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A comment on The ballooning money supply may be the key to unlocking inflation in the U.S.. Parent comment

Re:The ballooning money supply may be the key to unlocking i... by notherthrowaway on Tuesday October 13, 2020 @05:10PM (#24770335)
==That means that earnings were coming from somewhere, and if not from core consumer products, then presumably from other things that the stock-market-wealthy were buying from each other, at presumably inflating prices, or at least quantities.==

It isn’t a given that you need to increase earnings to increase your P/E ratio. The “E” is your Earning Per Share. Buying back shares lowers your denominator and magically increases EPS, which drives the price higher.

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Re:The ballooning money supply may be the key to unlocking i... by ric2b on Saturday October 17, 2020 @04:43PM (#24813185)
> Buying back shares lowers your denominator and magically increases EPS, which drives the price higher.

It also lowers your P, so the net effect should be 0, no?

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