Age of prudence

The above chart shows the number of companies in the S&P index that announced share buybacks in the last 3 years, marked in red or blue depending on whether their earnings (as measured by EPS) was shrinking or growing.
As the saying goes - a picture is worth thousand words. So in this post, I'll save those thousand words for another day, and just leave the reader to draw their conclusions on how financial engineering took over our world. It is telling that even with buybacks, so many companies' EPS was on a downtrend.

PS: Running one of the largest Share Repurchase programs in the industry is my day job, and I'd be the first to say that share buybacks should be an important part of a company's business model and tool for managing capital structure. However, the operative word is "part" - when allowed to run amok like it was in the past few years, it is a colossal waste of shareholder wealth.