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

Re:Stock buybacks are dangerous for the economy by dlp211 on Tuesday March 17, 2020 @04:28PM (#22609958)
Consumers are supposed to have 3-6 months cash on hand in case of a downturn otherwise they are irresponsible. Big business just has to turn to the Government. Airliners made $28 Billion in profits last year and held onto none of it. When do we hold these companies accountable?

For the record, I would bail these fuckers out, but it would come with some hefty costs. Loans at 12%, reserve requirements, no ability to carry forward losses, more leg room, emissions requirements, and no more share buy backs. You want to return money to investors, you do it through dividends.

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Re:Stock buybacks are dangerous for the economy by JMTQp8lwXL on Tuesday March 17, 2020 @04:38PM (#22610107)
It's not irresponsible of some consumers to not have three to six of months of savings. See my other comment on this thought: https://news.ycombinator.com/item?id=22588933
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Re:Stock buybacks are dangerous for the economy by Retric on Tuesday March 17, 2020 @04:44PM (#22610176)
Conflating poverty with multi billion dollar companies is disingenuous.

Leveraged stock buybacks are essentially a bet that the company will fail as it maximizes investor ROI to fail with as much debt as possible. That destabilizes the economy and should be flat out illegal due to moral hazard.

It’s really simple. If companies can’t issue buybacks or dividends with outstanding debt or unfounded pension liabilities society is simply better off. Compromising to say cash on hand + 1/2 the value of physical property > debt is probably fine. Notice how neither of them would change the theoretical stock price of a company and thus invested returns, yet it’s a significant difference in reality.

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Re:Stock buybacks are dangerous for the economy by Ntrails on Tuesday March 17, 2020 @05:48PM (#22610841)
> If companies can’t issue buybacks or dividends with outstanding debt or unfounded pension liabilities society is simply better off.

This is just the sort of fun financial engineering challenge that will not end the way the rulemaker intended...

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Re:Stock buybacks are dangerous for the economy by Retric on Tuesday March 17, 2020 @07:26PM (#22611778)
As stated it’s easy to have a parent company receiving payments for IP by a subsidiary with debt. But, that’s also why laws are longer than just one sentence and interpreted by people not machines.
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