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View Diary: The Stock Market is Not Crazy and the Republicans are Toast (210 comments)

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  •  Come on (0+ / 0-)
    In fact, corporations are making use of low interest rates to buy debt in order to pay for these dividends.  Apple's mega-sale of bonds is just the most recent example of this.
    You do understand, right, that what Apple is doing is borrowing $17b against its assets of $145b so as not to take a significant tax loss for sending out those dividends, right?

    I'm not quite sure how this is a bad thing, except in the generic 'no goddamn American companies pay taxes' kind of way. And honestly, it's also not terribly common. In fact, I suspect that (no google-cheating, now!) you can't name another company that has done it in the last year. And that the first three that you find via google will be doing it for the same reason: good cash flow and good profits, but for one reason or another they don't want to commit their cash right at the moment.

    •  Seriously? (5+ / 0-)

      First, yes is obviously is a bad thing that American corporations are shuttling revenues overseas to avoid taxes.  Yes it is a bad thing that they can take advantage of ridiculously low interest rates to raise money to then funnel it to their wealthy investors.  And that amidst all this continues the austerity agenda and the suffering of the American people.  The effective tax rate paid by corporations as a whole is at the lowest level on record and it's doing no favors to our social safety net.

      Second, that "they don't want to commit their cash" was precisely my point.  They aren't investing into the American economy, they are sitting on cash rather than make capital investments that would generate economic growth broadly felt by the American people.  Instead, they convert their cash into dividends felt by their stockholders.  QE isn't doing jack s*** for the economy despite its nominal purpose to "create jobs."

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