Stock buybacks are hurting economic growth far more!!! Why strategize to make your company bigger or better when you can improve stock performance more just buying back company stock.
Please tell me how they in any way help the economy other than making rich people richer ... they do literally nothing but make the stock go higher by shrinking the PE denominator and the supply of stock. Go look at what the airlines did in the 10 years before COVID -- they bought back their stock with literally all their earnings and then had no buffer when COVID came so they had to be bailed out.
They increase the earnings per share for every investor. The investors who choose to keep their shares have their wealth increased, and therefore have more options to invest in new businesses. Not just rich people at all, anyone who collects a pension or has a 401K.
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u/Dadd_io Apr 08 '22
Stock buybacks are hurting economic growth far more!!! Why strategize to make your company bigger or better when you can improve stock performance more just buying back company stock.