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| Subject: Stock Buybacks In some countries, including the United States and the United Kingdom, corporations can buy back their own stock in a share repurchase, also known as a stock repurchase or share buyback. There has been a meteoric rise in the use of share repurchases in the U.S. in the past twenty years, from $5b in 1980 to $349b in 2005. A share repurchase distributes cash to existing shareholders in exchange for a fraction of the firm’s outstanding equity. That is, cash is exchanged for a reduction in the number of shares outstanding. The firm either retires the shares or keeps them as treasury stock, available for re-issuance. Under U.S. corporate law there are five primary methods of stock repurchase: open market, private negotiations, repurchase put rights, and two variants of self-tender repurchase, a fixed price tender offer and a Dutch auction. (Wikipedia Feb 2010) Phony financial reform By John Schroy, on July 17th, 2010 |  2 comments  Unfortunately, instead of a ‘game-changing’ confidence-inspiring reform, the Obama administration presented the United States with the Dodd-Frank Act — a legislative miscarriage that has the potential to hold back recovery and impair the position of New York as a world financial center for decades — unless repealed or drastically amended. July 17th, 2010 | Print Article |  Email Article |  Topics: Barack Obama, Barney Frank, Chris Dodd, complexity, Corporate Governance, Derivative Strategy, dividends, Economic Recovery, efficient market hypothesis, eurosystem, executive stock options, Great Depression, Jeff Skilling, Nobel prize in economics, Pecora Commission, pension plans, rating agencies, risk, Stock Buybacks, sub-prime mortgages, US Congress | Category: Financial Market Regulator, featured | 2 comments |  Short urlCorporate Governance: By John Schroy, on July 7th, 2010 | Leave a comment  M. A. Gumport of MG Holdings has published the July 2010 edition of the Buyback Monitor, showing corporate stock profits for 275 firms over the period 2000-2010. Without buybacks, share prices for the group now would be at least 5.3% higher (nearly 10% higher after adjustment for foregone interest income). The lack of attention to protecting long-term investors against the massive fraud of stock buybacks is just one more sign that it will be some considerable time before the US works its way out of the present financial morass. July 7th, 2010 | Print Article | Email Article | Topics: Corporate Governance, SEC Rule 10b-18, Stock Buybacks, US SEC | Category: Stock Buybacks | Leave a comment | Short urlThis is a 'game-changer' By John Schroy, on June 12th, 2010 | One comment  The current economic crisis, which started with the market crash of 2008, is a ‘game-changer’ that requires effective leadership with a firm grasp of economic reality and a willingness to introduce sensible bipartisan reforms in many areas of financial markets. Unfortunately, these conditions are unlikely to be met before 2016. In the meantime, history suggests that there are likely to be many false rallies and dashed hopes before true recovery begins. June 12th, 2010 | Print Article | Email Article | Topics: Adam Smith, Barack Obama, Capital Market Taxonomy, Constitutional Law, Dow Jones, Economic Recovery, fiscal deficit, Goldman Sachs, Great Depression, Inflation, Karl Marx, Lehman Brothers, Macro Economic Theory, NYSE, Obamacare, risk, Stock Buybacks, US SEC | Category: Macro and Micro Economics, featured | One comment | Short urlFeatured articles on inside pages
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