>Why would CEOs prefer buybacks to dividends? Because CEOs sit on tons of shares. Even if only some of those shares have vested, a CEO who uses this ruse to inc

>Why would CEOs prefer buybacks to dividends? Because CEOs sit on tons of shares. Even if only some of those shares have vested, a CEO who uses this ruse to increase share prices can cash those shares out, borrow against the rest, and count on a big stock grant from shareholders who are grateful for their windfall. If the CEOs sit on tons of shares, the CEOs would receive a large dividend too. So the CEO would benefit from both dividends and stock buybacks. And "shareholders who are grateful for their windfall" would be grateful for both dividends and stock buybacks. And announcing a dividend tends to make the stock go up, as seen when Google announced a dividend earlier this year. So the big distinction the article is trying to make between dividends and buybacks doesn't make sense to me.