Activist Investor Quotes

It seems that the uglier the stock, the better the return, even when the valuations are comparable.

So I’m just proposing that we level the playing field and make those woke shareholders, like BlackRock or Al Gore’s Generation Investment Management, bear the same liability as any ordinary social activist when they engage in ordinary social activism through the companies that they invest in. Limited shareholder liability was never meant to protect well-heeled woke investors from the consequences of their actions during PR stunts at woke parades.

This book assumes that you are interested in being part of world-changing human capital that will help solve problems big and small. Maybe you are a teacher or a communicator, an activist or a doctor, a lawyer or an investor, or some new force for positive change. I have seen people like you alter the lives of schoolchildren and street children, refugees, the formerly incarcerated; of people living in forgotten communities and in places ravaged by war, poverty, or toxic industries.

Equity financing, on the other hand, is unappealing to cooperators because it may mean relinquishing control to outside investors, which is a distinctly capitalist practice. Investors are not likely to buy non-voting shares; they will probably require representation on the board of directors because otherwise their money could potentially be expropriated. “For example, if the directors of the firm were workers, they might embezzle equity funds, refrain from paying dividends in order to raise wages, or dissipate resources on projects of dubious value.”105 In any case, the very idea of even partial outside ownership is contrary to the cooperative ethos. A general reason for traditional institutions’ reluctance to lend to cooperatives, and indeed for the rarity of cooperatives whether related to the difficulty of securing capital or not, is simply that a society’s history, culture, and ideologies might be hostile to the “co-op” idea. Needless to say, this is the case in most industrialized countries, especially the United States. The very notion of a workers’ cooperative might be viscerally unappealing and mysterious to bank officials, as it is to people of many walks of life. Stereotypes about inefficiency, unprofitability, inexperience, incompetence, and anti-capitalism might dispose officials to reject out of hand appeals for financial assistance from co-ops. Similarly, such cultural preconceptions may be an element in the widespread reluctance on the part of working people to try to start a cooperative. They simply have a “visceral aversion” to, and unfamiliarity with, the idea—which is also surely a function of the rarity of co-ops itself. Their rarity reinforces itself, in that it fosters a general ignorance of co-ops and the perception that they’re risky endeavors. Additionally, insofar as an anti-democratic passivity, a civic fragmentedness, a half-conscious sense of collective disempowerment, and a diffuse interpersonal alienation saturate society, this militates against initiating cooperative projects. It is simply taken for granted among many people that such things cannot be done. And they are assumed to require sophisticated entrepreneurial instincts. In most places, the cooperative idea is not even in the public consciousness; it has barely been heard of. Business propaganda has done its job well.106 But propaganda can be fought with propaganda. In fact, this is one of the most important things that activists can do, this elevation of cooperativism into the public consciousness. The more that people hear about it, know about it, learn of its successes and potentials, the more they’ll be open to it rather than instinctively thinking it’s “foreign,” “socialist,” “idealistic,” or “hippyish.” If successful cooperatives advertise their business form, that in itself performs a useful service for the movement. It cannot be overemphasized that the most important thing is to create a climate in which it is considered normal to try to form a co-op, in which that is seen as a perfectly legitimate and predictable option for a group of intelligent and capable unemployed workers. Lenders themselves will become less skeptical of the business form as it seeps into the culture’s consciousness.

Labor and employment firm Fisher & Phillips LLP opened a Seattle office by poaching partner Davis Bae from labor and employment competitor Jackson Lewis PC. Mr. Bea, an immigration specialist, will lead the office, which also includes new partners Nick Beermann and Catharine Morisset and one other lawyer. Fisher & Phillips has 31 offices around the country. Sara Randazzo LAW Cadwalader Hires New Partner as It Looks to Represent Activist Investors By Liz Hoffman and David Benoit | 698 words One of America’s oldest corporate law firms is diving into the business of representing activist investors, betting that these agitators are going mainstream—and offer a lucrative business opportunity for advisers. Cadwalader, Wickersham & Taft LLP has hired a new partner, Richard Brand, whose biggest clients include William Ackman’s Pershing Square Capital Management LP, among other activist investors. Mr. Brand, 35 years old, advised Pershing Square on its campaign at Allergan Inc. last year and a board coup at Canadian Pacific Railway Ltd. in 2012. He has also defended companies against activists and has worked on mergers-and-acquisitions deals. His hiring, from Kirkland & Ellis LLP, is a notable step by a major law firm to commit to representing activists, and to do so while still aiming to retain corporate clients. Founded in 1792, Cadwalader for decades has catered to big companies and banks, but going forward will also seek out work from hedge funds including Pershing Square and Sachem Head Capital Management LP, a Pershing Square spinout and another client of Mr. Brand’s. To date, few major law firms or Wall Street banks have tried to represent both corporations and activist investors, who generally take positions in companies and push for changes to drive up share prices. Most big law firms instead cater exclusively to companies, worried that lining up with activists will offend or scare off executives or create conflicts that could jeopardize future assignments. Some are dabbling in both camps. Paul, Weiss, Rifkind, Wharton & Garrison LLP, for example, represented Trian Fund Management LP in its recent proxy fight at DuPont Co. and also is steering Time Warner Cable Inc.’s pending sale to Charter Communications Inc. Willkie Farr & Gallagher LLP and Gibson, Dunn & Crutcher LLP have done work for activist firm Third Point LLC. But most firms are more monogamous. Those on one end, most vocally Wachtell, Lipton, Rosen & Katz, defend management, while a small band including Schulte Roth & Zabel LLP and Olshan Frome Wolosky LLP primarily represent activists. In embracing activist work, Cadwalader thinks it can serve both groups better, said Christopher Cox, chairman of the firm’s corporate group. “Traditional M&A and activism are becoming increasingly intertwined,” Mr. Cox said in an interview. “To be able to bring that perspective to the boardroom is a huge advantage. And when a threat does emerge, who’s better to defend a company than someone who’s seen it from the other side?” Mr. Cox said Cadwalader has been thinking about branching out into activism since late last year. The firm is also working with an activist fund launched earlier this year by Cadwalader’s former head of M&A, Jim Woolery, that hopes to take a friendlier stance toward companies. Mr. Cox also said he believes activism can be lucrative, pooh-poohing another reason some big law firms eschew such assignments—namely, that they don’t pay as well as, say, a large merger deal. “There is real money in activism today,” said Robert Jackson, a former lawyer at Wachtell and the U.S. Treasury Department who now teaches at Columbia University and who also notes that advising activists can generate regulatory work. “Law firms are businesses, and taking the stance that you’ll never, ever, ever represent an activist is a financial luxury that only a few firms have.” To be sure, the handful of law firms that work for both sides say they do so

The research seems to offer a contradictory view. Though they appear intensely unappealing—perhaps because they appear so intensely unappealing—deeply undervalued companies offer very attractive returns. Often found in calamity, they have tanking market prices, receding earnings, and the equity looks like poison.

The research is clear that value stocks—defined as a low price in relation to some fundamental measure like earnings, book value, or cash flow—outperform glamour stocks, which have a high price in relation to those fundamental measures.

It was the German powerhouse Deutsche Bank AG, not my fictitious RhineBank, that financed the construction of the extermination camp at Auschwitz and the nearby factory that manufactured Zyklon B pellets. And it was Deutsche Bank that earned millions of Nazi reichsmarks through the Aryanization of Jewish-owned businesses. Deutsche Bank also incurred massive multibillion-dollar fines for helping rogue nations such as Iran and Syria evade US economic sanctions; for manipulating the London interbank lending rate; for selling toxic mortgage-backed securities to unwitting investors; and for laundering untold billions’ worth of tainted Russian assets through its so-called Russian Laundromat. In 2007 and 2008, Deutsche Bank extended an unsecured $1 billion line of credit to VTB Bank, a Kremlin-controlled lender that financed the Russian intelligence services and granted cover jobs to Russian intelligence officers operating abroad. Which meant that Germany’s biggest lender, knowingly or unknowingly, was a silent partner in Vladimir Putin’s war against the West and liberal democracy. Increasingly, that war is being waged by Putin’s wealthy cronies and by privately owned companies like the Wagner Group and the Internet Research Agency, the St. Petersburg troll factory that allegedly meddled in the 2016 US presidential election. The IRA was one of three Russian companies named in a sprawling indictment handed down by the Justice Department in February 2018 that detailed the scope and sophistication of the Russian interference. According to special counsel Robert S. Mueller III, the Russian cyber operatives stole the identities of American citizens, posed as political and religious activists on social media, and used divisive issues such as race and immigration to inflame an already divided electorate—all in support of their preferred candidate, the reality television star and real estate developer Donald Trump. Russian operatives even traveled to the United States to gather intelligence. They focused their efforts on key battleground states and, remarkably, covertly coordinated with members of the Trump campaign in August 2016 to organize rallies in Florida. The Russian interference also included a hack of the Democratic National Committee that resulted in a politically devastating leak of thousands of emails that threw the Democratic convention in Philadelphia into turmoil. In his final report, released in redacted form in April 2019, Robert Mueller said that Moscow’s efforts were part of a “sweeping and systematic” campaign to assist Donald Trump and weaken his Democratic rival, Hillary Clinton. Mueller was unable to establish a chargeable criminal conspiracy between the Trump campaign and the Russian government, though the report noted that key witnesses used encrypted communications, engaged in obstructive behavior, gave false or misleading testimony, or chose not to testify at all. Perhaps most damning was the special counsel’s conclusion that the Trump campaign “expected it would benefit electorally from the information stolen and released through Russian efforts.

For modern money to work—to have banks, and a stock market, and a central bank—there needs to be tension. Investors and bankers and activists and government officials all need to be arguing over who gets to do what, and when. Often today, the people making those arguments suggest the system is broken: The government is interfering too much or the bankers are getting away with murder. But those arguments themselves are, if not sufficient to make the system work, at least necessary. The push and pull among people with different interests—lenders and borrowers, investors and workers—is what keeps money stable. Economic historians have argued that the Bank of England and paper money took off in England when they did in large part because Parliament had just gained power relative to the king. People were more likely to lend money to the government because they thought Parliament would keep the king in line.

Another example, one that touches more people, is the nursing home industry. Numerous studies have shown that living at home, in a house or an apartment, is better psychologically, more fulfilling, and cheaper than living in nursing homes.14 Yet these institutions prosper when federal programs that foster living in the community are cut. There are also funding disincentives that the U.S. Congress, through Medicare and Medicaid, has created to ensure the profit bonanza of nursing homes. According to the activist disability journal Mouth (1995), there are 1.9 million people with disabilities living in nursing homes at an annual cost of $40,784, although it would cost only $9,692 a year to provide personal assistance services so the same people could live at home. Sixty-three percent of this cost is taxpayer funded. In 1992, 77,618 people with developmental disabilities (DD) lived in state-owned facilities at an average annual cost of $82,228, even though it would cost $27,649 for the most expensive support services to live at home. There are 150,257 people with mental illness living in tax-funded asylums at an average annual cost of $58,569. Another 19,553 disabled veterans also live in institutions, costing the Veterans Administration a whopping $75,641 per person.15 It is illogical that a government would want to pay more for less. It is illogical until one studies the amount of money spent by the nursing home lobby. Nursing homes are a growth industry that many wealthy people, including politicians, have wisely invested in. The scam is simple: get taxpayers to fund billions of dollars to these institutions which a few investors divide up. The idea that nursing homes are compassionate institutions or necessary resting places has lost much of its appeal recently, but the barrier to defunding them is built on a paternalism that eschews human dignity. As we have seen with public housing programs in the United States, the tendency is to warehouse (surplus) people in concentrated sites. This too has been the history with elderly people and people with disabilities in nursing homes. These institutions then can serve as a mechanism of social control and, at the same time, make some people wealthy.

new breed of activist investors emerged in the wake of the dot-com bust in the early 2000s, chasing the cashed-up failures of the information technology and communications boom.