Showing results for: “price gouging”
*Why* Are Directors Awarding Spring-Loaded Options?
Of late, my colleagues on the internet have been blogging about stock options – notably discussing backdating and “spring-loading.� My colleagues have done a fine job with debating whether or not the latter is illegal (and/or reprehensible) and discussing the status of play with the former. My contribution to the discussion is to ask “what ... *Why* Are Directors Awarding Spring-Loaded Options?
Anabtawi on Spring-loaded Options
Over at Professor Bainbridge’s place, Iman Anabtawi has some thoughts on the granting of “spring-loaded” options, an option granted at a market price that does not incorporate some favorable non-public information, and insider trading laws. The practice is analytically similar to granting a discount option (one with an exercise price below the market price) and ... Anabtawi on Spring-loaded Options
The Unconvincing Antitrust Case Against Wal-Mart
I recently picked up a copy of the July Harper’s Magazine to read an essay by Barry C. Lynn entitled, “Breaking the Chain: The Antitrust Case Against Wal-Mart.” If you can’t tell from the title, the basic point is that antitrust authorities should break up Wal-Mart and put an end to the immense havoc that ... The Unconvincing Antitrust Case Against Wal-Mart
On rigged(?) markets, casinos and Steve Bainbridge
Greetings loyal fans (i.e., “hi mom”) (actually, I’ve made this gag before, and so I think it’s time to set the record straight:  My mom has almost certainly — nay, certainly — never, ever read this blog. I’m pretty sure she has no idea what a blog is at all. She may not even be ... On rigged(?) markets, casinos and Steve Bainbridge
Sirius/XM: An Antitrust Problem?
After scoffing for months at the suggestion that satellite radio firms Sirius and XM should merge, Sirius CEO Mel Karmazin admitted this week that it’s something he’d like to see happen but expressed doubts about the antitrust authorities permitting the deal to go through. See stories here and here. Karmazin is right that the proposed ... Sirius/XM: An Antitrust Problem?
Backdated options and incentives.
A letter to the editor in today’s W$J (see here) asserts the following regarding option backdating: [B]y backdating options at the lowest price of the past period, say, three months, a company is not providing any more incentives to CEOs to work harder on behalf of shareholders. If anything, since the options are already in ... Backdated options and incentives.
Salinger on Price Gouging
Economist Michael Salinger, Director of the Federal Trade Commission’s Bureau of Economics for the past year, comments on the recent FTC Report and price gouging in Sunday’s WSJ (HT: Greg Mankiw). I have blogged a bit about the FTC Report previously: once about its findings (that “market manipulation” did not explain post-Katrina price increases), once ... Salinger on Price Gouging
An Insider Trading Policy a Monkey Would Love
As Josh noted, Henry Manne recently published a WSJ op-ed arguing for liberalization of insider trading on efficiency grounds — chiefly, because such trading “aids capital allocation decisions and informs business executives through market-price feedback of the best predictions about the value of new plans.” (For a more complete statement of Henry’s argument, see here.) ... An Insider Trading Policy a Monkey Would Love
The origin of option backdating?
An article in yesterday’s NYT describes the genesis of option backdating at Micrel Inc., a silicon valley semiconductor company: Throughout the 1990’s, Silicon Valley companies were locked in an intense battle to recruit employees, and stock options were their primary tool. * * * So when new hires began complaining that the [Micrel’s] volatile share ... The origin of option backdating?
TOTM, Now with Extra Nuance!
In response to Thom’s post on the merits of federal subsidies for private efforts to develop alternative fuels, frequent and thoughtful commentor William Goodwin issues a critique of Thom’s post, and of TOTM more generally. I will leave the merits of Mr. Goodwin’s specific criticisms (do read them) to Thom, but this particular portion caught ... TOTM, Now with Extra Nuance!
Do Positive Externalities Always Justify Government Subsidies? Some Insights From the Austrians and Public Choice
The folks over at Lawyers, Gun$, and Money are chiding me for ignoring (or, as they say, never having heard of) positive externalities. A couple of days ago, I criticized a NYT editorial calling for the federal government to “throw its weight behind” private efforts to develop alternative fuels. My main point was that the ... Do Positive Externalities Always Justify Government Subsidies? Some Insights From the Austrians and Public Choice
Henry Manne on Behavioral Finance & Insider Trading
When Henry Manne writes about insider trading, as he does this week in the WSJ op-ed, one can be sure that it is worth reading. The op-ed, which is the first installment of a two part series, offers two central points: (1) the behavioral finance literature does not support the regulation of insider trading, but ... Henry Manne on Behavioral Finance & Insider Trading
