Cross ownership
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219810971
2008-06-16T23:48:46Z
SieBot
4005189
robot Modifying: [[ja:株式持ち合い]]
'''Cross ownership''' is a method of reinforcing business relationships by owning stock in the companies with which a given company does business. In the US, it also refers to a type of investment in different mass-media properties in one market.
==Cross ownership of stock==
Some countries where cross ownership of shares is a major part of the business culture are:
* [[Japan]]
* [[Germany]]
Positives of cross ownership:
* Closely ties each business to the economic destiny of its business partners
* Promotes a slow rate of economic change
Cross ownership of shares is criticized for:
* Stagnating the economy
* Wasting capital that could be used to improve productivity
* Expanding economic downturns by preventing reallocation of capital
A major factor in perpetuating cross ownership of shares is a high [[capital gains]] tax rate. A company has less incentive to sell cross owned shares if taxes are high because of the immediate reduction in the value of the assets.
For example, a company owns $1000 of stock in another company that was originally purchased for $200. If the capital gains tax rate is 50% (like Germany) and the company sells the stock,
the company has $600 which is 40 percent less than before it sold the stock.
Long term cross ownership of shares combined with a high capital tax rate greatly increases periods of asset deflation both in time and in severity.
==Media Cross Ownership==
Cross ownership also refers to a type of media ownership in which one type of communications (say a newspaper) owns or is the sister company of another type of medium (such as a radio or TV station). One example is ''[[The New York Times]]'' 's ownership of [[WQXR]] Radio and the ''[[Chicago Tribune]]'''s similar relationship with [[WGN]] Radio and Television.
The [[Federal Communications Commission]] generally does not allow cross ownership, to keep from one license holder having too much local media ownership, unless the license holder obtains a waiver, such as [[News Corporation]] and the [[Tribune Company]] have in New York.
The mid-1970s cross-ownership guidelines grandfathered already-existing crossownerships, such as ''Tribune''-WGN, ''New York Times''-WQXR and the ''[[New York Daily News]]'' ownership of [[WPIX]] Television and Radio.
[[Category:Management]][[category:Strategic management]]
[[he:בעלות צולבת]]
[[ja:株式持ち合い]]