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Bouncy Bouncy- 11/7/22

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from a 2014 article:
 

„Companies have been allowed to repurchase their shares on the open market with virtually no regulatory limits since 1982, when the SEC instituted Rule 10b-18 of the Securities Exchange Act. Under the rule, a corporation’s board of directors can authorize senior executives to repurchase up to a certain dollar amount of stock over a specified or open-ended period of time, and the company must publicly announce the buyback program. After that, management can buy a large number of the company’s shares on any given business day without fear that the SEC will charge it with stock-price manipulation—provided, among other things, that the amount does not exceed a “safe harbor” of 25% of the previous four weeks’ average daily trading volume. The SEC requires companies to report total quarterly repurchases but not daily ones, meaning that it cannot determine whether a company has breached the 25% limit without a special investigation. 
 

Despite the escalation in buybacks over the past three decades, the SEC has only rarely launched proceedings against a company for using them to manipulate its stock price. And even within the 25% limit, companies can still make huge purchases: Exxon Mobil, by far the biggest stock repurchaser from 2003 to 2012, can buy back about $300 million worth of shares a day, and Apple up to $1.5 billion a day. In essence, Rule 10b-18 legalized stock market manipulation through open-market repurchases.“

https://hbr.org/2014/09/profits-without-prosperity

Basically it is all the outcome of the Reagan era „de-regulation“ politics or better call it „mantra“. Most of it is still in place and was never rolled back.

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THE CAT NEEDS TO SLEEP

The FED should be conducting a Quantitative Null policy...the pause....and not distorting the market.

Anything else is simple interference in asset markets.

Its still enough for the market to still go down....

Then the focus would shift from blaming the FED to blaming the US govt defecit.

Something I think the FED would welcome. 

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