Quote:
Originally Posted by henry quirk
Why did 'profit' become a dirty word?
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It never was. However its purpose has been subverted by what is taught in business schools where concepts also justify mafia style corruption.
Profits are a reward - not a purpose. For the same reason a gold metal in the Olympics is a reward - but not the purpose of that race.
If a company is not making a profit, then its products suck - do not advance mankind. Bankruptcy exists to destroy companies so corrupt as to not innovate.
If a company is making a profit, that does not mean its products are good. That only reports that a company *may* be making good products. Furthermore, good products only appear as a profit four to ten years after the fact. Another concept subverted by business schools that teach today's profits come from work done this year. Also called short term thinking or concepts that enrich top management at the expense of all other employees.
Shareholders expect a return on their investment. So responsible investors invest in something where an ROI is four to ten years after the fact. Because responsible and productive companies worry today about the product. And then reap a reward four to ten years later.
Profit is an indicator and a reward. But only if the reward is earned (ie by innovation) and not by scamming other (ie stock brokers).