1. What are the relationships among stock markets (share prices), large-scale layoff, and mergers and acquisitions as presented in the movie?
James Salinger’s tactic is to downsize the company to boost the share price to avoid a merger or acquisition. Salinger believes that a merger or acquisition will break down the company. The intention with the large-scale layoff is to make investors believe that the company will be more efficient and in return this will maximize the stock value for investors.
Why do the relationships become the way they are in the movie? Are there other kinds of relationships among these three phenomena?
Since the economy is in a recession there is no other way to boost the stock price than to do some sort of downsizing or restructure to prevent a merger or acquisition.
If an unexpected downsizing makes the investors afraid or if big layoffs occurs many times in a short time period stock prize can decrease. If the stock loses value it can increase the probability for merger or acquisition.
What are the relationships among these three phenomena in Singapore?
Since the article written by Michael Useem (1998) states that the financial market today is globalized I think the relationship between stock market, big-layoffs and acquisition and merger are pretty much the same in Singapore and the U.S.
2. What are the differences between GTX and the small construction contractor (played by Kelvin Kostner)? What makes the differences?
GTX is owned by the stockholders while Jack Dolans Company is owned by himself. This means that Dolan can decide for himself what to do and he doesn’t