good old American optimism

Jordan Hayes jmhayes at
Mon Apr 3 15:49:41 PDT 2000

From dhenwood at Mon Apr 3 15:43:49 2000

Firms are now borrowing to sustain their buyback programs.

That sounds bad, but is it really? Ok, so it's not 100% for retiring float, but plenty of it is. Interest rates are at historical lows and corporate bond issues are plentiful: why *not* swap locked-in low rates in order to fund buybacks? Companies sold equity to raise cash, for some companies it's the most expensive financing they've ever had access to.

Isn't it just like an individual who swaps their 21.6% Visa for a 3.9% no-interest-for-6-months MasterCard?


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