Corporations - especially publicly traded ones - are not exactly known for their long-term planning. Quarterly reports on the other hand...

It's a prisoner's dilemma. Lacking government regulation, investment will always flow to the food companies willing to sacrifice the longterm health of consumers in exchange for higher revenue.

That is, food corporations that practice methods that increase consumption to unhealthy levels - high sodium, high sugar, low satiating and cheap to produce foods (high-carb, high-yield meat products due to growth hacks like bovine growth hormone).

The food companies that choose not to play along are either niche health food companies, or they will go bust by not being able to compete in a commodity market.

Sarah Palin (1) would have you believe we should have the "freedom" to eat what we want. However, for the vast majority of Americans that's a straight up pipedream. We are "free" to eat whatever is available, and baring government intervention what is available is subject to the forces described in my previous paragraph (ie garbage optimized to make us over-consume).

The obesity epidemic WILL NOT be resolved until heavy government regulation comes into play in the food industry. Pretending otherwise is no different than those who pretend abstinence education prevents pre-marital sex.

1. Obviously I'm just using her here as poster child for a certain political ideology.

> Sarah Palin would have you believe we should have the "freedom" to eat what we want. However, for the vast majority of Americans that's a straight up pipedream.

I don't know, in every town there is a grocery store that sells produce, raw meat, and other unprocessed foods. If your argument is that the shopper is so overwhelmed by advertising that he just can't help but choose poorly --- well, that's the dividing line between conservatism and liberalism.

Actually I believe that there is truth to both sides, but either side taken to the extreme leads to absurdity. Full faith in the individual, and full faith in government, are each flawed.

> no different than those who pretend abstinence education prevents pre-marital sex

May I suggest you look into that more?

>If your argument is that the shopper is so overwhelmed by advertising that he just can't help but choose poorly --- well, that's the dividing line between conservatism and liberalism.

You're free to believe that most humans are capable of making healthy eating choices by their own free will if you want (not trying to be catty, and I'm not sure that was the point you were communicating, just how I interpreted your comment), but the data overwhelmingly suggests otherwise.

https://upload.wikimedia.org/wikipedia/commons/thumb/8/82/US...

At a certain point I believe it is important to protect people from themselves. Being too proud to admit that "humans can be taken advantage of using certain hacks/tricks" makes society as a whole weaker.

>Actually I believe that there is truth to both sides, but either side taken to the extreme leads to absurdity. Full faith in the individual, and full faith in government, are each flawed.

You and I agree on this point 100%. Currently I believe the FDA has allowed too much leeway with the food industry. I'm not foolish enough to think that it couldn't easily swing too far in the other direction as well.

But long term returns almost always have a lower priority to short term returns in a company's balance sheets.

sigh... lemme tell ya what they taught us in finance theory class: rich investors are not stupider than average investors; in fact, if investing "for the long term" is the right thing to do, rich investors actually have the resources, wherewithal and the time to do it.

The problem is, as hard as it is to predict the future, it is harder to predict farther into the future; and, once you set up a pot of "long term" honey, people have a chance to reorganize their affairs to siphon off said honey and if your idea is to not pay attention to their short term results, you set yourself up for a big long term surprise. Publicly traded companies are mostly companies that have products, markets, customers, service, etc. Generally, when they are losing money compared to other companies, it does not scream "we're pouring money into R&D, great things are around the corner!"

This boils down to, statistically speaking, short term results are actually the best indicator of long term results. You'd be foolish (statistically) to overemphasize long term hypotheticals in the face of short term losses.

TL;DR that financial markets are too tilted in favor of "short term" results is largely a myth. if it were not a myth, wealth would shift from the majority people who supposedly pay attention to short term results and toward people who ignore short term results leading to the end of the myth.

edit (couple above and): I'm not saying that long term projects and ideas and thinking don't ever pay off; I'm saying that saying that they are undervalued and therefore represent an opportunity is a stretch and requires proof that you most likely will not find if you look because others have looked.

Did they teach you that a group of completely rational short-term thinkers can get stuck at a local maximum that's way below the optimum for people who are thinking ahead? Or that irrational behavior can emerge from groups of smart, rational individuals in competition?

Theory aside, here's a thing that doesn't fit into any short-term models I know: Bell Labs. Take a monopoly business with a ton of spare cash, and throw that cash into a well. Build a city full of comfortable middle-class researchers and their families with no need to produce anything of immediate value, and keep it going for decades. Watch them invent a million amazing things that change the world, and then, once they get splintered into a bunch of smaller, short-term focused groups, watch them fade into insignificance.

I'm not sure if you are disagreeing with me or agreeing and adding on.

If you are suggesting that rational behavior is emerging every time, or even much of the time, somebody says "Wall Street is too focused on the short term", I shake my head in sadness at the money you are planning to lose.

But isn't that shift in wealth actually happening? My understanding is that the richest investors are increasingly moving their capital from publicly-traded stocks to privately held companies (venture capital and private equity) exactly because they earn higher long-term returns. Those private companies don't have the same pressure to pay attention to short term results. Average investors can't make the same investments because they are largely locked out of those private markets. This is a market inefficiency, but it's likely to persist for a long time.

There are other explanations for such a trend as you describe that do not hinge on long term vs short term thinking.

For example, if you have control over a golden goose asset and managing it to maximize wealth is best achieved by sitting in a room with other oligopolists and carving up markets, that (1) may be best accomplished "in private" and (2) why share unfairly high profits if don't need to? This type of thing has occurred for example in the growth of cable TV companies, go public (yet maintain control) to get access to the capital necessary to grow your networks, then go private again (you already have control) to not have to dilute profit over and in the face of inefficient public regulation.

In any case, the idea that the market is too focused on the short term has been around for decades, and if the shift had occurred as you propose, then we wouldn't still be hearing it.

Algorithmics would disagree with you: the greedy algorithm, or trying to find a global maximum from local maxima, usually fails as a method. It's usually a "stupider" way of doing things :P

My own experiences, especially related to corporations, seem to corroborate this.

I think it's a mistake to apply ideas from the mathematics of functions (other than statistical functions) to "trendlines" observable in financial market data. The idea of local maxima, for instance, suggests to most people who've heard the term that you could find a maximum by finding roots of a derivative function, the proof of which is based on the dynamics of the underlying processes being discernable or model-able as a function.

To convey the intuition I'm trying to describe as quickly as possible, I think you're thinking of market data being useful to help you find the Old Faithful geyser, and once you find it you just need to hang around and scoop up the reliable expulsions. Coupled with the even worse idea that you can see it where nobody else can :) To continue the analogy, I think it's not Old Faithful you found, but a solar flare on the surface of the sun, and while waiting for the next one you are more likely to get scorched.

We aren't going to debate technical analysis here (or resolve it), the point I'm making overall is that people persistently believe that financial markets are leaving money lying around, that these people can see where nobody else can see it, and that is easy to bend over and pick up. I'm trying to use some fairly simple logic and explanation to say, "it's not that easy; if it was, how can you think an entire financial industry somehow can't see what you can see? Wall street hires people just like you."

I'm not sure where you're going with this, but it's digressed far from what I was talking about. To paraphrase your argument, you're talking about assuming convexity, which is a big deal in financial modeling.

If convexity isn't assumed, you're right back to my original point.

the observation that "the markets are too short term focused" is not a useful starting point for a moneymaking strategy because it can be shown with a simple explanation to a layperson that it isn't even an observation, it's a myth... is where I started and where I'm going.

I don't think using terms such as convexity explains anything to anybody, but if it indicates to you that the market is too short term focused, you should just print money with a derivative security that prefers companies that lose money in the short term because that will with no effort uncover all the long term strategies...

> This boils down to, statistically speaking, short term results are actually the best indicator of long term results. You'd be foolish (statistically) to overemphasize long term hypotheticals in the face of short term losses.

Amazon is an apt antithesis ... though obviously an outlier.

Amazon is not an antithesis at all, it's in my column! look, language is imprecise and none of us are writing encylopedias here that we reedit till they are perfect, so to keep it short:

Amazon is pursuing a long term strategy, and it's a public company, and it's getting funded, it's not getting starved for capital. i.e. the market is working, its strategy is being valued, there is no evidence of a market failure. (that is why I covered myself in my previous comment by saying "overemphasize" rather than simply saying emphasize.)

what would be your "antithesis" example would be other similar ideas that were floated and funding dried up because investors "stupidly" didn't get what a great long term idea it was. Of course, nobody can know what woulda coulda, and I'm not saying anybody can; what I'm saying is, if somebody thinks that markets don't properly weigh the long term over the short term, they are essentially saying that they want to sink more of their money into these (hypothetical) "losers" and I'm saying, please don't, it's a bad idea to assume that you know more than people actually in that industry.

I'm also not saying "don't think you have better ideas" and I'm not saying "don't pursue your good ideas" etc. I'm saying, don't think that financial markets are stupider than you. Don't think that the world is this hugely unfair place where all the people with money don't know a good idea when they hear about it, and that all these people with no money have all these great ideas that money seems to make people blind to (which is what "markets just don't get long term like I do" is saying)

It already has. It's the reason that one of the richest people in the world is Warren Buffett.

Or the issue that often the real costs aren't on the companies balance sheet at all. The cost of type II diabetes notably does not show up on food industries balance sheet. Just like the cost of smoking didn't show up in the tobacco companies balance sheets.