via Bloomberg I by Kasper Viita and Mark Whitehouse I March 26, 2020

How the Stock Buyback Bazooka Has Been Silenced by Virus

“Against the backdrop of President Ronald Reagan’s deregulatory drive in the 1980s, restrictions on buybacks were loosened, executives were granted a safe harbor from stock-price manipulation charges and a culture of “shareholder value” was born. A wave of hostile takeovers made sitting on a pile of cash seem dangerous. And managers’ bonuses were increasingly tied to stock performance, to align their incentives with those of shareholders. The result? Buybacks boomed, often paid for with increased borrowing.”

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