Re:No Science, No Startups: The Innovation Engine We're Swit...
by computerphage on Monday October 13, 2025 @11:10AM
(#45569194)
Because before buybacks there were dividends. Did the difference between buybacks and dividends really make the difference between doing basic research and not?
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Re:No Science, No Startups: The Innovation Engine We're Swit...
by Retric on Monday October 13, 2025 @11:20AM
(#45569319)
Yes, dividends provide higher levels of exponential growth long term for an otherwise steady state company. It makes them more compelling than many long term investments.
Convert X% of a stocks value into a dividend and you pay taxes on that before you can buy more stock, but someone who keeps buying stock sees an exponential return. (Higher percentage of the company = larger dividends)
A company buys back X% of its stock functions like a dividend w/ stock purchase, but you’re effectively buying more stock without that tax on dividends. Adding a tax on stock buybacks could eliminate such bias, but it’s unlikely to happen any time soon.