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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Fred Fahmy who wrote (73413)	1/12/2000 11:52:00 PM
From: Greg Jung	Read Replies (1) \| Respond to of 132070

Fred, the cash is spent. For every .40 of earnings .30 is spent in the buyback (or thereabouts, principally in latest years). Bottom line, only .10 goes towards increase in value. The other 0.30 went away! Its gone, not invested, no value is realized by the stockholder. This seems so simple from the cash flow, yet so embarrasingly bad that I must be wrong somewhere. In the case of microsoft, they don't buy much back and if they did (buy enough to keep share count constant) they would have net negative cash flow. So Intel really is earning a lot of money, which is used principally to compensate with stock the directors and employees (insofar as a particular employee class gets compensated with stock/options). Where does the shareholder stand in the food chain? (Hint: not at the front).