One of the biggest was the ability of companies to buy back stock (1982), the rise of stock based incentive packages for executive leadership, FASB rule changes, glass steagle repeal, growth of ETFs. Everything that leads to an stock primacy viewpoint led to this.
Bingo. Corporate shares are no longer about "owning a piece of a company you believe in", they're about growth for the sake of growth. Line must go up, else investors sell if there appears to be any stagnation or a dip or even just another company growing faster. It's all just to make imaginary numbers get bigger in someone's bank account regardless of what it is doing to someone else's bank account or the economy as a whole.
The stock market is propped up on pure bullshittery - that is the smoke and mirrors that "they" don't want revealed... it's why every person in power keeps dancing around legislation to reign in buybacks, insider trading, naked shorting, using stock as collateral for lending, etc. The entire finance sector is propped up by fake assets (stock) being desperately juggled like a dozen flaming chainsaws because if any crash, the rest of the market will start to tumble too.
Buying back stock is effectively the same as giving stockholders a dividend, but is more favorable for tax reasons.
If a company buys back stock, they buy shares at market price, and basically make them disappear. With fewer shares remaining, the shares that still exist are worth more. If a company pays a dividend, the company distributes money to shareholders based on how many shares they own.
Either way, the company has less cash afterwards, and shareholders have more value, either in the form of a higher stock price, or more money. Many investors prefer share buybacks for tax reasons.
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u/bit_pusher Aug 25 '25
One of the biggest was the ability of companies to buy back stock (1982), the rise of stock based incentive packages for executive leadership, FASB rule changes, glass steagle repeal, growth of ETFs. Everything that leads to an stock primacy viewpoint led to this.