NASA freezes Starliner missions

But the shareholders have been taken care of, right? Is the sacred shareholder OKAY?

Never mind that a famed company has been dismantled to pump the stock for a few years (and how long it took is a testament to its former excellence).

https://www.amazon.com/Flying-Blind-Tragedy-Fall-Boeing/dp/0...

What do shareholders have to do with it? Why are they so different from shareholders of Microsoft, Apple, Google, Facebook...? Do you really think they are happy now? No-damn-body would trade enormous future profits from one of the biggest opportunities of the future for some measly one-time millions today, in today's dollars. Space industry is going to produce many trillionaires.

This is the company which famously asked its engineers to put the shareholders at top of mind when making all of their decisions.

So what? That doesn't mean anything. The shareholders didn't say this, the management of the company did.

The shareholders are supposed to fire management when they are being stupid.

It's not that easy with such a big company. Look at Tesla and Musk. A management-aligned board can put a stop to many things the shareholders would like to do.

Any member of management, at any company, whose focus is more on their next-quarter or end-of-year payout (which seems to be most of them), will cheerfully trade enormous future profits for other people for a short-term profit for themselves.

Since the shareholders elect the board, I guess there might be a lesson for democracy in here too.

I think the problem is that the shareholders do not care about long-term profits either. They keep the management because the management prioritizes the shareholders and not the company or its customers.

We live in the stupid times. After watching others get rich off of Bitcoin, GameStop, and companies with fantastical valuations, everyone wants it to go the Moon ASAP.

And moved its headquarters 2,000 miles away to not be close to those annoying "engineers".

Thinking about shareholders in one broad stroke isn't useful.

There are shareholders who care explicitly about long-term (at least 20~30+ years) profits. These are investors who are investing for retirement. The problem here is most of them hold index funds or have the money managed by a third-party, so they are indirect shareholders who may or may not have voting rights themselves and may not care to vote in the first place. Bogleheading is explicitly about not giving a damn, after all.

The shareholders who hold stocks directly may or may not care about long-term profits. Investors holding for retirement do, though whether they would vote is anyone's guess. Traders don't care who or what the stock is, all they care about is whether they turn a profit in the next second. Investors holding for income today (read: dividends) care about short-term profits, though again whether they vote is anyone's guess. Shareholders who hold for biased reasons ("I love <company>!") will probably vote, but whether they care about profits at all is anyone's guess.

Anecdata: I hold Boeing stock (BA) through SWPPX which is an S&P 500 index mutual fund. Most of my interest is returns in about 20 to 30 years' time when I reach retirement age. I do not have voting rights as far as I am aware, and frankly I can't be arsed to care about voting.

That's my whole point. It's the management/possibly board, not the shareholders.

Its not that shareholders dont care, its that ownership isnt concentrated enough in a shareholder that both cares and is competent. I wrote my undergrad econometrics paper on this, it was actually pretty interesting. You inevitably end up with board capture and short term focus unless there is an elon or group of elons with enough shareholder votes to threaten management because uninvolved shareholders tend to listen to the managent and management wants to capture the board so they can vote themselves higher comp which relies on short term performance for the payout, which is much larger for the ceo than longterm returns on existing comp holdings. It has likey gotten much worse since passive blackrock et al etfs gained such large market share because they vote the shares in ways that benefits them which is only loosely correlated with beneffitting the ultimate share owner.

Sadly I expect the vast majority of shareholders would individually trade the future health and profits of the company for their own immediate benefit as well, were they in a position to make the same choice. You're right that since they collectively don't benefit from such short-sighted focus, they wouldn't make the same choice.

It's outside my bailiwick and I'm not quite sure how it happened, but it seems to me that over the course of a few decades (70s to 00s?) we went from a model of corporate management where the various mechanisms of "cripple the company for the short-term benefit of upper management (plus a few well connected others)" were neither sophisticated nor, well, thinkable, or at least not acceptable, to one where both the ability and the practice of doing so are near-ubiquitous.

We have a serious problem with corporate governance in this country. To be clear, it should NOT BE POSSIBLE to hollow out and destroy a company in this way and be rewarded for it by wall street. We keep blaming the bad actors, but the truth is, the regulators are at fault: It should be impossible to profit in this way. Changes to corporate governance rules would leave this still possible for private companies, but public companies would be judged differently and to a higher standard. Anyone here a public policy wonk who can explain how to change this?

> Anyone here a public policy wonk who can explain how to change this?

Stop considering the bad actors legal persons that can buy off the regulators

Yeah. You start by not electing a political party who hates government in general and regulators in particular.

Their opponents aren't always great shakes but it's no surprise that government functions badly when it's so often under the control of people whose existence is devoted to making it work badly. Maybe they could make a case for making it work better, but for decades they've said over and over that the only thing they want is to drown it in a bathtub.

I apologize for being political but surely people can see a connection between regulatory failure and management by an explicit hatred of all regulators.

Not precisely a policy wonk but I live surrounded by them.

Retail is very insignificant holder of this kind of stock. Less than 10-30% total in most cases of S&P stocks. It's mostly the pension funds, and big investors.

If the aerospace industry doesn’t have enough regulation for you I’m puzzled to think of one that does.

If we're talking institutional investors, logic suggests most of their votes would favour intermediate-term policies overall since their various interests encompass the whole breadth of short-, mid-, and long-term.

You fix this by letting Boeing fail. They keep going because our government keeps bailing them out. We deem them too important to fail so we keep holding their corpse up Weekend at Bernies style and hope the voodoo music doesn't cut out.

Fix the regulatory regime but also streamline it so other companies can begin to compete. We'll be without a domestic Airliner manufacturer for a bit but I don't think you fix this without eating that pain for a while.

It's funny to say that, when propping up Boeing is a bipartisan thing. They're both willing to move Heaven and Earth to give taxpayer money to Boeing, regardless of performance.

Boeing is failing because the government let it "self-regulate". This is directly related to the MAX tragedies. The assumption that a company will do the worst possible thing as a "citizen" should always be the starting point.

Air travel did not become one of the safest ways of transport out of the pure, intrinsic will of the industry to be better. it took decades of beating them into doing what's right.

Why don't we still have video recordings of cockpits for the Black Box? It would dramatically help in solving accidents, but the industry has been fighting this tooth and nail. "It's expensive!". "Safety" never comes up - that's the government's job.

Boeing is failing because it's a private company with no market consequences for doing badly and no domestic competition. Those are not caused by self-regulation they are caused by bad economic policy. Regulation is a part of the story but the rot at Boeing started long before the self-regulation did. Their quality and ability to compete at a profit has been dropping for longer than the regulatory issues.