News for hackers. Stuff that matters.

A comment on Visa, Mastercard mull increasing fees for processing transactions: WSJ. Parent comment

Re:Visa, Mastercard mull increasing fees for processing tran... by chrisbolt on Friday February 15, 2019 @01:14PM (#19173234)
The overlap of owners means nothing, as those are mutual funds or ETFs that are the top owners of most stocks on the market.
[ Parent | on HN ]
Re:Visa, Mastercard mull increasing fees for processing tran... by prickledpear on Friday February 15, 2019 @02:29PM (#19173934)
These mutual funds and ETFs actively participate in corporate governance, and the overlapping ownership of most stocks in the market is a very underrated problem.

Economists have found evidence that as ownership concentration increases, firms act more like a monopoly.

See this paper for one example in the airline industry: https://onlinelibrary.wiley.com/doi/full/10.1111/jofi.12698

[ Parent | on HN ]
Re:Visa, Mastercard mull increasing fees for processing tran... by nebolo on Friday February 15, 2019 @08:20PM (#19176360)
Participating in corporate governance and actively forming corporate strategy is a very different issue. And to my knowledge, ETFs and mutual funds do not participate in any meaningful way in management, i.e. they do not act as activist investors.
[ Parent | on HN ]
Re:Visa, Mastercard mull increasing fees for processing tran... by jasode on Saturday February 16, 2019 @06:54AM (#19178227)
>And to my knowledge, ETFs and mutual funds do not participate in any meaningful way in management, i.e. they do not act as activist investors.

There's been a trend towards more activism with passive indexes. One example with Blackrock's passive fund:

https://www.afr.com/business/larry-fink-says-blackrock-will-...

[ Parent | on HN ]
Re:Visa, Mastercard mull increasing fees for processing tran... by sjjshvuiajhz on Friday February 15, 2019 @01:35PM (#19173446)
It seems relevant - if company leadership is attempting to act in the best interests of the shareholders, the fact that the shareholders also own their competitors would tend to bias them against engaging in a price war (even one that they would have a good shot at winning).
[ Parent | on HN ]
Re:Visa, Mastercard mull increasing fees for processing tran... by currymj on Friday February 15, 2019 @03:29PM (#19174425)
there’s an ongoing debate about whether this situation actually does pose an antitrust problem across many industries.

it’s at least not totally implausible.

[ Parent | on HN ]