Why Stocks Just Won’t Drop: “Companies Spend Almost All Profits On Buybacks”
by Tyler Durden
ZeroHedge.com
10/06/2014
Back in May we revealed that the “Mystery, And Completely Indiscriminate, Buyer Of Stocks”, obviously a key player in a time when the Fed’s own indirect monetization of stocks was fading, was none other than corporations themselves, gorging on cheap debt and using the proceeds to buy back their own stock. And while we explained that the vast majority of companies are using up as much leverage as they can to fund said buybacks, with both total and net corporate debt levels having risen to new all time highs refuting misperceptions that corporate debt is actually declining, something even more disturbing was revealed today, when Bloomberg reported that companies in the Standard & Poor’s 500 Index, are “poised to spend $914 billion on share buybacks and dividends this year, or about 95 percent of earnings!”
The Rest…HERE
