buybacks Markets S&P 500 stocks

Imagine A World Without Buybacks…

“Is this really what everybody wants?”

“Is this really what everybody wants?”
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6 comments on “Imagine A World Without Buybacks…

  1. Last paragraph hits the nail on the head: it’s all about lining up the right incentives through legislation or regulation (e.g., incentivize employee compensation or capex over buybacks)

    Incentive structures aside, it seems like the ‘EPS inflation’ effect is the main problem weighing against the benefits of buybacks. Why not force companies to report something like a ‘real’ vs ‘nominal’ EPS, where ‘real’ EPS adjusts for buybacks that quarter? Seems silly to have such an obvious spread between aggregate earnings growth and EPS earnings growth.

    P.S. already missing the old type font.

  2. Before 1982,buybacks were illegal.
    Post 1982 wealth inequality soared with the GINI coefficient of the US up there with 3rd world countries and almost as high as the late 1920s
    Corporate fascist capitalism is hoping to self-destruct due to its incredible greed

  3. Goldman reminds you that buybacks are the largest source of demand for US equities

    If Newton’s First Law of Motion still applies, then I’m thinking there must be some kind of short here. The current buyback paradigm will change. When and by how much is the question.

  4. For now, this has virtually no chance of becoming law, and is more an expression of empathy for workers than a well thought through proposal. And what would happen if, instead of buybacks, the companies started capex or R&D spending to increase automation, and eliminate jobs? Or spent the capex budget on a production facility abroad to reduce US employment? There are better and more direct ways to attack the issues of stagnant wages and income inequality.

  5. Slade Grenville

    Come on, don’t be so ‘neutral’ and blase. You know – as does every other 1%er profiting off the casino – that buybacks is essential element of the grande Ponzi. Until the likes of Marks and Blankenfien (and now GS itself) drop the charade – you can bet socialism USA will be upon us by 2020.

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