News for hackers. Stuff that matters.

A comment on Stock buybacks are dangerous for the economy. Parent comment

Re:Stock buybacks are dangerous for the economy by kgwgk on Tuesday March 17, 2020 @03:55PM (#22609559)
> the actual action in and of itself makes no sense from a business perspective.

It’s not a business decision, it’s a financial decision. Why do companies go into debt at all instead of financing their operations with equity only?

[ Parent | on HN ]
Re:Stock buybacks are dangerous for the economy by dlp211 on Tuesday March 17, 2020 @04:05PM (#22609680)
Risk mitigation. Financing operations in good times allows me to run my company in a downturn with cash on hand when lending tightens up.

Financing paying shareholders is the opposite of this.

[ Parent | on HN ]
Re:Stock buybacks are dangerous for the economy by kgwgk on Tuesday March 17, 2020 @04:13PM (#22609781)
That doesn’t answer the question. Why debt and not equity? Both can be used to raise cash.
[ Parent | on HN ]