JPMorgan Has Spent $18 Billion Buying Back Its Own Stock in Four Years

Courtesy of Pam Martens.

Wall Street Bull Statue in Lower Manhattan

As Wall Street On Parade reported last week, Jeffrey Kleintop, Chief Market Strategist for LPL Financial, reports that corporations are now the single largest buying source for U.S. stocks – authorizing buybacks of their own stocks to the tune of $754.8 billion in 2013 alone.

And it’s a long-term trend. According to Birinyi Associates, for calendar years 2006 through 2013, corporations authorized $4.14 trillion in buybacks of their own publicly traded stock in the U.S. — raising the question, just what kind of a bull market is this?

JPMorgan Chase, the largest U.S. bank by assets, has turned share buybacks into an art form, buying back a whopping $17,945,000,000 of shares from 2010 through 2013. In just the calendar year of 2011, JPMorgan spent a stunning $8,827,000,000 on stock buybacks.

According to JPMorgan’s most recent quarterly report filed with the Securities and Exchange Commission, “the Firm’s Board of Directors has authorized the Firm to repurchase $6.5 billion of common equity between April 1, 2014, and March 31, 2015.”

If the full authorization of $6.5 billion is spent by the first quarter of next year, JPMorgan will have tapped its capital to the tune of $24.5 billion – not to lend to deserving businesses or home buyers or consumers, but to binge on its own stock buybacks.

Having a steady pool of billions of dollars to prop up a stock’s share price might seem like a neat trick to top corporate executives whose compensation is tied, in part, to the performance of the company’s stock, but it does little to help a nation struggling from the aftermath of the economic ravages unleashed by the big bank financial crash in 2008.


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