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That's not what's happening, though. US companies are increasingly borrowing in order to execute buybacks, not using cash reserves to do it. http://www.reuters
by vox_mollis 11y ago
That's not what's happening, though. US companies are increasingly borrowing in order to execute buybacks, not using cash reserves to do it.
http://www.reuters.com/article/2015/09/23/us-usa-fed-buybacks-analysis-idUSKCN0RN0D320150923 http://www.reuters.com/article/2015/09/23/us-usa-fed-buyback...
Edit: downvotes? Perhaps another source: http://www.wsj.com/articles/the-new-bond-market-debt-investors-wary-as-offerings-fuel-buybacks-1442859162 http://www.wsj.com/articles/the-new-bond-market-debt-investo...
- Lazare 11y agoEconomically, that's irrelevant. What we want is for capital to flow towards people with good ideas on how to invest it. It's not incredibly important whether this happens by: One: Apple making a ton of cash, and investing it in a great idea their CTO had. Two: Apple making a ton of cash, returning it to investors, who invest it in a great idea some startup's CTO had. Three: Apple making a ton of cash, investing the cash in the markets, borrowing a ton of cash on the markets, and investing that cash in a great idea their CTO had. Four: Apple making a ton of cash, investing the cash in the markets, borrowing a ton of cash on the markets, returning it to investors, who invest it in a great idea some startup's CTO had.
- supercanuck 11y agoI suspect some of this has to do with thr tax deductability of interest too