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Yes it's permanent. Interest rates are still super low, meaning companies can still take on debt to buy back their stock. The effect of quantitive easing remain

by tma-1 10y ago

Yes it's permanent. Interest rates are still super low, meaning companies can still take on debt to buy back their stock. The effect of quantitive easing remains until interest rates start going up and the Fed start buying government bonds from the banks.

dgemm 10y ago
Interest rates have already started going up.
- turnip1979 10y ago
  They went up once and the fed is signaling a lot of caution. The earlier analyst consensus was 4 hikes this year .. it is down to 2. The latest commentary I'm hearing says normal rates by 2019 .. which is psycho IMHO.
forgetsusername 10y ago
>meaning companies can still take on debt to buy back their stock Please explain the problem here. You're acting like there's some big deception imposed on the public due to companies choosing to return capital to shareholders via one specific mechanism. As if somehow they're buying back stock and "fooling" people into thinking they're making more money or something, and stock prices are irrationally rising. The buybacks, earnings, financials are all open for everyone to read. It's evident by some of your commentary that you can't be bothered. If you don't agree with the price that other people are willing to sell for shares in this market, you are more than welcome to take the other side of that trade and sell into every buyer on the planet. I'm sure you're not doing that.
- tostitos1979 10y ago
  Shorting a stock isn't always practical. Stock buybacks can be deceptive if a company buys back stocks with debt and doesn't have proper cashflow to pay it off. Non-technical investors see the stock going up and keep piling more cash in. If you think markets are perfect, you have a lot to learn my friend.
  - forgetsusername 10y ago
    >Shorting a stock isn't always practical. Nor is it remotely the only way to assume a bearish position. >Stock buybacks can be deceptive if a company buys back stocks with debt and doesn't have proper cashflow to pay it off. You can't tell the cash flow and debt levels from the financial reporting? You don't account for this in your valuation? Where is the deception? Report it to the SEC. >Non-technical investors see the stock going up and keep piling more cash in. An equivalent number of people are "pulling cash out". A stock trade is just that: a trade. Again, what makes you a better judge of the "correct" price than those actually making the deal? >If you think markets are perfect, you have a lot to learn my friend Not sure where that comes from, but you're right, I do have more to learn. That said, it looks like I'm a few levels up on you (and far less confident in my ability to predict anything).

by tma-1 10y ago

dgemm 10y ago

Interest rates have already started going up.

turnip1979 10y ago
They went up once and the fed is signaling a lot of caution. The earlier analyst consensus was 4 hikes this year .. it is down to 2. The latest commentary I'm hearing says normal rates by 2019 .. which is psycho IMHO.

forgetsusername 10y ago

>meaning companies can still take on debt to buy back their stock Please explain the problem here. You're acting like there's some big deception imposed on the public due to companies choosing to return capital to shareholders via one specific mechanism. As if somehow they're buying back stock and "fooling" people into thinking they're making more money or something, and stock prices are irrationally rising. The buybacks, earnings, financials are all open for everyone to read. It's evident by some of your commentary that you can't be bothered. If you don't agree with the price that other people are willing to sell for shares in this market, you are more than welcome to take the other side of that trade and sell into every buyer on the planet. I'm sure you're not doing that.

tostitos1979 10y ago
Shorting a stock isn't always practical. Stock buybacks can be deceptive if a company buys back stocks with debt and doesn't have proper cashflow to pay it off. Non-technical investors see the stock going up and keep piling more cash in. If you think markets are perfect, you have a lot to learn my friend.
- forgetsusername 10y ago
  >Shorting a stock isn't always practical. Nor is it remotely the only way to assume a bearish position. >Stock buybacks can be deceptive if a company buys back stocks with debt and doesn't have proper cashflow to pay it off. You can't tell the cash flow and debt levels from the financial reporting? You don't account for this in your valuation? Where is the deception? Report it to the SEC. >Non-technical investors see the stock going up and keep piling more cash in. An equivalent number of people are "pulling cash out". A stock trade is just that: a trade. Again, what makes you a better judge of the "correct" price than those actually making the deal? >If you think markets are perfect, you have a lot to learn my friend Not sure where that comes from, but you're right, I do have more to learn. That said, it looks like I'm a few levels up on you (and far less confident in my ability to predict anything).