The article “Overcoming Short-Termism” discuss some good ideas that could help increase the length of investment made by investors and companies. It seemed to attack the newly acceptable life style that millions of people have been living for years. Instant gratification has become the over whelming idea in every aspect of people’s lives all over the world. People want things now, instant entertainment, instant information, instant transportation, and now instant result of investments made. Are we too far adapt to this instant gratification to start moving in the opposite direction? Would companies be willing to give up short-term investments that give them cash now for a long-term investment that increase the length of the pay off? It would appear that investors and companies want to be able to make a large amount of money instantly with short-term investments and to compound the problem there are companies offering very tempting short-term investments because they need money right now. Would it be safe to say that there are very few alternatives to short-term investments?
Are regulations and incentives a good enough alternative to change an entire mind-set? Companies that have operated under this investment method will have to change their entire business model and business activities to adjust to the new long-term investment mentality. Like in most instances there will be companies that are willing to pay extra taxes to be able to still operate with short-term investments. Do investors really have an opportunity to make money over the long run with long-term investments or does that put them behind the competitive edge?
The problem with short-termism stems much farther than just people making short-term investments in an unpredictable market. It comes from a mentality that has been accepted by a majority of the population of the world. This mentality and business practice will take an extremely long time to reverse, and in the end will it be better for companies to be forced to make long-term investments?
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