What the word "business" really means today
"For almost the entire history of America, the route to riches was to build a business that sold real products or services to real customers. Depending on the era, it might have been a railroad, steel, retail, energy, real estate or technology empire. By the end of the 20th century, technology, media and real estate were the best ways to get rich. . . As the 21st century dawned, a new actor had snuck onto the stage.
leveraged-buyout (LBO) and hedge-fund managers who charged their capital providers 2 percent of the assets they managed plus 20 percent of the profits made. Call it the “2&20” formula. This formula became one of the greatest generators of new wealth in America. And it was the source of Romney’s fortune, estimated at about $250 million.
How do they do it? How do the 2&20 titans get to the top of the list in greater numbers than anybody else? By treating labor and capital as adversaries. For hedge funds in particular, the question is not: How can I serve capital best? It is: How much of the investment returns can I extract for myself before the investor earns his returns?
How do they do it? How do the 2&20 titans get to the top of the list in greater numbers than anybody else? By treating labor and capital as adversaries. For hedge funds in particular, the question is not: How can I serve capital best? It is: How much of the investment returns can I extract for myself before the investor earns his returns?"
http://www.washingtonpost.com/opinions/mitt-romney-a-symbol-of-the-talent-economy/2012/10/19/09df8966-17ae-11e2-9855-71f2b202721b_story_1.html
= new reply since forum marked as read
