Some wonderful stuff on how repurchases made at high prices destroy capital from both Buffett & Bloomstran...

Buffett on stock buybacks:

"Just as surely, when a company overpays for repurchases, the continuing shareholders lose.
At such times, gains flow only to the selling shareholders and to the friendly, but expensive,
investment banker who recommended the foolish purchases."

Blomstran on buybacks:

"As for the S&P500, after about a third of profits are sent to index shareholders as dividends,
more than 100% of the retained balance is used repurchasing shares to merely offset the dilution
that results from giving 2% of the average company to insiders each year as options and restricted shares.
Share reduction of the index companies was a modest 0.7% per annum for the past decade. Said differently,
companies spent roughly 60% of profits to purchase 2.7% of their market capitalization each year,
yet only reduced the share count by 0.7% annually. Bully. Retained earnings are NOT reinvested at the return on equity.
All retained earnings are spent repurchasing expensive shares. Repurchases made at high prices destroy capital."