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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 throw0101a on Wednesday March 18, 2020 @07:23AM (#22615401)
> When a company buys back stock the market takes it as a "signal" that the shares are undervalued for reasons that are unknown to the public.

Does not the company have to pre-announced its plan to run a buyback program (both in the amount and time frame)? Does not pre-broadcasting that achieve the result of making sure everyone has the same information?

Executives also have to file ahead of time paperwork to say that they're buying (selling) stock in the company that they run IIRC.

Is that not sufficient to allow the trading public to make decisions on?

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Re:Stock buybacks are dangerous for the economy by elliekelly on Wednesday March 18, 2020 @10:32AM (#22617031)
Announcing it ahead of time doesn't make a difference because the market still doesn't know what the material information is or even whether it exists. It's like management saying "I know something you don't knowww ;)" and leaving the market to sort out whether or not that's a meaningful and reliable piece of information.

My point is that there often isn't any material nonpublic information underlying the buyback so it only serves as a way to juice the stock price in the short-term by manipulating the psychology of the market. It's also worth noting that these transactions were illegal until Rule 10b-18 specifically exempted them from market manipulation and deception rules.

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