Re:US Federal Reserve says its goal is ‘to get wages down’
by marcus0x62 on Saturday May 28, 2022 @05:15PM
(#31543936)
Apple has issued debt to buyback shares [0]. One problem many large tech companies have is that their cash is stranded overseas due, in part, to…creative…tax/accounting arrangements [1]. They lobbied [2] for years for a tax break to repatriate this cash, and eventually got a tax break on repatriation for “foreign” profits close to what they had asked for [3]. Before that law was passed, it was common to borrow to fund share buybacks due to not wanting to pay the repatriation tax. As far as I can tell, it is still common due to the low interest rate environment of the last several years.
0 - https://www.nasdaq.com/articles/apple-shores-up-%2414b-in-de...
1 - https://www.news.com.au/technology/online/security/double-ir...
2 - https://money.cnn.com/2011/02/16/news/companies/repatriation...
3 - https://marketrealist.com/2018/02/cisco-bringing-67-billion-...
Re:US Federal Reserve says its goal is ‘to get wages down’
by JustAPerson on Saturday May 28, 2022 @05:17PM
(#31543948)
A substantial portion is funded with newly issued debt.
https://fortune.com/2019/08/20/stock-buybacks-debt-financed/
https://www.bloomberg.com/news/articles/2019-01-27/debt-fina...
Re:US Federal Reserve says its goal is ‘to get wages down’
by anm89 on Saturday May 28, 2022 @05:22PM
(#31543981)
The parent is just saying hyperbolic things to bolster their rant. Their is no direct connection between the Fed's balance sheet and buy backs.
The connection you could make is that by creating generally easy financial conditions like a strong market and low rates, they enabled the atmosphere which promoted the buybacks. But this is far from a direct connection
Re:US Federal Reserve says its goal is ‘to get wages down’
by howmayiannoyyou on Saturday May 28, 2022 @05:13PM
(#31543919)
Debt is often used. But nowhere near the $8t this poster is whining about in their tantrum.
Aren't stock repurchases funded by cash on hand, like Apple does?