Will Stock Buybacks Cause the Demise of Capitalism?
8 Pages Posted: 16 Oct 2019
Date Written: October 6, 2019
Like previous economic systems, the capitalist system may be exposed to built-in mechanisms leading to its demise. One serious candidate to ruin capitalism is the practice of companies repurchasing their own shares. In this paper we extend the famous Warren Buffet analogy on CEO Fred Futile to show how unconstrained share buybacks could cause the demise of capitalism.
Keywords: Buybacks; Capitalism; Warren Buffett; Financial Markets
JEL Classification: G30, G35, B24, O16
Suggested Citation: Suggested Citation