Warren Buffett educates Biden on stock buybacks

[Bucky]

The legendary investor also defended stock buybacks. Last year, the U.S. government imposed a 1% tax on them—a late addition to the Inflation Reduction Act—and Biden has signaled support for raising it.

“When you are told that all repurchases are harmful to shareholders or to the country, or particularly beneficial to CEOs, you are listening to either an economic illiterate or a silver-tongued demagogue (characters that are not mutually exclusive),” he wrote.

Warren Buffett highlights a ‘shame of capitalism’ while taking a shot at Biden and celebrating the virtues of Coca-Cola

The Berkshire Hathaway CEO published his annual letter to shareholders on Saturday.

www.yahoo.com

Warren even at his advanced age has time to educate people from the financially illiterate - Biden, Sanders, Warren.

 

[LouC]

So?

What was the alleged education of President Joe Biden by Buffett?

 

[Integrityrespec]

Warren Buffett highlights a ‘shame of capitalism’ while taking a shot at Biden and celebrating the virtues of Coca-Cola

The Berkshire Hathaway CEO published his annual letter to shareholders on Saturday.

www.yahoo.com

Warren even at his advanced age has time to educate people from the financially illiterate - Biden, Sanders, Warren.

So in other words Joe wants you to screw your company and the people that invest with you. I'm really starting to dislike that guy.

 

[dmpi]

Joe is just a puppet for the left and the left is just using stock buybacks as a punching bag because the masses are financially illiterate and looking for anyone to blame except for themselves.

 

[Slyfox696]

I'm really starting to dislike that guy.

You do realize your posting history here is public, correct? No one believes you're "starting" anything.

So?

What was the alleged education of President Joe Biden by Buffett?

Republicans live in their own fictional reality. They don't even try to pretend to live in the real world anymore.

 

[Individual]

Warren Buffett highlights a ‘shame of capitalism’ while taking a shot at Biden and celebrating the virtues of Coca-Cola

The Berkshire Hathaway CEO published his annual letter to shareholders on Saturday.

www.yahoo.com

Warren even at his advanced age has time to educate people from the financially illiterate - Biden, Sanders, Warren.

I had not heard about the 1% tax on stock buybacks, though I have in the past suggested there should be a Federal tax on stock purchases, which would provide an enormous amount of revenue.
I would also make the taxation of public traded corporations/businesses relative to how much of the profits were distributed as taxable income to the investors, the greater the distribution the lower the tax rate.

 

[LouC]

You do realize your posting history here is public, correct? No one believes you're "starting" anything.

Republicans live in their own fictional reality. They don't even try to pretend to live in the real world anymore.

 

[justabubba]

biden needs to invite Buffett to the white house for a discussion/education
joe needs to understand what Warren is saying

https://www.cnbc.com/2023/02/07/bid...king-in-state-of-the-union-he-wants-more.html

 

[Ahlevah]

“When you are told that all repurchases are harmful to shareholders or to the country, or particularly beneficial to CEOs, you are listening to either an economic illiterate or a silver-tongued demagogue (characters that are not mutually exclusive).”

Warren Buffett

My understanding is “The Oracle of Omaha”supported Joe Biden for president. If he now characterizes Joe as an “economic illiterate” or a “silver-tongued demagogue,” what does that make Warren? Answer: a moron.

 

[Ahlevah]

Republicans live in their own fictional reality. They don't even try to pretend to live in the real world anymore.

So what is “the real world” anyway? Give everybody free shit and pay for it by “soaking the rich” for their “fair share,” right?

 

[Bucky]

You do realize your posting history here is public, correct? No one believes you're "starting" anything.

Republicans live in their own fictional reality. They don't even try to pretend to live in the real world anymore.

Has Biden ever run his own business?

Scratch that. Has he ever worked a job or has he been a career politician?

 

[Slyfox696]

So what is “the real world” anyway?

The one where most of us live. You can tell the real world from the fantasy world created by Republicans because the real world relies on facts and data.

Has Biden ever run his own business?

Have you ever gone skydiving? Has about the same relevance.

 

[Bucky]

The one where most of us live. You can tell the real world from the fantasy world created by Republicans because the real world relies on facts and data.

Have you ever gone skydiving? Has about the same relevance.

Skydiving you can accomplish in one-day.

Working a 9-5 job or running a business? Biden has never understood that lifestyle.

 

[Slyfox696]

Skydiving you can accomplish in one-day.

I see you completely missed the point.

 

[Bucky]

Warren Buffett, in his letter, should issue a masterclass on how the economy works.

An “Economics 101” class teaches us about the multiplier effect — every time there is an increase in spending, it produces an increase in national income and consumption greater than the initial amount spent.

Stock buybacks are an excellent example of this effect at work. As shares are repurchased, the cash is used in a productive manner that benefits many Americans, from both the reinvestment of the proceeds or the spending of the distribution of the proceeds.

Here's why Sens. Schumer and Sanders are wrong on stock buybacks

Two U.S. senators criticized $4 trillion of share buybacks completed from 2008 to 2017. It is important to understand that this very large amount of cash did not vaporize, nor did it benefit just a small handful of people. Rather, it was used to positively impact the U.S. economy overall.

www.cnbc.com

Democrats go with ‘the least bad’ tax

The new excise tax on stock buybacks will satisfy Sinema while not alienating business — at least too much.

www.politico.com

“I hate stock buybacks,” Senate Majority Leader Chuck Schumer (D-N.Y.) said Friday. “I think they’re one of the most self-serving things that corporate America does. Instead of investing in workers and in training and in research and in equipment, they simply — they don’t do a thing to make their company better and they artificially raise the stock price by just reducing the number of shares.”

 

[BirdinHand]

Warren Buffett, in his letter, should issue a masterclass on how the economy works.

An “Economics 101” class teaches us about the multiplier effect — every time there is an increase in spending, it produces an increase in national income and consumption greater than the initial amount spent.

Stock buybacks are an excellent example of this effect at work. As shares are repurchased, the cash is used in a productive manner that benefits many Americans, from both the reinvestment of the proceeds or the spending of the distribution of the proceeds.

Here's why Sens. Schumer and Sanders are wrong on stock buybacks

Two U.S. senators criticized $4 trillion of share buybacks completed from 2008 to 2017. It is important to understand that this very large amount of cash did not vaporize, nor did it benefit just a small handful of people. Rather, it was used to positively impact the U.S. economy overall.

www.cnbc.com

Democrats go with ‘the least bad’ tax

The new excise tax on stock buybacks will satisfy Sinema while not alienating business — at least too much.

www.politico.com

No one is ending their ability to do stock buybacks.
Biden asked them not to do them for 1 year.

They get to keep 99% of the “upside” even if they say “no” and do them anyway. Uncle Sam takes 1% - and some want that number to go to 4%.

I’m sorry if you’re upset they’ll only get to keep 99 or 96% of money basically created out of thin air. Seems a rather silly complaint for the average person to make. Buffet, obviously, doesn’t want to be losing even 1% - but, he’s also worried about stock investors, not running the country.

Biden is recognizing that too many companies doing stock buybacks can be really bad if the economy has a hiccup. All of a sudden, they’ll start looking at their fixed costs - and the next thing you know, you have layoffs, etc.

Those aren’t necessarily bad for a company - but their bad for people in a country.

Warren even at his advanced age has time to educate people from the financially illiterate - Biden, Sanders, Warren.

Biden, even at HIS advanced age - is showing very clearly that he’s not running a business, he’s running a country.

Something perhaps you forget.

 

[Xanderman]

Stock buybacks artificially inflate the price of the stock, you do realize this right?

When Elon Musk sells $4 billion in Tesla stock at $300 per share, and the share price drops 10% as a result... he can then turn around and buy even more stocks with that same $4 billion at $270/ share. When he does that the price of the stock suddenly jumps again. It is manipulation that is really easy to do with the uber wealthy especially those with experience.

 

[Ahlevah]

Stock buybacks artificially inflate the price of the stock, you do realize this right?

When Elon Musk sells $4 billion in Tesla stock at $300 per share, and the share price drops 10% as a result... he can then turn around and buy even more stocks with that same $4 billion at $270/ share. When he does that the price of the stock suddenly jumps again. It is manipulation that is really easy to do with the uber wealthy especially those with experience.

Well, not necessarily. Taking your stock price from $34.84 two years ago to ten cents and ultimately to $0.00 when your company declares bankruptcy because it borrowed money and invested earnings in stock buybacks instead of its business is never a good plan:

Bed Bath & Beyond made plenty of mistakes that led to this week’s bankruptcy filing. Among the most consequential was the $11.8 billion it has spent since 2004 to buy back its own shares.
The company’s repurchase program wasn’t unique. But for a cash-starved business that announced it would likely be forced to close all of its stores if it couldn’t find an 11th-hour savior to buy it, the money could have been better spent.

Bed Bath & Beyond made plenty of mistakes that led to this week’s bankruptcy filing. Among the most consequential was the $11.8 billion it has spent since 2004 to buy back its own shares.
The company’s repurchase program wasn’t unique. But for a cash-starved business that announced it would likely be forced to close all of its stores if it couldn’t find an 11th-hour savior to buy it, the money could have been better spent. Instead, it fueled a desperate and ultimately failed effort to support its stock price.

https://www.cnn.com/2023/04/25/business/bed-bath-beyond-share-repurchases/index.html

Another example is Viacom, now Paramount Global after it recombined with CBS. That story also didn't have a happy ending:

From 2011-15 Viacom spent $15 billion in stock buybacks at about $61 per share, while the stock was trading for $44 on Thursday. That money would have been better spent on mergers and acquisitions and digital initiatives, says National Amusements.

Viacom Controlling Company Slams CEO Philippe Dauman After Earnings

In the statement issued Thursday, National Amusements lists specific ways Viacom has failed.

www.hollywoodreporter.com

Oops :

"Given the exceedingly poor performance of Viacom over the past several years on an absolute basis, and even looking relative to your peers...wondering if you can give us color on why you were the board's choice to be both Chairman and CEO?" Greenfield asked about halfway through the earnings call.

Dauman challenged the pointed criticism, arguing that Viacom beat the S&P 500 from 2009-2013, but attributed the putrid performance of the last two-plus years -- down 14% in 2014, 45% in 2015 and another 14% so far this year -- to "a lot of the noise that existed around us."

Viacom's Dauman, Under Fire, Blames 'Naysayers' For Stock's Slide

A shaky earnings report fires up fresh concerns about Viacom's direction.

www.forbes.com

Correct me if I'm wrong, but this isn't exactly an example of a bullish stock chart. Follow the blue line:



Ultimately, the man who engineered this debacle, Viacom CEO Philippe Dauman, was fired after a lengthy boardroom and legal battle with the company's controlling shareholder, Sumner Redstone's National Amusements. This company is mired in tens of billions of dollars in debt thanks to Dauman buybacks, slashed its dividend, and is expected to have negative cash flow for the coming year. Needless to say, it suspended its buyback program years ago even tough its stock has been a dog. It has more pressing issues, like figuring out how to juggle the $35 billion in total liabilities it has on its balance sheet in a rising interest rate environment, including $11 billion in liabilities due in 2023. My brokerage bestowed upon it a rare honor: its coveted "F" rating.

 

[Kushinator]

My understanding is “The Oracle of Omaha”supported Joe Biden for president. If he now characterizes Joe as an “economic illiterate” or a “silver-tongued demagogue,” what does that make Warren? Answer: a moron.

I get that people with limited critical thinking skills and a partisan axe to grind could come to such a conclusion.

 

[Ahlevah]

I get that people with limited critical thinking skills and a partisan axe to grind could come to such a conclusion.

One generally isn’t required to be an Einstein in order to make sense out of the mutterings of an imbecile.