Klarman, the famed value investor who runs the Baupost Group, voiced similar concerns in early 2019. He told The New Yorker that shortsighted business practices were endangering public confidence in capitalism.
He has an ally in his Boston neighbor Grantham, founder of value shop Grantham, Mayo, Van Otterloo (GMO), who shared his own concerns with Citywire in an interview at his Beacon Hill home in mid-January.
‘I have a very low opinion of capitalism in 2019. We have reached a low point,’ he says.
‘The greatest manifestation of that is the massive emphasis on maximizing short-term profits, which is simply bad business. It is incredibly bad for society, and it’s not good for long-term growth rates. It tends to give you better short-term profit margins and lower economic growth.
‘For capitalism to work, you need there to be some sense of social contract – social discipline, if you will,’ he argues.
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