[mishkinf]

It is a short term injection of value into stocks. This clearly can be abused. That money which could have been used to invest in, oh say hiring more Americans or paying employees better wages, or infrastructure, or anything with long-term value generation is rather diverted and put into stocks, which is a short term appreciation. The vast majority of stock is owned by the the very wealthy and many people at the bottom have next to zero or zero stock ownership. This obviously is a threat to a balanced society and the reduction of inequality. If a company wants to increase its stock value, why not invest the money it has into long-term growth investments rather than driving up the stocks?

The decision to perform stock buy-backs could be an indication of the general pessimism that corporations have about the economy. If consumer debt is at an all time hight, how can we find more people to buy the products we are making? We tried giving people more debt than they could handle (mortgages) and that ended in spectacular disaster in 2008. So maybe the only thing corporations can do to increase value is to rely on buying back stocks! Makes a lot of money for some people..