Home Forums Hunting & Shooting Hunter's Campfire wonder why California is broke and its universities graduate idiots?

A company can pay huge bonuses and high salaries while losing money if they have large reserves of cash and other assets without making a profit for some, maybe many years, depending on the amount of those reserves. How those reserves are spent is the decision of the board of directors. If it wants to piss it away on bonuses instead of putting it into plant and equipment so be it. No problem, but you might want to sell your stock (I would).

However, once those reserves are depleted and not replenished with profit the company goes bankrupt. This is a management issue not a Government issue and should be of no concern to anyone except the stockholders of that private company. In the normal course of events the company's stock would plummet and it would have difficulty raising capital because it doesn't have taxing power or a money printing press and it would cease to exist.