“Ultra-low rates cause investors to pile into increasingly poor investment choices – overvalued stocks, bonds, real estate, etc.  But ultra-low rates have other, more subtle, effects, too…  As we’ve been reporting, it also makes it extremely easy for corporations to borrow. And as the chart below shows, they’ve been borrowing like crazy recently.  What have they been doing with all this money?  One major source of spending has been share buybacks.  Over the past four years, share buybacks have totaled between $75 billion and $159 billion a quarter.  And in the first quarter of this year they reached a high exceeded only by a couple of quarters in 2007.”

http://bonnerandpartners.com/what-happens-when-share-buybacks-dry-up/

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