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)
Jimmy Carter Redux
By John Schroy, on May 4th, 2009 | 
As of this writing, the term “stagpression” gathers only 145 hits on Google. This is probably because the term — meant to suggest high unemployment plus high inflation — does not convey this meaning effectively.
So we’re stuck with the term “stagflation”. Or maybe something like, “stagflation on steroids”, although this seems a bit hackneyed.
Under President Obama, the Carter combination of inflation and unemployment are likely to return — with a vengeance. Fed Chairman, Ben Bernanke, seems to have read the wrong books about the Great Depression.
US Politics
By John Schroy, on April 27th, 2009 | 
The Crash of 2008 put Barack Obama in the Oval Office and was the culmination of two secular financial trends: a growing US trade deficit that was the root of easy financing for credit cards and mortgages, and the stock buyback movement that manipulated the equity market and that, in recent years, had become dependent upon easy credit rather than corporate profits.
Americans now have an untested, inexperienced leader, with strange radical friends and a leftist deficit spending agenda. Obama must govern 300 million people in a serious economic crisis that he has the power to exacerbate.
In Obama’s first hundred days, the case of the Lincoln Bible, the Stimulus Bill, staffing problems, and the Maersk Alabama incident, hinted of difficult days to come for the United States.
Restoring investor confidence
By John Schroy, on April 23rd, 2009 | 
The Crash of 2008 revealed weaknesses in the US SEC’s ability to protect the public. SEC commissioners have more incentives to favor issuers and market institutions than ordinary investors.
Appointed for five years, after serving many commissioners go back to work for market institutions.
A commissioner that is too zealous in investor protection may be unemployed when his or her term expires.
This article discusses possible solutions.
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