@mpjgregoire stock buybacks can also be used to bump executive bonuses artificially. Buying a big block of stock leads to an increase in price. If the executive’s bonus is tied to stock price, they profit despite having created nothing of value.
I'd rather they pay employees more or invest in the company. Dividends cause money to flow to the investors and then probably the rest of the economy. Buybacks will more likely just make the investors feel temporarily richer and make the overall economy more tightly owned by a few rich people. I don't think I really understood this article.
@wjmaggos People buy and sell stocks; making all issued stocks more valuable by reducing the number that have been issued puts more money in the pockets of shareholders just as dividends do, but as capital gains (which normally are treated differently by taxes).
As for your article, I think its major point is that corporations borrowing money to send to shareholders is a bad idea. I agree.
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