Being anti stocks/wallstreet/corporations is very trendy so attacking concepts is easy. Most people don't understand dividends let alone buybacks, so attacking things like this are cheap pops (to steal a wrestling term.) There is nothing wrong with buybacks and dividends. Elizabeth Warren wants every company that receives support during this time to be permanently barred from dividends and buybacks. JFC. I don't think they should use bailout money for those purposes, but in a normal economic situation if they are thriving, those things are good. They boost stocks, help our cash, etc.
A good point... the automobile industry bailout was largely loans that the auto companies paid back. If these financial aid packages are also handles as loans then they seem reasonable as a way to keep people employed. But I'd also think conditions like "no stock buy backs for x years would be reasonable... and even guidelines on executive compensation.
I am approaching it from two different positions, Keynesian vs Austrian ... and what is truly being bailed out. Chrystal and GM had been pushing out crap for the last couple decades while other car manufactures (globally) did a much better job at innovating. The banking sector is much more dicey, I will admit that. That said, we shouldn't be bailing anyone out just to get a vote. And yes, I believe that was a significant driving factor in all of the 2008 bailout. Is it a big surprise big money is throwing full support behind the Democrats now? I do think we should help those who are in need right now. I just dont think we should be giving big checks to the middle class only, especially to those who are still employed. But like everyone else, I will still take that $1200 check regardless.
I agree - and those bank bailouts placed similar restrictions (which served as an incentive to pay the taxpayers back). I believe the auto bailouts gave partial ownership of the companies to the unions/employees. I think any corporate bailouts should have similar things this time - but it seems that's the case to some degree in the initial legislation. Most business stuff is in the form of loans, not grants. Puts pretty severe restrictions on compensation and an still vague right of the government to share in profits. And that was the GOP proposal so you know it will get more restrictive once it becomes bipartisan.
Eh - big business didn't support Dems in 2012. 2016 was more of a "Trump creates chaos thing" than anything else. 2020 big business is generally staying out of it so far - there's chaos, but business also got a massive tax cut. And TARP was led by the Bush Administration. The current bailout is pretty bipartisan this time around.
While partisan debate over who, where and how the money gets doled out, here is a quiet part of the debate...
Yeah, of course there should be nothing wrong with buybacks. It's supposed to be capitalism here. But you as a company should eat the risk. But they won't and they know they won't because their industry, like the banks, know they're considered "essential." But it's even more complicated than you suppose (monetary policy has encouraged this off-the-charts speculation that has fuelled the buybacks because the Fed has created a monster in that it has shown it will backstop basically everything). The problem is asking the taxpayer to bail you out because your industry is "essential" to the economy (which it is). They spent their cash on buybacks, now the amount of money they are asking for is essentially equal to the buybacks the last five years. So in effect moral hazard abounds, and it is corporate socialism period. A total load of crap and essentially destroys the heart of capitalism.
Have you ever run a business? I have for years and I some your post misguided and false. Sorry, not trying to personally attack you, but I take issue with it. I have never engaged in risk-taking because I know that my industry is not considered "essential" (eg, airlines or banks). I conserve profits because of times like these, because I know I won't get bailed out if I engage in risky behavior (eg, stock speculation, buybacks). As well, you mention "sitting" on billions of dollars in profits - uhh, whatever happened to capital re-investment and production investment? You know, the things that lead to more job creation? Stock buybacks do not create jobs, they create more wealth for those well-invested. They are doing it because it's so easy when current monetary policy has virtually guaranteed that the shareholder will not lose. Load of crap. It essentially has destroyed the foundation of capitalism. These companies need cash? Why don't they sell their stock? Because it would be at a loss? Too bad. When your industry is going to be backstopped by the Fed/government, this type of crony, corporate socialism allows these companies to engage risky behavior. A total load of crap. You want the loan? Simple, agree to a permanent ban on buybacks. Don't want to agree? Then don't take it. No one is forcing them to take the money.
Uhh, these companies already do that. No company invests every dime of their profits in perpetuity - if they did, owners would never get a return. Airlines having invested a bunch more money into infrastructure or jobs would just mean their ongoing expenses are even higher now and they need even more funds. This is a revenue problem, not a "companies made poor decisions" or "they should have invested more" problem. ... and this is what the airlines and other companies did. They conserved profits instead of just spending all excess on "capital re-investment and production investment". Since they are a corporation and not a small business, they distributed those conserved profits to the people who own the company instead of just sitting on other people's money endlessly - something we all complain about as well. I suspect if you own your own business, you don't endlessly leave money in it either - you take it out as the owner. Corporations are the same - they are designed to distribute profits rather than hold onto them. Stock buybacks are a way of distributing profits, just like dividends. it's no more "risky behavior" than any other method of distributing profit. It's just are a different mechanism. You don't sound like you understand business at all.
[Premium Post] Democrats are depriving Americans of much-needed relief by holding up a stimulus bill because they want money for their solar panel and airplane emissions fantasies. Utterly shameful. James Clyburn, a very low IQ individual, views this as a "tremendous opportunity to restructure things to fit our vision". Doesn't sound like a man seeking to meet the urgent needs of the moment. Sounds like an ultra-partisan who wants to win longstanding political battles instead of putting out the fire. Democrats represent the working man? Not anymore... they represent their special interests in environmental fantasy lala land. SHAME
They want GREEN NEW DEAL? This is because they want the economy to collapse and for people to vote democrat. They are ignoring that the people are all home watching THEM hold up the money and aid people need.
I run a business as well, but let's not pretend that running a "business" is the same as running mega corporations that are publicly traded and make up huge portions of our economy. "Don't want to agree? Then don't take it." Great, let them go out of business and destroy the economy.
Yeah Yeah Yeah... Democrats Democrats Democrats ... Same BS.. Different day... Now go back under your rock until tomorrow..... T_Man
Did you read or watch the news? He's not wrong and I want my Dem/Lib friends to explain to me why this is okay?
Yeah I did... did you!!! I believe it was @AroundTheWorld who said Mitch was going to do this.... He called it correctly!!! Mitch is full of BS and is trying to pass a Bill that will help his Billionaire friends and Mnuchin... So he gets on his high and mighty platform and goes on and tries to use the Dems don't care about America... I CALL BULL S _ _ T!!!! and so did Pelosi.. I said this in another thread and I will say it here... If Mitch is serious then take out the BS money for slush fund and the big corporations... If the Dems have BS in there, they should take it out also... 3 sides to a story... left side, right side and the truth... This situation is about the PEOPLE and not about big CORPORATIONS!!! They've all had a bail out and now it's time for the people to have theirs.... This is coming from an Independent... T_Man
Seems like a decent bill to me, go ahead and pass it then push another thru if need be. I especially like the part about shoring up unemployment insurance. Senate coronavirus stimulus package: What’s in it "The package would provide direct financial help to Americans in the form of stimulus checks sent out to many Americans. The proposal would include a one-time payment of $1,200 per adult, $2,400 per couple in the U.S. and up to $3,000 for a family of four. Republicans have called for minimum payments of $600 to Americans, and aid would be phased down at income thresholds of $75,000 for individuals and $150,000 per couple. Additionally, there would be $500 payments for each child. It would establish new and much more generous unemployment benefits by adding $600 per week to normal state benefits for up to four months and provides an additional 13 weeks of benefits to 39 weeks of regular unemployment insurance through the end of 2020 if they are sidelined by the outbreak. The coverage would be retroactive to Jan. 27 and coverage would be extended to "gig" workers and independent contractors." https://www.foxnews.com/politics/senate-coronavirus-stimulus-package-whats-in-it
