{"id":63549,"date":"2019-11-22T09:00:49","date_gmt":"2019-11-22T08:00:49","guid":{"rendered":"http:\/\/e3mag.com\/?p=63549"},"modified":"2020-02-07T23:07:52","modified_gmt":"2020-02-07T22:07:52","slug":"financial-engineering","status":"publish","type":"post","link":"https:\/\/e3mag.com\/en\/financial-engineering\/","title":{"rendered":"Financial Engineering"},"content":{"rendered":"

Large amounts of money are shifted for this purpose - always by legal means, but using dubious methods: the share price can be \"manipulated\" upwards.<\/p>\n

The recipe for this sounds almost like \"simple finance\". The company takes out a large loan - in other words, takes on a little debt. It uses this capital to launch a share buyback program.<\/p>

\"Fullsize\"<\/a><\/div>\n

You somehow buy yourself in the form of a backward loop, but that's another story. This money transfer \"credit becomes shares in your own company\" reduces the number of shares on the stock exchange.<\/p>\n

What remains to be hoped for: The value of the company remains the same, but because there are now fewer shares on the market, the remaining shares are naturally worth more.<\/p>\n

This beautiful and legal transfer of money from corporate debt to a higher share price has a name: Financial Engineering.<\/p>\n

Based on technical knowledge and specifications, a machine is constructed that controls money flows. Or, as can be read on Wikipedia:<\/p>\n

\"Financial engineering is a multidisciplinary field that encompasses financial theory, engineering methods, mathematical tools and the practice of programming.\"<\/em><\/p>\n

CFOs have mastered the paradox of turning a debt-ridden company into a more valuable one on the stock market. In the SAP press release, it sounds like this:<\/p>\n

\"Taking into account the positive financial development and a very solid balance sheet structure, the Supervisory Board of SAP SE has approved an increased capital distribution in 2020 as proposed by the Executive Board. <\/em><\/p>\n

Under this new program, the company is authorized to carry out share buybacks and\/or pay a special dividend totaling \u20ac1.5 billion until December 31, 2020.\"<\/em><\/p>\n

The Chief Financial Officer of SAP, Luka Mucic, says:<\/p>\n

\"In addition to an attractive regular dividend, share buy-backs and special dividends are important instruments for increasing the value of the company and sharing the success of our shareholders.\"<\/em><\/p>\n

He does not mention that the former industrial giant and Siemens competitor General Electric almost slipped into bankruptcy due to \"financial engineering\".<\/p>","protected":false},"excerpt":{"rendered":"

The three SAP musketeers have struck again and opened the money spigot: Co-CEOs Jennifer Morgan and Christian Klein and genial CFO Luka Mucic want to make everyone in the SAP community happy.<\/p>","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"pmpro_default_level":"","footnotes":""},"categories":[27840],"tags":[9961],"coauthors":[27825],"class_list":["post-63549","post","type-post","status-publish","format-standard","hentry","category-chefredakteur-blog","tag-simple-finance","pmpro-has-access"],"acf":[],"featured_image_urls_v2":{"full":"","thumbnail":"","medium":"","medium_large":"","large":"","image-100":"","image-480":"","image-640":"","image-720":"","image-960":"","image-1168":"","image-1440":"","image-1920":"","1536x1536":"","2048x2048":"","trp-custom-language-flag":"","bricks_large_16x9":"","bricks_large":"","bricks_large_square":"","bricks_medium":"","bricks_medium_square":"","profile_24":"","profile_48":"","profile_96":"","profile_150":"","profile_300":""},"post_excerpt_stackable_v2":"

Die drei SAP-Musketiere haben wieder zugeschlagen und den Geldhahn ge\u00f6ffnet: Die Co-CEOs Jennifer Morgan und Christian Klein sowie der geniale CFO Luka Mucic wollen alle in der SAP-Community gl\u00fccklich machen.<\/p>\n","category_list_v2":"Chefredakteur-Blog<\/a>","author_info_v2":{"name":"Peter M. F\u00e4rbinger, E3 Magazine","url":"https:\/\/e3mag.com\/en\/author\/peter-m-faerbinger-e-3-magazin\/"},"comments_num_v2":"0 comments","_links":{"self":[{"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/posts\/63549","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/comments?post=63549"}],"version-history":[{"count":0,"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/posts\/63549\/revisions"}],"wp:attachment":[{"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/media?parent=63549"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/categories?post=63549"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/tags?post=63549"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/e3mag.com\/en\/wp-json\/wp\/v2\/coauthors?post=63549"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}