Musings on Markets: Dividends and Buybacks - Fact and Fiction

This data-driven analysis examines the rise of stock buybacks in the U.S. and globally, arguing that buybacks are primarily a symptom of globalization and lower returns on investment rather than evidence of managerial short-termism. The author challenges legislative proposals to restrict buybacks by presenting empirical evidence showing most buybacks are conducted by mature, low-growth companies with moderate debt levels, and argues that forced reinvestment into bad businesses would worsen, not improve, economic outcomes.