Deficient government policy results in companies suboptimizing

by YankeeJim | October 7, 2010 at 02:41 am

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When companies should be in fresh pursuit of green energy, green production, green consumer products, they are propping up their financial position in themselves. They are doing this arguably because the government hasn’t afforded them sufficient incentive to take risks on becoming best at what’s new – new product and new business unit development.

This omission in strategy and incentive must be fixed at once so that the nation’s economy can pick up steam.

http://www.washingtonpost.com/wp-dyn/content/article/2010/10/06/AR2010100606772.html?wpisrc=nl_headline

“U.S. companies buy back stock in droves as they hold record levels of cash

By Jia Lynn Yang

Washington Post Staff Writer
Thursday, October 7, 2010; 12:04 AM

For months, companies have been sitting on the sidelines with record piles of cash, too nervous to spend. Now they're starting to deploy some of that money - not to hire workers or build factories, but to prop up their share prices.

This Story

U.S. companies buy back stock in droves as they hold record levels of cash

Poll: Are corporate buybacks a good business strategy?

Sitting on these unprecedented levels of cash, U.S. companies are buying back their own stock in droves. So far this year, firms have announced they will purchase $273 billion of their own shares, more than five times as much compared with this time last year, according to Birinyi Associates, a stock market research firm. But the rise in buybacks signals that many companies are still hesitant to spend their cash on the job-generating activities that could produce economic growth.”