41 AM
Dewey Finn Dewey Finn is offline
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Quote:
Originally Posted by echo7tango View Post
So when the company sells stock, they get money and they can then hire more people.
And eventually run out of majority shares in their company, thus ceding control to whoever now does. You can see they might not always want to do that.
I'm no financial professional, but I don't think that's the way it works. I don't believe that these unissued shares have any voting rights, so they don't affect who has majority control.
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Old 08-26-2012, 11:47 AM
Exapno Mapcase Exapno Mapcase is offline
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I'm no financial professional, but I don't think that's the way it works. I don't believe that these unissued shares have any voting rights, so they don't affect who has majority control.
What kind of shares are issued and what voting power they have vary from case to case so there is no possible way to generalize about them.

Last edited by Exapno Mapcase; 08-26-2012 at 11:47 AM..
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  #43  
Old 08-26-2012, 11:53 AM
Dewey Finn Dewey Finn is offline
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True, but echo7tango referred to the company selling stock. My understanding is that the only way to do so is to sell unissued but previously authorized shares, sell previously sold treasury shares that have been repurchased by the company or to issue new shares in the company. Again, not a financial professional, but I can't imagine that any such shares have voting rights. How could they? Who would vote them?
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Old 08-26-2012, 12:01 PM
Exapno Mapcase Exapno Mapcase is offline
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True, but echo7tango referred to the company selling stock. My understanding is that the only way to do so is to sell unissued but previously authorized shares, sell previously sold treasury shares that have been repurchased by the company or to issue new shares in the company. Again, not a financial professional, but I can't imagine that any such shares have voting rights. How could they? Who would vote them?
I must be missing something because this happens all the time. There are many ways that new stock can come on the market. Yes, issuing new stock does dilute the percentage of holding previous buyers have in the company, but that's an everyday procedure. They can always buy some of the new stock if they want to keep holdings equal. Whether the shares are preferred or non-preferred or voting or non-voting or have unequal voting strengths or any of the other possible maneuvers (all of which happen regularly) makes no difference.

And I don't understand why "unissued but previously authorized shares" would have voting rights any different from the previously issued shares.
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  #45  
Old 08-26-2012, 12:05 PM
Dewey Finn Dewey Finn is offline
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I was replying to FuzzyOgre, who said,
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Originally Posted by FuzzyOgre View Post
Quote:
Originally Posted by echo7tango View Post
So when the company sells stock, they get money and they can then hire more people.
And eventually run out of majority shares in their company, thus ceding control to whoever now does. You can see they might not always want to do that.
If I understand him correctly, he's suggesting that when a company sells new shares to the public, it might lose control of the company. That seems incorrect to me.

Last edited by Dewey Finn; 08-26-2012 at 12:05 PM..
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  #46  
Old 08-26-2012, 01:14 PM
Exapno Mapcase Exapno Mapcase is offline
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Originally Posted by Dewey Finn View Post
I was replying to FuzzyOgre, who said,
If I understand him correctly, he's suggesting that when a company sells new shares to the public, it might lose control of the company. That seems incorrect to me.
A company never owns itself. Its stockholders own it. In most large companies nobody holds a majority of all stock or even of the voting stock. The major stockholders put directors on the Board to ensure that decisions go their way and use those shareholders (and the usual indifference of minor stockholders) to create coalitions to win any votes of the whole.

It is often the case that some outsider starts buying up shares. It doesn't take much. Anything who amasses 5% of the shares can normally win a seat on the Board. If they can get control of 30% they can put in a slate of directors and probably can force the old management out.* In the extreme case of Apple that would be a ridiculous $187 billion. Nobody owns Apple. It's all about control of voting. If a small percent of stock swings that can have a profound effect. It's all indirect, though. A company can't lose control of it; it never had control of itself to begin with. That's true even if the stock is not publicly sold.


*What if current management refuses? Then a stockholders suit can be filed or a vote of all shares can be forced. It's possible to exclude large stockholders but it's rare and risky.
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  #47  
Old 08-26-2012, 01:19 PM
Fuzzy Dunlop Fuzzy Dunlop is offline
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Quote:
Originally Posted by Dewey Finn View Post
I was replying to FuzzyOgre, who said,
If I understand him correctly, he's suggesting that when a company sells new shares to the public, it might lose control of the company. That seems incorrect to me.
The existing shares are diluted by the issuance of new shares so unless the current owners buy the new issue (investing more cash in the company they already invested in), then they'll own proportionally smaller shares.

A simple example would be Mr Zuckerberg and Facebook. Even after their IPO he still owns enough shares to control the company. If Facebook ever does a future IPO, there'll be more shares out there and he'll own a smaller portion of the company. He might lose his controlling interest.

I don't really understand why FuzzyOgre is presenting that like it's a dangerous or negative thing but it's not incorrect.
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  #48  
Old 08-26-2012, 07:09 PM
FuzzyOgre FuzzyOgre is offline
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Quote:
Originally Posted by Fuzzy Dunlop View Post
The existing shares are diluted by the issuance of new shares so unless the current owners buy the new issue (investing more cash in the company they already invested in), then they'll own proportionally smaller shares.

A simple example would be Mr Zuckerberg and Facebook. Even after their IPO he still owns enough shares to control the company. If Facebook ever does a future IPO, there'll be more shares out there and he'll own a smaller portion of the company. He might lose his controlling interest.

I don't really understand why FuzzyOgre is presenting that like it's a dangerous or negative thing but it's not incorrect.
Yeah, I didnt mean to suggest it was all that negative. You said what I tried to say, but far better. Thanks fellow Fuzzy.

Last edited by FuzzyOgre; 08-26-2012 at 07:09 PM..
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  #49  
Old 08-26-2012, 07:25 PM
Dewey Finn Dewey Finn is offline
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Some companies structure things so that there are two types of stock; one with more voting rights than the other. The founders keep control of the company by owning more of the higher-voting class. I think this is how Google is structured, so that Larry Page, Sergey Brin and Eric Schmidt control the company.
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  #50  
Old 08-26-2012, 07:47 PM
Exapno Mapcase Exapno Mapcase is offline
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Quote:
Originally Posted by Dewey Finn View Post
Some companies structure things so that there are two types of stock; one with more voting rights than the other.
I wonder where you might have heard that?
Quote:
Originally Posted by Exapno Mapcase View Post
Whether the shares are preferred or non-preferred or voting or non-voting or have unequal voting strengths or any of the other possible maneuvers (all of which happen regularly) makes no difference.
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