Return on
Equity
An
Economic Travesty in Three Way-To-Tear-Us-Aparts
by
C.
P. Klapper,
Abstract
Development, LLC
Prologue
It
sounds so reasonable and so benign
To
get from equity the greatest return
But
look with me behind this vague angelic mask
And
you will see the devil in the details
Apart Once
When
we take a trip in place or in money
When
do we say that we have returned
When
have we drawn the last benefit of our journey
When
do we say it was worth it and close our books
Our
answers question ourselves
Are
you just so much impatient flesh
Or
are you more, a soulful person
Are
you a passing moment or a monument for the ages
So
the flesh of decisions now
Reckon
only the current return
Rendered
with bright but fading paints
Obscuring
the future profit and loss
The
contestants knowing the judges
Trade
their somber sober oils
For
the brighter but riskier shades
The
prize today is tomorrow an empty canvas
Apart Twice
Equity
is the stable stone
On
which each company is built
But
it is also the value below the line
In
the Return on Equity equation
Who
cannot notice this easy way
To
get more return for the equity
By
reducing the equity itself
By
skimping on the foundation
Who
cares if the building comes crashing down
With
its unsupported weight
Return
on Equity has approved the plans
So
that must have been the goal
Equity
the much maligned and despised Overhead
Weep
outside at the damage wrought
By
relying on shaky outsourced deals
And
spurning the stability of their faithful service
Intermission
Return
on Equity allows only brief intermissions
Where
you might not think of the long-term costs
Of
its short-term take-I-mean-earnings
Or
where that money might be going
Apart Thrice
What
of that money in the vaunted return
We
figure the company has received the cash
That
it is now a swollen bundle
But
shouldn't it be handed over to the ones we have been serving
The
investors should receive our sacrifice
To
repay the moneyed trust they placed in us
We
may have been reckless and bet the store
But
it was, was it not, for their reward
What's
that you say Return on Equity
They
saw no dividends but the stock price is up
Because
the returns have been kept safely “retained”
Except
for the bonuses for the executives
So
the investor gets nothing unless he sells
The
return to the no longer investor
The
faithless are amply rewarded
The
faithful must wait until they are not
Epilogue
After
all of this brutal tearing apart
How
can we put our economy back together
I
suggest we bring this conclusion
By
joining in reverse order as we showed here torn apart
First
the investor faithful and true
Who
stayed with his company through thick and thin
Should
receive every day for shares owned when it began
A
set percentage of the average volume-adjusted traded price as his
dividend
Second
that each publicly traded company
Shall
report their equity at the open
And,
until the close, the price shall be no more
Or
less than by half that equity per every share
Third
that the stated and lauded goal
Of
every public company
Shall
be stability and consistency
Steady
in changing times
Then
the investor will favor and be rewarded by
The
surely growing company that finds its optimal size
While
speculation and wild surmise
They
will shun and let vain promises lie
Copyright ©
2009 by C. P. Klapper
