good old American optimism

[Rakesh Bhandari]

> errrr.... knope?  For one thing, equity is expensive at the time when you
> issue it, but after this, the cash cost is merely the dividend yield (and
> dividends can be skipped).  Second, gearing up increases your cost of
> equity (or at least, it always used to).  Third, your point would make more
> sense if companies could buy back equity at the same price at which they
> issued it -- but they actually buy it back at the prevailing market price.

But Daniel for those left with shares, their return goes up due to the tax
advantages from deducting interest on debt used for buy back. Or something
like that? Right...
Yours, Rakesh