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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Fun-da-Mental#1 who wrote (35118)	12/13/1999 6:15:00 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 99985

Fun, not to forget that the stock buy backs are done to the detriment of balance sheets. in '98 corporate America used 125% of reported earnings to buy back stock. it is highly questionable if buying back extremely inflated stocks on credit is actually to the long term benefit of shareholders. simply put, it's fine as long as the bubble inflates further, but will be viewed as detrimental once it pops. at current prices companies should issue shares, not redeem them. clearly, equity capital is a lot cheaper than debt at this point in time. regards, hb

To: Fun-da-Mental#1 who wrote (35118)	12/13/1999 8:20:00 PM
From: Jack T. Pearson	Read Replies (1) \| Respond to of 99985

Dear Fun, In periods of high growth in new markets, I would question the competence of any management team that gave any priority to dividends over market share and product development. As for stock buybacks, it makes sense if you have confidence that the company will do well and that the stock is undervalued at current prices. If you check the companies that have bought back stock, I think you will find that most of them did the smart thing. Look back about five years at the stock buyback plans of IBM, Microsoft, and Dell. Jack