Last year my economic forecast for 2014 called for a rate of real economic growth of 4% for the U.S., much higher than the prevailing forecast at the time as well as the prevailing rate of economic growth that had existed in the years 2010-2013. Economic growth had only been sputtering along at between 1.8% Read More 2015 Economic Forecast
This article is an introduction to how companies can lay the foundation for long-term value creation. We will discuss three major steps they can take to achieve this goal. First, companies must develop a clear understanding of sustainable long-term value. Second, companies must have compensation plans that properly incentivize employees to create long-term value. Lastly, companies must attract investors Read More In Pursuit of Long-Term Sustainable Alpha
The objective of firm value maximization is at the heart of corporate financial theory. A company can create value through its operating, investment, and financing decisions. From the financing perspective, a firm can maximize its value by achieving the optimal mix of borrowed capital (debt) and equity; in effect, this optimal balance minimizes the firm’s Read More Financial Policy: What is the optimal capital structure and why does the debt level vary among industries?