Stock Buybacks: The C-Suite’s Form Of Margin Speculation

In 2018, it’s no secret that this market runs on leverage and borrowing. And although the percentage of NYSE margin debt compared to the total stock market capitalization of the Wilshire 5000 is not at the all-time high seen in 2007 (2.5 percent), it sits just a tad below, at 2.2 percent……Instead, this time around, it’s the U.S. nonfinancial corporate sector that boosted its debt outstanding to a record of $13.7 trillion. And it is using part of it for buying its own stocks on margin, although it is called by a different name this time: “share buybacks.”