Comment by s1artibartfast
2 years ago
I'm absolutely okay with the market destroying companies. It's literally one of the points of having a market to begin with. That sometimes also includes profitable companies.
I think the parent post is a fundamental misunderstanding of what markets are intended to do. If you want a static world that doesn't and can't change, then of course something like a command economy is preferable
I have no problem with unprofitable, severly mismanaged companies going out of business. I do have a problem when a company is liquidated to give an exit to shareholders when it is still profitable, as described in the article.
Honestly curious why? It seems a perfectly legitimate and even successful end to a company.
It seems to me that some people simply don't like change for sentimental reasons. There is no shortage of restaurants, and most frankly seem better.
If a company provides some utility while still making a profit, wouldn't it be morally better to let it be?
Killing the company immediately hurts its employees, its customers and reduces the income available to the collectivity through taxation. It even also hurts its stakeholders in the long term, who could have earned a steady dividend for many years to come.
I don't care much about Red Lobster and other chain restaurants, as I'm not even american. I simply believe we should coerce markets into optimizing for utility instead of short-term profit, which is their natural behavior.
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