, Columnist
Goldman’s Buyback Doom Scenario Is Overdone
Curbing share repurchases wouldn’t be a catastrophe.
No need for a disaster warning.
Photographer: Armend Nimani/AFP/Getty Images
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None other than Goldman Sachs is warning that the stock market would be in dire straits without buybacks. But it appears to take its doomsday scenario a little too far.
Late last week, Goldman’s strategists, lead by David Kostin, released a report saying that a lot of clients are asking about what would happen if Washington banned, or limited, companies from repurchasing their own shares. Goldman’s response: “Without company buybacks, demand for shares would fall dramatically.”