Stock Buybacks

Stock buybacks have been in the news recently as Bernie Sanders and Chuck Schumer proposed that a company should only be allowed to buy back its own stock if certain conditions were met, such as an employee wage of $15 per hour. And today, Marco Rubio announced he would propose a tax on buybacks that would be similar to the tax on dividends for investors. Of course, as these suggestions have come from politicians, they may have a misunderstanding about stock repurchases. A recent CNBC video discusses some of these misconceptions.