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I don't understand why companies don't just let there stock price fall. This makes no material difference to the operating of the company, right?



Rising stock price is helpful for retaining high value employees that are compensated with stock


I guess. You could just pay them more though.


> I guess. You could just pay them more though.

This is a good idea. Stop the stock game and just pay a set base salary = to comp + stock.

But we can’t do that because that would take all the fun out of seeing part of your potential income fluctuate with the whims and buffoonery of Wall Street.


Shareholders own companies and a rising stock price benefits shareholders who elect the board members that run said company, a falling stock price isn't in anyone's interest who are invested in the company.

It does help with M&A, raising capital, employee stock options + bonuses.

It's rare, but sometimes you'll hear company Investors saying that their stock price is too high, like Zoom's CEO [1].

[1] https://www.bloomberg.com/news/articles/2019-04-18/zoom-vide...


Good point. This is why we need to reduce the amount of control shareholders have over company boards!


You think owners should have no control over what they own?




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