Government to blame for C&W stranglehold

By Chris Halsall with contributions from Douglas Skeete

IN any jurisdiction, companies operate ultimately under the legislation created by a central authority, i.e. the Government. Therefore, the argument can easily be made that this authority must seek to devise, and more importantly enforce, legislation preventing companies from inhibiting the development of liberalization and fair competition.

Publicly traded companies (those listed on one or more stock markets) tend to act particularly aggressively, as they are dependent upon ever greater profits in order to raise their share price. Their executives’ remuneration packages are invariably tied to this, and often current (and ex-) employees hold a number of shares as well.

The stock market is a harsh mistress. Therefore a public company’s primary concern is about “making the numbers” for the next quarter — everything else is secondary. Stock prices have even been known to fall when a Company does manage to make their numbers, but do not “exceed analysis’ expectations”.

There’s nothing wrong with this, of course. To the contrary — it is raw capitalism at its purest; the most effective form of wealth creation ever devised by humans. But it must be appreciated and understood: capitalism is heartless, and companies feed upon their markets.

Read more…

Understanding Cable and Wireless in Barbados

By Chris Halsall, with contribution by Douglas Skeete

IT is reasonable to observe that before one can control something, one must understand it.

Cable and Wireless (C&W) is, arguably, simple to understand. It is an example of the organism known as the Company. Dogs have a tendency to bark. Barracuda have a tendency to bite. Companies have a tendency to work to maximize their financial returns using every means at their disposal.

This metaphor is not used in jest, but instead as a serious model. Companies exist in ecosystems like any other organism, and will behave in predictable ways towards the furtherance of their own self interests. They are what are known as “autonomous agents”, or “Actors”, within a system. It is worth noting that, legally, a Company is a Person.

Publicly traded companies (those listed on one or more stock markets) tend to act particularly aggressively, as they are dependent upon ever greater profits in order to raise their share price. Their executives’ renumeration packages are invariably tied to this, and often current (and ex-) employees hold a number of shares as well.

The stock market is a harsh mistress. Therefore a public company’s primary concern is about “making the numbers” for the next quarter — everything else is secondary. Stock prices have even been known to fall when a Company does manage to make their numbers, but do not “exceed analysis’s expectations”.

Read more…