Reasons for Ban:
New York Times:
Corporate stock buyback is an enormous problem for workers and for the long-term strength of the economy for two main reasons.
First, stock buybacks don’t benefit the vast majority of Americans. That’s because large stockholders tend to be wealthier. Nearly 85 percent of all stocks owned by Americans belong to the wealthiest 10 percent of households. Of course, many corporate executives are compensated through stock-based pay. So when a company buys back its stock, boosting its value, the benefits go overwhelmingly to shareholders and executives, not workers.
Second, when corporations direct resources to buy back shares on this scale, they restrain their capacity to reinvest profits more meaningfully in the company in terms of R&D, equipment, higher wages, paid medical leave, retirement benefits and worker retraining.
Reasons for not ban:
Market Wach:
First, a stock buyback is just a low-risk way of allocating capital for firms that are uncertain about the return on investment of higher wages and R&D. When firms earns excess profit, they don’t necessarily know what to do with the money. They can engage in high-risk allocations (like R&D, paying employees, etc) or they can engage in low-risk allocations (like dividends, buybacks. etc).
This doesn’t mean the firm doesn’t want to pay employees higher wages or invest in R&D. It just means the firm is performing well and it doesn’t want to take any unnecessary risks that might put the firm AND all of its employees at risk. This is prudent and better than sitting on the profits and doing nothing, or worse, investing it in employees and R&D, earning a negative ROI and risking the firm’s future.
Second, someone needs to destroy this idea that buybacks are necessarily incentivizing short-termism and manipulating the stock market. If these ideas were right, then buybacks would be bad for firms in the long term. And if buybacks were bad for firms in the long term, then their stocks would underperform in the long term.
But data show the opposite is true. Firms that buy back shares tend to outperform or at least match the S&P 500’s SPX, +0.66% performance over the long term. This makes sense because a critique of buybacks is really just a critique of firms for making excess profit.
Zero Hedge:
Goldman's David Kostin cautioned last week, without company buybacks, demand for shares would fall dramatically, for one simple reason: repurchases have consistently been the largest source of US equity demand. Since 2010, corporate demand for shares has far exceeded demand from all other investor categories combined. Net buybacks for all US equities averaged $420 billion annually during the past nine years. In contrast, during this period, average annual equity demand from households, mutual funds, pension funds, and foreign investors was less than $10 billion for each category – despite the fact these categories collectively own 83% of corporate equities. Buybacks represented the largest source of equity demand in 2018. This is shown in the table below.
Head of Goldman Sachs’ corporate trading desk Neal Kearns said the corporate bid tends to become more aggressive in a falling market as fundamental investors move to the sidelines. In periods of extreme dislocation, like we witnessed at the end of last year, repurchase activity can temporarily spike by multiples of average levels, as companies take advantage of attractive price points/valuations, and which may ultimately also have a secondary effect of tempering price volatility. That said, companies are cognizant of their trading footprints and generally aim to be less than 10% of trading volume.
民主党参议员Chuck Schumer和Bernie Sanders将试图对要求公司承诺在富裕的股东利益之前满足其工人和社区的需求立法进行投票。这基本上是试图禁止企业股票回购。
赞同禁止股票回购理由：
纽约时报：
由于两个主要原因，公司股票回购对工人和经济的长期力量来说是一个巨大的问题。
首先，股票回购并没有使绝大多数美国人受益。那是因为大股东往往更富裕。美国人拥有的所有股票中近85％属于最富有的10％的家庭。当然，许多企业高管通过股票薪酬获得补偿。因此，当一家公司回购股票，提升其价值时，股东和高管，而不是工人的利益绝大部分。
其次，当公司使用资源以这种规模回购股票时，他们限制了他们在研发，设备，更高工资，带薪病假，退休福利和工人再培训方面更有意义地将利润再投资于公司的能力。
反对禁止回购理由：
Market Watch：
首先，股票回购只是一种低风险的方式，为不确定高工资和研发投资回报的公司分配资金。当企业获得超额利润时，他们不一定知道如何处理这笔钱。他们可以从事高风险分配（如研发，支付员工等），也可以从事低风险分配（如股息，回购等）。
这并不意味着公司不想向员工支付更高的工资或投资研发。这只意味着公司表现良好，并且不希望承担任何可能使公司及其所有员工面临不必要的风险。这是谨慎而且比坐在利润上无所事事，或者更糟糕的是，将其投资于员工和研发，获得负面投资回报并冒着背负公司未来的风险。
其次，有人需要摒除这种观点，即回购必然会激励短期行为并操纵股市。如果这些想法是正确的，那么从长远来看，回购将对公司不利。如果长期回购对公司不利，那么它们的股票长期将会表现不佳。但数据显示情况恰恰相反。回购股票的公司往往表现优于或至少与标准普尔500指数的SPX相匹配，长期表现为+ 0.66％。这是有道理的，因为对回购的批评实际上只是批评企业获取超额利润。
ZeroHedge：
高盛的David Kostin上周告诫说，如果没有公司股票回购，对股票的需求将急剧下降，原因很简单：回购一直是美国股票需求的最大来源。自2010年以来，企业对股票的需求远远超过所有其他投资者类别的需求。在过去九年中，所有美国股票的净回购平均每年达到4200亿美元。相比之下，在此期间，每个投资类别类别，共同基金，养老基金和外国投资者的年均股权需求不到100亿美元 - 尽管这些类别共同拥有83％的公司股票。回购是2018年股票需求的最大来源。如下表所示。
高盛（Goldman Sachs）企业交易部门负责人尼尔·卡恩斯（Neal Kearns）表示，随着基本投资者走向观望，公司竞购在市场下滑时趋于变得更加激进。 在极度错位的时期，就像我们在去年年底见证的那样，回购活动可以暂时飙升平均水平的倍数，因为公司利用有吸引力的价格点/估值，并且最终票价格波动的次要影响。 也就是说，公司认识到他们的交易足迹，并且通常目标是不到交易量的10％。
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