One of the main problems I see with modern Corporatism is that "shareholders" have too much influence over companies, driving them to make choices that erode long-term customer trust and brand value in return for short-term gains. (This is rational from the investor POV, because they can sell their stake at any point and still have made a profit on the dead husk of a company they left behind). Put more briefly, being beholden to shareholders drives enshittification.
Stock buybacks should, in principal, allow a company to dilute shareholder power and re-control its own destiny. It should allow a company that is successful enough to not need external investment anymore to re-prioritize what's good for the company, rather than the shareholders, especially once they've reached the point of having enough free cash to not need investors. Why, then, is it so universally reviled?
I think what I've heard is: The buyback is part of a larger scheme where execs / board members can pump the price of the stock, and then make themselves money either through bonuses tied to rising stock prices, or through dumping their own shares once the market price goes up.
The vibe is that there's a vicious cycle of "Customers are not brand-loyal, let's make our products shitty, hollow out the brand, and then liquidate everything to enrich ourselves" and "Why should I be loyal to any brand when brands that were institutions in my parents' time, like Sears and Craftsman, are hollowing out their brands and making everything shitty for a quick buck?"
Feels like everything has become a market for lemons, and the hand of Moloch has realized that if something isn't a market for lemons, it would be more profitable if it was.
In my head there's a piece of red string connecting this to the Internet Whalefall phenomenon - The Internet used to feel like (again, vibes are all I have for this) a place where the savvy early-adopter techie could be rewarded for their skill at installing any web browser but IE, with secret information shared by other elite techies, about which brands were good and how to get things done cheaper.
But now that Eternal September post-2007 has Pokemon-mega-evolved into Eternal 2007, everyone just buys reviews and nothing online is trustworthy. All the whale meat is eaten and those picking at the bones are left starving.
This led to my personal heuristic of just taking recommendations from people or orgs I meet in person. "Do you like that brand of clothing? How is that USB hub treating you? Where did you buy this?" It's a natural hedge against "I could have _told_ you not to buy that piece of crap" and it's also mathematically similar to best-of-two-random-choices load balancing. Just pick any service or product that one real human halfway-likes.
I think this "lemonade stand" effect is where a lot of companies are staying privately funded as opposed to ever going IPO... it's such a slippery slope to the bottom in that you lose control over doing what you feel is best for the company (or society) in favor of maximizing shareholder value.
Even personal recommendations have the problem of requiring significant use time (c. a year?) to estimate value. A company can (it seems) degrade quality for a model faster than quality can be evaluated by normal use.
Shareholders own the company. They are literally the owners of the company. Like anything you own.
In the same way you own your house and pay a painter to paint it, the shareholders own the company and pay Nick to stamp boxes.
I don't know of anyone who has had work done on their home, and then upon selling the home, went back to the painter and said "Here is your cut of the profit we made selling our house, thanks for the great work!"
But I know and endless number of people who think that because they painted a house at an agreed price to make it look nice, they need to be cut in on the profit from selling the house.
Now, this painter works for your house exclusively every day 40 to 60 hours each week total, 2-5 years, and because of their work you sell house for 1,000x of the original price. You now go to live luxury life without need to ever work again, while painter continue their meager life painting another house 8 hours every day.
I would say that is a pretty dumb painter. Definitely wildly talented at painting, but incredibly unintelligent. Just paint the house like you were paid to.
You might think I was making an analogy, and hence tried to break it, but it wasn't an analogy. Its the same thing. You own something, you pay people to work on it, it's still all yours afterwards.
Those with a 1000x return almost universally recognize that they have the talent to not work for someone else. Or they do work for someone else, but make far, far, more than a house painter to do it.
Those are probably less than 1% of the population. The majority don't even approach 2x, much less 1000x.
The stock does not carry voting rights and for good reason management could effectively vote itself more power and entrench control. There are many laws in place to prevent this.
One of the main problems I see with modern Corporatism is that "shareholders" have too much influence over companies, driving them to make choices that erode long-term customer trust and brand value in return for short-term gains. (This is rational from the investor POV, because they can sell their stake at any point and still have made a profit on the dead husk of a company they left behind). Put more briefly, being beholden to shareholders drives enshittification.
Stock buybacks should, in principal, allow a company to dilute shareholder power and re-control its own destiny. It should allow a company that is successful enough to not need external investment anymore to re-prioritize what's good for the company, rather than the shareholders, especially once they've reached the point of having enough free cash to not need investors. Why, then, is it so universally reviled?