Stock Market Time Bomb

Buybacks and options: a lethal duo

To put it mildly, stock buybacks are on a roll. Before the mid-1980s, they were on hardly anyone's radar screen. Yet last year, nonbank S&P 500 companies shelled out nearly $150 billion to repurchase their own shares, a stunning $35 billion more than they paid in dividends. What's behind this boom?

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