Why do financial managers get better results in a downward economic envirionment?
356230
Some do, some don't. Just like some do, and some don't when the market goes up. There are managers that say they 'specialize' in contrarian investing - that is going against the flow. But from my experience, it is hit and miss. This time they win, this time they have lost. When they win, everybody points it out - when they lose, they try really hard to blame someone/something else and/or try to not get noticed.\n\nBut it is true, some managers do better than other managers at  various times - it's hard to find one manager that can do well all of the time.\n\nGood luck
831746
Tie the managers' financial rewards to the company's performance.  Stock options are one way to do that.  If the company does well, the stock received by the manager is worth more.  If the managers run the company into the ground, the stocks are worthless.
374731
Oh! That a good question. If anything to go by, small businesses want to take the short-term opportunities. They can do anything to make money first, and they will restructure their organizations then (I mean reengineering management). I tried to answer the question according to the framwork issued by McKinsey called 7S's: Strategy, Style, Structure, System, Shared Value, Skills, and Staff. They will confront with much challenges when their businesses go to bigger. So they must find out the way to retain.
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The company could increase the performance of the company so that investors value the share above $1 (eg. disposing of poorly performing divisions/assets, cost cutting measures etc.)\n\nAlternatively, a consolidation of capital in the form of a reverse split can be done too, although this is just a stop gap for a poorly performing company.\n\nHere's an interesting article about reverse splits:\nhttp://moneycentral.msn.com/content/P32972.asp
480984
At the time, it was in response to the Savings and Loan implosion.  Several small Savings & Loans had invested reserves in poor quality securities and became insolvent when their investments failed.  FASB responded by making companies show more of their activities in security investments on the income statement.
596492
Well, if the strategic management is effective, the corporate performance is improved and profits increase. 'Strategic Management' is making sure an organisation moves in the right direction. It's a very general question, though.
581075
From the choices, it looks like A.  Decrease.\n\nWith lower margins (see monopoly versus perfect competition), the profits slim down over time and there's less room for individual growth even with the total size of the industry increasing.
267830
When they make a profit, they have a positive effect on national GDP.  When they operate in the red or go bust, they have a negative effect on national GDP.
768138
No.  An effective manager will provide positive and negative feedback.  However, the negative feedback should be constructive, not just "You suck at x, y, and z."  Employees need to know what is good and what is bad regarding their work.  If they never heard the negative side, they would never know what needs improving.
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I'm not sure you read the story right.  Credit card companies aren't really excited to increase the minimum payment amounts.  They are adjusting their minimum payments in response to a change in government guidelines.\n\nFrom what I've read and heard, a number of companies are afraid that any increase in minimum payment is more likely to result in increased default rates, and thus to greater loss of money, not lower.\n\nAs for the idea that increasing minimum payments would increase income for them, while it might increase cash flow in the near term, I would think it would decrease profit in the long term since people would pay off their debts earlier (and thus pay less interest in the end).
341291
In some ways, yes, beause it shows the speed at which your market is turning in cash rather than disbursing it in real time, at the very least, daily.  Your accounting profit is a rather static measure of your performance for the accounting period covered.
188483
The issuing companies maybe paying down a greater portion of their debt, which makes them less probable in defaulting.
227117
Most managers aren't able to run an office efficiently in their employees eyes. Every employee thinks they could run the office better than their manager and more often than not it seems that the manager isnt pulling the same weight is their employees although the manager has different tasks to handle.
1184447
Management never produces better performance. Managers are usually the biggest part of any problem in a corporate setting.
662076
Hi Dave,\n\nI saved an article a while back that addressed this same question. Basically it has to do with the required reserves that banks must have because they take your deposits (and due to the nature of the business).  The article is below but is missing the related tables that it references.  Email me at bimmayute1@yahoo.com and I'll send you the article (word doc).\n\nNicholas\nnsmconsulting.net\n\n\n\nBy Vitaliy Katsenelson, CFA\n02/10/2006 \nInvesting in the stock market is a never-ending learning experience. That's what makes it so appealing and intellectually stimulating. And I inadvertently had one of those live-and-learn experiences just the other day. \nIn my piece on Lloyds TSB(NYSE: LYG), I wrote that banks usually trade at lower price-to-earnings ratios to the market because they are considered riskier investments as a result of their high use of debt. That line caught the eye of Foolish financial editor Joey Khattab, who asked writers Stephen Simpson and Nate Parmelee whether they agreed with my logic. Both disagreed. They argued that larger banks have lower P/Es generally because they are perceived to have a slower or more limited growth potential. \nAt first, I thought there might be a conspiracy of Fools at work against me! So I asked several investment professionals for their opinion. And to my amazement, they all agreed with the Fools. \nSo I looked at some larger banks to see whether they had been slow growers in the past, and I couldn't reach that conclusion. Many of these banks, in fact, had achieved very respectable earnings growth and paid above-average dividends in the process. I then looked at expectations for future earnings growth, and they appeared not to be below average, either. With the exception of Fifth Third(Nasdaq: FITB), which Wall Street once loved to love and now loves to hate, the rest of the pack was trading at a substantial discount to the market and still are. \nInstitution 10-Year Avg. EPS Growth Rate Median 10-Year P/E Current Dividend Proj. EPS Growth \nCitigroup18.6% 15.3 3.8% 10% \nU.S.Bancorp(NYSE: USB)\n17.5% 14.3 4.5% 10% \nFifth Third15.8% 22.7 4.1% 10% \nWells Fargo(NYSE: WFC)\n12.8% 15.6 3.4% 11% \nBank of America(NYSE: BAC)\n9.3% 13.4 4.5% 9% \nAmsouth8.7% 12.8 3.7% 8% \nRegions Financial(NYSE: RF)\n4.6% 13.7 4.0% 8% \nWachovia(1.6%) 13.6 3.9% 10% \nJPMorgan Chase(NYSE: JPM)\n(2.7%) 15.0 3.6% 10% \n\nThe answer must be more complex than just the growth rates. I believe the answer to banks' lower P/Es lies in the following four factors. \n1. Cyclicality \nThe banking business is closely tied to the health of the economy. As the economy expands, demand for loans increases and bad debt declines -- a combination that improves banks' profitability. In a contracting economy, of course, the reverse takes place. \nBecause investors pay up for predictability, they rarely pay a full market multiple for the volatility that comes with cyclical companies. Cyclical heavy-industrial companies like Caterpillar and Ingersoll Rand, for example, usually trade below the market P/E just as a many banks do. \n2. Financial leverage \nWe have not had a bank crisis in the U.S. for a while, so most investors have forgotten just how risky banks can be. But as Warren Buffett has said, by the time you find out a bank has a problem, it will be too late. The equity at most banks stands at meager 6%-10% of total assets, so when a bank does make a mistake, its high leverage amplifies the problem. \n3. Interest rate volatility \nBanks are subject to the risks that come with changing interest rates. They prosper when the difference between long-term and short-term rates -- in other words, the interest rate spread -- is high. However, when that spread narrows, it becomes increasingly difficult for banks to make any money. Many banks have addressed the problem by boosting their fee businesses. For example, fees account for a full 46% of U.S. Bancorp's income, thereby making the com
103087
sounds like something can drive your finances to higher level..... it's like a medium to get you to somewhere.... real estate can be a financial driver when you can receive rents.  that is a form of residual income.
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Depending on the securities, the firm might have to cash them in at an unexpected time to pay for business expenses.  With that, it might not be the optimal time to get out of the securities.\n\nAlso, the investments might be poor and lose money for the firm.