Economics
Goldman Rips Into U.S. ‘Misconceptions’ About Share Buybacks
- Incentive compensation doesn’t drive repurchases, Kostin says
- Politicians have been criticizing the practice as unfair
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Buybacks have gotten an unfair rap in the U.S., according to a defense of the practice by Goldman Sachs Group Inc.
U.S. companies have “consistently” returned cash to shareholders for almost 140 years, so it’s far from a new development, strategists led by David Kostin wrote in a note Thursday. And buybacks don’t dominate corporate spending, they said -- growth investment has been the largest share of U.S. companies’ spending every year since at least 1990.