Trump Rages Against Buybacks, But It Was His Policies That Unleashed The Buyback Tsunami

By Tyler Durden | 21 March 2020

ZERO HEDGE — There is a distinct irony in Trump raging at company executives for announcing and executing trillions in buybacks in the past few years, most of which were accompanied by a tremendous increase in debt particularly in the lowest rated investment grade space and which now threatens to crash the entire US credit market: it was Trump’s tax policies that unleashed the wave of buybacks in the first place!

In recent days, amid the broad populist outcry against companies – such as Boeing and most US airline companies – that feasted on buybacks for years, sending their stock price and total debt to all time highs, only to demand a taxpayer buyback now that they actually need the liquidity, liquidity they would have had access to if only they had invested for a rainy day instead of making their shareholders richer by repurchasing stock.

President Trump has taken the lead in the blowback against buybacks when on Thursday he said that he would not oppose barring companies that receive federal assistance during the coronavirus pandemic from conducting stock buybacks. “It takes many, many people in this case to tango, but as far as I’m concerned conditions like that would be okay with me,” Trump said during a White House press conference adding that “he was never happy with that.” […]

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