> >
> >MBS
>
> Would be zero if they followed the advice of their tax lawyers. But lots of
> people don't optimally postpone capital gains liability. And for some
> peculiar reason corporations do continue to pay dividends rather than buy
> back their shares...
>
> Brad DeLong
Brad, you saying that a good investment for a profitable corporation can make
is to undilute profits by concentrating ownership. Or are you saying that the choice is between dividends and buying back shares. One could argue that dividends help insure the allegence of the diluted owners whereas buybacks will not necessarily.
The equivalent massive buybacks is to say that business managers are incapable of investing profits in their business. They amount to a transfer of profits to rentiers, propaganda aside not a investment astute class. If someone as economically naive as myself sees this, (I never took an economics course in my life although once upon a time I read 1/2 of P. Samuleson's text which I regarded as the equivalent of "Economics for Dummies"), this must be an ideological problem. While ideological contradictions are tolerated in the interests of profits sufficiently eggregious ones do cause eventual difficulties.
--mike -- Michael Cohen mike at cns.bu.edu Work: 677 Beacon, Street, Rm313 Boston, Mass 02115 Home: 25 Stearns Rd, #3 Brookline, Mass 02146 Tel-Work: 617-353-9484 Tel-Home:617-734-8828 Tel-FAX:617-353-7755