The 4 biggest airlines, Delta, American, Southwest and United collectively spent $39 billion on share buybacks
to enrich their executive team – to date. These executives took massive bonuses even if their particular stock was underperforming in the industry.
Now these executives have squandered over 97% of all the monies they had on share buybacks and they want the taxpayer to bail them out.
This is exactly why I am against share buybacks.
I have expounded at length on why we had to do away with share buy backs at countless meetings – this shows exactly why.
This is $39 billion that could have been used to save these companies from another bailout. Instead it was used for no reasonable economic purpose. The chief motivation was to ensure executive bonuses and keep shareholders happy.
In my opinion, the executives of these companies should sell the assets they now personally hold – as a result of the options they cashed in on – from share buybacks & then (and only then) should the American taxpayer consider a bailout.
These companies had a chance to build up cash reserves on behalf of the companies they are supposed to be responsible for – instead they blew it on share buybacks. Airline executives are well aware that airlines are one of the hardest hit industries in a Recession but executives were overcome by greed instead of business prudence.
(This is why share buy backs are much more restricted in other countries).
Perhaps we taxpayers, now on the hook for this bailout, should take over the 4 airlines and fire the management teams
of these companies.
I wrote an opinion letter to our State Senators today and encourage you to do the same. Nationally, we now have $23 trillion in debt and after this crisis I am sure we will get to $26 trillion. If we see high interest rates – there will be no money to pay for any government services except the debt.
Tell the airline executives they must set personal examples before we as taxpayers bail them out. Please forward this email to as many outraged taxpayers are possible.
My biggest worry right now is that the corona virus is possibly mutating into a stronger virus that can also have dire consequence for younger healthier people and not simply the older people with pre-existing conditions.
We are seeing reports coming out of France and Italy reflecting that some younger people are getting seriously ill and that was rarely the case in China where the virus originated
a few months ago.
In no way am I stating that the disease is mutating but for now – it has to be the highest concern. Please forward this email to others
– as we must all work together.
Finally, since Friday I have heard money manager
after money manager stating the reasons they are buying heavily in the stock
If you followed their advice you would be getting killed and your wealth eroding away.
There is a reason why 96.7% of money managers underperform the market index!
I remain convinced of what I have said many times publicly,
“Money managers are the most overpaid, undertalented, class of workers in the marketplace”.
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