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      03-26-2019, 03:56 PM   #25
Jockey
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Quote:
Originally Posted by 2000cs View Post
Quote:
Originally Posted by Jockey View Post
That's easy. This was sold as trickle down. The corporations make more profits by paying less taxes, this trickles down to the employees by pay raises, bonuses, etc.

My company has done an amazing amount of stock buybacks this last year and some of my very conservative coworkers are losing their minds thinking that money should have gone to them (the employees).
The only problem with stock buybacks is that it signals the company has no better investment than its own stock. No growth opportunity, no acquisition, no equipment.

But a stock buyback also flows back to the economy. Funds go to shareholders who tender their shares. What do they do with the money? Invest in some other companies? Buy a car? Pay taxes? Those and more? All in all, they use the money more efficiently than the company doing the buyback would have, so it’s a good thing. And ultimately that will result in more jobs and more worker pay. It may not be as direct as using the tax savings to hire people or give raises, but it gets there eventually.
The thing is, I don't have problems with a company doing stock buybacks. Anyone with half a brain knew how the corporate tax cuts were going to pan out. That money wasn't going to the workers, it was going to the shareholders.

If that allows the company to become more resilient during an economic downturn, even better.
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