Analysis: Silicon Valley insiders profited while companies flopped
The newspaper examined records of stock sales by executives, board members and venture capitalists at 40 companies that have become almost worthless since March 2000. It found that the insiders walked away with $3.41 billion from the sales while, by Sept. 30, their companies' total market value fell 99.8% to $229.5 million.
"This money was taken from investors who didn't have the same information as these insiders and lost their money," said Charles Elson, director of the Center for Corporate Governance at the University of Delaware.
"They sell the stock and then they restate the earnings," Minow said. "That brings it one step closer to being a Ponzi scheme."
http://www.usatoday.com/tech/techinvestor/2002-12-09-tech-insiders_x.htm
Americas investors and corporate Boards are squarely to blame for all of this.
Now days, there is nothing resembling "long-term thinking" or vision in most US companies. Everything is "quarter-driven" (e.g. "What have you done for me THIS quarter??"). There is constant pressure on costs to enhance companies' bottom lines, so corporate execs do whatever they feel they can do (or have to do) to cut costs.
Here's a big hint: What's the single largest cost to ANY employer??