1. Why Some of the Biggest Companies in the U.S. are Announcing Buybacks

    Why Some of the Biggest Companies in the U.S. are Announcing Buybacks

    America’s 500 biggest public companies in 2018 are expected to distribute up to $600 billion or more through stock buybacks. Even Warren Buffett , who for more than 50 years has avoided such a move, is considering offering a buyback to his 1 million shareholders in Berkshire Hathaway....

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    1. As the subject of repurchases has come to a boil, some people have come close to calling them un-American — characterizing them as corporate misdeeds that divert funds needed for productive endeavors.
    2. It increases share prices without giving the shareholder a tax liability.
    3. Buybacks are not productive investments.
    4. If the company buys back a share of stock, they give the money to a shareholder.
    5. Companies definitely seem to be planning to use a good amount of their tax savings to buy back stock.
    6. Public firms started with $3.3 trillion in cash in 2007 and accumulated 50 per cent more cash over the next decade, ending with $4.9 trillion in the bank.
    7. It's gone a long period now we've been in a bull market. And the best chance to deploy (cash) is when things are going down, obviously.
    8. Saying only rich people hold stock ignores the fact that Individual Retirement Accounts and 401(k)s and government and union pension funds own stock.
    9. If you're a taxpayer in Illinois, with its pensions deeply underwater, you better pray the stock market goes up.
    10. Companies have dramatically boosted their earnings, not by selling more stuff, but by buying back stock.
    11. Everybody would be screaming bloody murder if he started buying back at 1.5 book value.
    12. The $50 billion buyback was clearly a very poorly timed share buyback.
    13. We really want to move the company ... into a balanced total shareholder return of a mix of dividends and mix of organic investment and mix of share buyback when that makes sense.
    14. Buybacks were central to how Icahn made $2 billion in gains from buying and selling Apple shares.
    15. One thing companies have historically done is they have used their profits to keep people employed, give them higher and better wages and reward them for the productivity from that labour force that has generated the profits.
    16. That money doesn't go into a black hole.
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