30 years ago archangel not 100, stock buybacks were illegal from 1934 until 1982. Stock buy backs were made illegal by the 1934 SEC Act. The act did not explicitly say " stock buy backs are illegal" it said stock manipulation is illegal. It was common knowledge from 1934 until 1982 that stock buybacks were stock manipulation.

I get what you are saying about stock buy backs being cheaper than dividends because stock buy backs are considered a return of capital and taxed at capital gains.

I think the picture is actually a bit wider than I've been saying. But I don't have all my ducks lined up. It seems like the Trump Tax cuts made company's more profitable over night by dropping the corporate tax rate to 21%. Company's had extra cash and this attracted more investors. That is why if you look at many major company's you see a huge market cap. increase in 2017. The money had to come from some where so maybe people invested more capital expecting stock buy backs or dividend pay outs or maybe institutions borrowed money because interest rates are so low for the same reasons.

Now company's had a bigger chunk of equity holders, but they hadn't increased their earnings by the rate required to maintain the new market cap. what if they begin using their tax savings in addition to borrowing if necessary because of the low interest rates to do stock buy backs, this would decrease the number of equity investors and increase the earnings per share, in the second year, you have the same problem multiplied. Maybe this is why company's have excessive amounts of debt on their books?

Interestingly, the vast majority of EPS-related articles I have seen regarding buybacks don't point to goosing EPS to try and fool investors.

Instead, they are tied to executive bonus structures that (shockingly to me) don't take buyback influence into account regarding how EPS relates to their compensation.
(rather than having the sense to determine an adjusted/corrected-EPS that smooths out the bump from the buyback)
Though it sounds like that issue stems from executives more or less being the sole word on their performance-based compensation, where the board just has the ability to replace them, rather than deal in those specifics.


But I really do have a hard time believing that analysts and institutional investors don't "know better", on that particular point.

 

I think analysts and investors know what is going on and are playing the game. I think the every day person who puts their money in an IRA or index fund etc. and sees their retirement going up may assume the economy is doing well and that Trump is doing a good job with the economy. In actuality, it seems like investors and businesses are playing a game of musical chairs with massive amounts of debt and aren't increasing earnings through reinvesting in the business. So, while some people may assume the economy is doing well because the stock market is up, the economy is actually on shaky legs.

My point was that the "everday person" is a relatively small portion of the market, in terms of direct investment in individual stocks.

I've seen estimates that that only 10% of trading volume is individual stock picking, anyway.   (with the majority of trading activity coming from passive investing purchases -- i.e. ETFs/funds or plan-provided advisor activity -- and quantitative investing -- i.e. algorithmic trading that should "know better" on this specific issue)



Very well could be a musical chairs regarding debt (and execs goosing EPS to boost their own compensation) -- I would just be skeptical that that specific metric is also propping the market in the eyes of buyers (rather than the much more obvious impact of capital flowing directly to buy up shares)




Completely agree with you on the economy, itself, not being what Trump-and-crew purport, though.

The most discussed unemployment numbers have failed to represent real unemployment for a long time. 
(similar to how CPI numbers have provided fairly BS inflation numbers for a long time)

And it should be no mystery that consumer prices going up do to tariffs isn't going to be helpful to the economy or the general public's finances.
(and then we have today's wonderful news of China devaluing their currency in response to the latest round of tariffs)

Interesting that you say four years when he's been president for less than three. He inherited a rising economy and only had to not screw it up. Unfortunately some of the things he's advocating might do just that.

 

Trump is racist, and his anti-immigrant rhetoric is contributing directly to mass shootings by wanna-be white nationalists.

Prove me wrong, I will be happy to read your opinions/ facts to back up your statements.

Thank God the corrupt NRA is going down the crap shoot, I cannot wait until their money is out of politics.

I hope whoever wins/ gets nominated has some semblance of smart gun control, instead of all these idoits offering hopes and prayers while taking NRA money (looking at you Trump, and #massacremitch)

What exactly has Trump been right about?
 

Wasn't this thread locked?

In the true spirit of this thread I must remind everyone that no one cares about politics.

Go play some videogames !

I am ok with talking about some world news but specifically politics this crap has to go tbh

No, it was another thread. And if you dont want to talk about it, no one is making you click the link. 

PS: this is everything else, where we talk about non gaming things. 

See my previous post. 
 

Well thats my opinion you know? Just like yours you know? Yea thats right, we both got our points and can give...you know what, yea? Cool

We argue to death about the way the site is run, why not the country?

Anyone other than biden or gabbard in the general election will be slaughtered. Everyone else running is a hillary clone, Bernie clone, or some combination thereof. Bunch of no compromising primadonnas trying to get lazy people to vote by promising them free shit like college and healthcare. Or jacking the Fed. Min wage to more than double what it is now. Or student loan forgiveness (essentially an enormous handout). Guess what? These promises to your average lazy American that's too lazy to simply work hard and do a good job to earn the money that's right there if werent to damn lazy to go get it wont matter. Why? These lazy Americans will be too lazy to go vote. Where's my Democrat that says go out and work hard? You might have to go do a job you dont like, but you can indeed make it in this world! Obama was that guy! I remember him giving a specific speech saying exactly that.

Oh gee, I'm sorry to all those college grads that got swindled by accepting a bad loan for a degree in a field that is either too competitive or just plain poor earning. Im sorry that your BA in women's studies or communications isn't yielding the returns whatever wack university you went to promised. I have a better idea. Rather than clamor for loan forgiveness and whine about underemployment, go blue collar! Get your CDL and drive! Get into HVAC training, plumbing, electrical, anything tradesworthy! There isn't enough skilled workers around. You would make upwards of 20 hr depending on your location to start with benefits. Get into healthcare! Hell, nurse aides make 16 minimum around here, and that's simply a 1000 dollar course. Put your time in at a single facility long enough and you will see your pay rate creep up to the point of affording a solid mortgage. Go wait tables or bartend! If you are half decent at sales and customer service, you will make some money. Server's at the restaurant i was working at typically pull in 150 to 200 a night! Bartenders pull extra! Shit, mediocre line cooks make 13 hr around here. Not even good ones.

Is that the six figure salary these lazy assholes were promised out of school? No, it's not. Those six figure salaries go to the not lazy college grads that are hungry enough to earn it. That 70 k income you would get instead will get you a nice life. Just get your hands dirty.

I believe in social equality. All people should be treated as equals so long as they follow the laws of the land. I do not believe in financial equality. I believe in capitalism. Stop crying about the 1%. The money is right there. Just go get it!

/end rant

BTW, Trump already pulled the "violent video games are to blame" card for the shootings. It would be hilarious if it wasn't so tragic. Specially when he is promoting racism right and left. https://edition.cnn.com/2019/08/0...

Archangel, conpletely agree on unemployment, it's really impossible to accurately compare the rate between periods since they stop counting anyone who hasn't looked for work in four weeks.

I get CPI conceptually, and understand the formula, but I didn't know you could manipulate it. Do thry pick out items to measure inflation that aren't representative?

Did anyone hear that Trumps FDA is going to continue allowing the use of that pesticide that causes brain damage to children? I don't know if there's a word for that besides evil.

It's so easy to give the ol' up by your bootstraps argument, but the reality isn't that simple.

I'm a lawyer. Looking at salary alone, I do pretty well, but I'm approximately $300,000 in debt and my best hope is public student loan forgiveness. I keep my personal costs down and save for retirement to take advantage of employer matching contributions. But I had to take out multiple credit cards and max them out in order to pay the bills while studying for the bar, moving to my job, and staying afloat until my first paychecks came in. Between the credit cards and student loans, I was barely breaking even but slowly chipped away at my debt. I eventually got an even better job and wiped away all my non-student loan debt. Then I lost my job. I ran up the debt again while searching for what became my current job, and I'm back where I was before: breaking even and slowly chipping away at debt, praying I don't have a serious accident that breaks the equilibrium. My girlfriend has it worse. I won't share her details because she wouldn't want me to, but suffice it to say she has had the medical emergencies that I've been fortunate enough to avoid, and despite her spartan lifestyle doesn't always know if she'll make rent in addition to the payments on her debts.

A lot of us are doing our best and trying to make the most of our situations, but the system itself seems arrayed against us. And yet we see rich morons like Trump get richer by overleveraging their properties and essentially capitalizing on bankruptcy. I would love to fail up into billions of dollars, but I guess I'm too busy working hard and playing by the rules. And a lot of us on all shades of the political spectrum just want some systemic change that means one accident doesn't break us for years on end. Because it isn't as simple as "go bartend" or "get HVAC certified".

 

Basically, it has to do with how they choose the "basket of goods" regarding substitutions.
(i.e. if people eat less beef, we'll substitute a pound of chicken for a pound of beef when figuring the cost of the basket)

There are a lot of games that can be played that way to make inflation look lower than it really is.

I have some questions for you. Please do not take them personally as this happens a lot discussing politics. Feel free to not answer anything you feel too personal.

Where did you go to school? Did you live on or off campus? Did you have the opportunity to work while in school, especially during Freshman and sophmore years and did you work as much as you could have? Could you have taken pre-reqs at less expensive schools and transfer in? Did you apply for as many scholarship and grants as you could have and/or took steps to qualify for them?

Do you still live in DC/NOVA? Have you considered finding work somewhere considerably less expensive but relatively nearby such as Richmond or Spotsylvania County? Are you a property owner with equity built up(God Bless you if you are property owner in NOVA/DC)? If you are unliscenced in VA, have you considered moving to Spotsy and commuting in? 

Is your projected income going to increase at your current job? If so, will it be at a rate high enough to make offsetting the equalibrium worthwhile? 

Financial decisions you make when you are young follow you into your adulthood. Are you pursuing your passions with your law career? Passion can carry financial risk, though dreams are absolutely worth shooting for.

Finally, are you happy with your career whether with job satisfaction or income? Is it all worth it to you? If you, hypothetically, were giving advice to your 16 year old son about college/university, would you reccomend the path you took?






 

Precisely, and your line of questioning about those decisions is to uncover mistakes. Better if the system is not built to fuck people over so CEOs can get millions. Better if a year’s tuition could be covered with wages from a summer job (like it used to be). You have great ideas for financial planning from the present forward, but you can’t sit around and tell every poor bastard out there how stupid they were, while everything else is out of control as long as it benefits the top tier. My parents would have shit if I told them I wanted to go to trade school rather than college. What is a 17, 18 year old kid supposed to do with that? 
 

it would be crazy if they ever actually forgave college debt. a lot of americans put their dreams on the back burner because they analyzed the cost to pursue those dreams vs pursuing an alternate career path that didnt come with a mountain of school debt and chose the wiser of the two paths. only to later be told that their intelligent decision is flipped on its head with a govt bail out. lol

id be one of the people that gets royally shafted if loan forgiveness happens, but damn i dont think i could be mad with how funny that whole situation is.

college tuition is fucked, but thats what happens when for 40 years every parent tells their kids how bad being a trade worker is. (plumber janitor garbage man etc)

Jacob why would you get shafted if the have college loan forgiveness? I'm not understanding how it negatively affects anyone.

cause i made life decisions that didnt involve going to college due to the cost of the tuition. so if i would have known that cost would have been forgivin anyways my life would have been on a drastically different path.

 

Did you say you are in the trades? Do you have a business?

im a real estate investor

edit: i rennovate distressed properties. so im in the trades, pretty much every trade in contracting. im also the realtor on the deals.

For sure. The reason I ask is because in addition to all the people who have student loans that directly benefit because of the loan forgiveness, the next major beneficiarys are business owners. The fact that many college graduates are locked into paying loans for 20 years is a drag on the economy. The money people spend on paying back loans is money they aren't using to go out and eat more often, take a vacation, or buy a home. This would work for the economy the same way the infrastructure spending works or the Obama stimulus package worked, it could potentially prevent the upcoming recession or may even help us out of a recession after one begins.