Nick Hanauer, an entrepreneur, venture capitalist, billionaire and writer, makes a case in this article in The Atlantic that share repurchases by large companies – issuer bids under Canadian parlance – have drained money from the real economy and have inflated share prices and earnings per share, while providing no positive impact on the overall economy. He cites a paper, which calls shareholder value maximization “The World’s Dumbest Idea,” that attempts to show how share repurchases reduce business investment and increase inequality. Whether there is any reality to this claim is in dispute (e.g., here, and here), but the debate is a fascinating one. Our regulatory regime addresses fair treatment of shareholders but has little to say about the overall positive or negative impact of buyback for society. An interesting (if true) statistic noted in the article is that since the 1980s, public companies have spent more to buy shares back than they have received from new issues - “[s]hareholders aren’t providing capital to the corporate sector, they’re extracting it.” The comments on this article are quite numerous (over 1200!) and provide some fascinating reading themselves.