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Author: rationalwalk Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 214645  
Subject: Felix Salmon's weird article on buyback Date: 12/13/2012 7:41 AM
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Never let the facts get in the way of a pre established narrative (at least he's honest enough to admit mistakes at the end but the article still misses the point.)

http://seekingalpha.com/article/1060581-berkshire-s-weird-bu...
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Author: olehere Two stars, 250 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 196912 of 214645
Subject: Re: Felix Salmon's weird article on buyback Date: 12/13/2012 3:16 PM
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The announcement was made, and trading resumed, but there’s really no reason why the announcement couldn’t have been made ten minutes earlier, before the market opened.

At the same time he posts with x-edit sentences still in the article. In a rush to get something out there with his name on it that is ahead of everyone else. Who cares if the article is wrong or incomplete or still has x-edit sentences showing. "Hurry, Hurry, get it sent!"

I gotta go take a nap...

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Author: VUCommodore Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 196915 of 214645
Subject: Re: Felix Salmon's weird article on buyback Date: 12/13/2012 3:28 PM
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From the article:
"Buybacks are considered a good thing, on the stock market, for three reasons. Firstly, they reduce the number of shares outstanding, which means that the value of the remaining shares goes up: the company is worth the same amount, so the value per share is higher. "

Really? The company is worth the same amount? I guess WEB got to repurchase the shares for free!

This guy is clueless.

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Author: rationalwalk Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 196918 of 214645
Subject: Re: Felix Salmon's weird article on buyback Date: 12/13/2012 4:02 PM
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At the same time he posts with x-edit sentences still in the article. In a rush to get something out there with his name on it that is ahead of everyone else. Who cares if the article is wrong or incomplete or still has x-edit sentences showing. "Hurry, Hurry, get it sent!"

The economics of blogging is to get as many page view impressions as you possibly can. The way to do this is to get content out there as quickly as you possibly can which means as early in the news cycle as possible. The fact that the content may be full of errors or misleading isn't the point. That doesn't reduce the number of page view impressions or the advertising revenue in the least. At a later point, if called on by readers, they can issue weak mea culpas. Fact checking up front takes time and effort and would result in the article hitting search engines after the peak of the news cycle. This is not a priority for mass volume bloggers like Felix Salmon or sites like Seeking Alpha where editors most certainly do not fact check articles prior to publication.

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Author: mungofitch Big gold star, 5000 posts Top Favorite Fools Top Recommended Fools Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 196921 of 214645
Subject: Re: Felix Salmon's weird article on buyback Date: 12/13/2012 5:01 PM
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...the company is worth the same amount, so the value per share is higher.
...
Really? The company is worth the same amount? I guess WEB got to repurchase the shares for free!


The guy is indeed incorrect, on both counts.
Stock repurchases almost invariably cause the aggregate value of any company to go down.
It's the same business, less the cash that left to go to other places.

The effect on value per share is a function of the price/value ratio at which the purchase is done.
Might be higher, lower, or the same.

Jim

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