2025's Buyback Boom: A Historical Echo of 2007's Cash Hoarding

The current market environment is defined by a powerful, if fragile, support mechanism: corporate buybacks. Companies are repurchasing shares at a record pace, with the trend driven by both strong earnings and a stall in investment plans amid trade uncertainty. This creates a direct, earnings-per-share (EPS) boost. When a company buys back its own stock, it reduces the number of shares outstanding, which can lift EPS even if net income remains flat. This is a key reason why high buyback intensity, especially relative to market cap, can support share prices. For instance, Goldman Sachs is buying back $40 billion in shares, equal to 18.1% of its market value. That kind of scale, even if it doesn't move the needle on absolute EPS, signals a company confident in its cash generation and willing to return capital aggressively.