[slg]

>There's no new money "injected". If he wants to buy a significant amount of stock, there will be some upward pressure on the price, because you have to find someone willing to sell, but that same condition applies to Apple. They have to buy on the open market just like Tim Cook. If a 100MM purchase is going to push up the market cap by 0.1%, it'll do the same for both.

The injected money (or I will admit more accurately injected value) comes from increased demand. The only effect of Tim Cook buying shares in increased demand for Apple stock. Meanwhile Apple buying shares will be coupled with a decrease in value of the company's assets. Tim Cook's purchase only provides upward pressure on the market cap. The buyback provides downward pressure as well.

>As for the buyback being important because it increases insider's ownership, no, it doesn't. At least not in any meaningful sense. There's maybe 1% held by "insiders". If Apple buys back 175 billion in stock at their current price/value (a terrible assumption, but whatever), they'll take 33% of the stock back. So the insiders will hold 2% instead if none of them sell.

Personally I would say doubling your ownership percentage is meaningful. But like I said earlier the whole thing relies on the insiders having $150 billion in stock + cash which they almost assuredly don't and likely can't raise. You keep on ignoring that condition. I am arguing a hypothetical situation in which they do have that money. You seem to be arguing that even the hypothetical is impossible because they don't have that money.

[dpark]

> The injected money (or I will admit more accurately injected value) comes from increased demand. The only effect of Tim Cook buying shares in increased demand for Apple stock. Meanwhile Apple buying shares will be coupled with a decrease in value of the company's assets. Tim Cook's purchase only provides upward pressure on the market cap. The buyback provides downward pressure as well.

Sure, the buyback applies some downward pressure on market cap in addition to the upward pressure. In theory it all evens out anyway. If cash is valued correctly by the market, then a buyback has no effect on price at all.

> Personally I would say doubling your ownership percentage is meaningful.

That was a mistake on my part. It's only a 50% increase, not a 100% increase.

> But like I said earlier the whole thing relies on the insiders having $150 billion in stock + cash which they almost assuredly don't and likely can't raise. You keep on ignoring that condition.

What you're ignoring is that the buyback is irrelevant if you assume Tim Cook has access to absurd amounts of loan money. If he can get hundreds of billions of dollars to buy Apple after a buyback he can certainly accomplish it before the buyback.

Frankly the initial "insider" status is also irrelevant. Tim Cook can spend 150 billion before the buyback for 33% of the stock or 150 billion after the buyback for 50% of the stock and the result is the same assuming the market values cash on hand correctly. He spends 150 billion and ends up with 50% of the smaller company.

You also keep saying 150 billion as if it's somehow sufficient to buy the company. It isn't. It isn't even close. If you assume the market cap will drop to 300 billion after the buyback, 150 billion gets you majority control. But to buy you need 300 billion plus a premium over the trade price so you don't get sued to death. So call it 360 billion total (20% premium). This is not much lower than simply buying Apple outright before the buyback for 600 billion (20% premium). Cancel out the cash and you're at 400 billion. So all you've done is erase the 20% premium from the cash on hand (which the market would presumably do for you anyway).

Or to put it another way, the buyback is irrelevant.