Stock buybacks used to be illegal in the States up until 1982. You can thank Raegan for that too.
This is not true, but seems to come up a lot. I guess it makes for one of those fun "internet facts" that people like to repeat without any investigation. Bonus points for blaming Reagan.
Stock buybacks were not illegal before 1982. If you sit down even think through it, it doesn't even make sense they were illegal. Just like issuing new shares (or doing a stock split), companies have legitimate business needs to buy back stock (reduce the quantity of outstanding shares).
What happened in 1982 was that the government made Rule 10b-18, which outlined the "safe harbor" requirements for stock buybacks, where if followed, the company could not be found liable for stock manipulation.
https://www.skadden.com/-/media/files/publications/2020/03/t...
So stock buy backs were legal before 1982, but companies faced a risk of stock manipulation if they were reckless in how they did it.
Sounds like a much better state of affairs.
I think that's a good thing. I'd rather have it be clear to all parties what is acceptable and what isn't, rather that a murky legal framework where you never know if you're breaking the law.
Stock buybacks were legal and happened before 1982.
The “thanks Reagan indeed” is just your own internal biases. The President didn’t draft the law and the Democratic Congress passed it.
So quite odd to blame a single person.
It should be a warning against believing things on the internet because they conform to your biases. Check your sources.
And you keep acting like the 1982 law had no effect when it made the largely marginalized practice of stock buybacks mainstream. Maybe you should check your biases.
https://corpgov.law.harvard.edu/2020/10/23/the-dangers-of-bu...
https://crsreports.congress.gov/product/pdf/LSB/LSB10266
https://www.vox.com/2018/8/2/17639762/stock-buybacks-tax-cut...
https://www.sciencedirect.com/science/article/abs/pii/S01651...