Corporate America uses Trump tax cuts and offshore cash stockpiles primarily to fund share repurchases for better stock market valuation.

Jacob Miramar

2019-02-11 09:37:00 Mon ET

Corporate America uses Trump tax cuts and offshore cash stockpiles primarily to fund share repurchases for better stock market valuation. Share repurchases are a ubiquitous payout practice where public corporations buy back their own shares to return excess capital to shareholders. Share buybacks boost stock demand and so artificially inflate EPS concentration.

American public corporations initiate $1 trillion share repurchases in the fiscal year of 2018-2019. In contrast, business investments and job opportunities decelerate as a result. Rather than spending billions on share repurchases, U.S. corporations would help society more by reinvesting in profitable projects, plants, and high-skill human resources etc. For instance, Apple spends more than $30 billion on share repurchases in the fiscal year of 2018-2019. Apple also plans to pay $38 billion in taxes on offshore cash repatriation with 20,000 new jobs and $30 billion domestic capital investments in the next 5 years.

Several economic experts suggest that share repurchases disproportionately help the rich because the top 10% income earners own about 80% of U.S. stocks. This negative feedback loop self-perpetuates and exacerbates both income and wealth inequality as the rich reap rewards on their stock market bets to the detriment of the middle class.

 


If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.

Blog+More

Apple becomes the first company to hit $1 trillion stock market valuation.

Becky Berkman

2018-08-01 11:43:00 Wednesday ET

Apple becomes the first company to hit $1 trillion stock market valuation.

Apple becomes the first company to hit $1 trillion stock market valuation. The tech titan sells about the same number of smart phones or 41 million iPhones

+See More

Apple upstream suppliers such as Foxconn and Pegatron experience sharp share price declines during the Christmas 2017 holiday quarter.

Jacob Miramar

2018-11-21 11:36:00 Wednesday ET

Apple upstream suppliers such as Foxconn and Pegatron experience sharp share price declines during the Christmas 2017 holiday quarter.

Apple upstream suppliers from Foxconn and Pegatron to Radiance and Lumentum experience sharp share price declines during the Christmas 2017 holiday quarter.

+See More

The U.S. stock market delivers a hefty long-term average return of 11% per annum.

Peter Prince

2017-03-09 05:32:00 Thursday ET

The U.S. stock market delivers a hefty long-term average return of 11% per annum.

From 1927 to 2017, the U.S. stock market has delivered a hefty average return of about 11% per annum. The U.S. average stock market return is high in stark

+See More

Kourtney Kardashian shares the best money advice from her father.

Olivia London

2019-11-01 12:31:00 Friday ET

Kourtney Kardashian shares the best money advice from her father.

Kourtney Kardashian shares the best money advice from her father. This advice reminds her that money just cannot buy happiness. As the eldest of the Kardash

+See More

Tony Robbins suggests that one has to be able to make money during sleep hours in order to reach financial freedom.

Laura Hermes

2019-04-27 16:41:00 Saturday ET

Tony Robbins suggests that one has to be able to make money during sleep hours in order to reach financial freedom.

Tony Robbins suggests that one has to be able to make money during sleep hours in order to reach financial freedom. Most of our jobs and life experiences tr

+See More

Warren Buffett warns that the current cap ratio of U.S. stock market capitalization to real GDP seems to be much higher than the long-run average benchmark.

James Campbell

2019-08-24 14:38:00 Saturday ET

Warren Buffett warns that the current cap ratio of U.S. stock market capitalization to real GDP seems to be much higher than the long-run average benchmark.

Warren Buffett warns that the current cap ratio of U.S. stock market capitalization to real GDP seems to be much higher than the long-run average benchmark.

+See More