Comment by Atheros

I really don't think any of that is true; it's just popular rhetoric.

For example: "Buybacks concentrate cash in the hands of existing shareholders" is obviously false: the shareholders (via the company) did have cash and now they don't. The cash is distributed to the market. The quoted statement is precisely backwards.

> A big chunk of that cash just gets recycled

That doesn't mean anything.

> more financial claims (index funds, private equity, secondary shares, etc)

And do they sit on it? No, of course not. They invest it in things. Real actual things.

> buybacks

Already discussed

> M&A

If they use cash to pay for a merger, then the former owners now have cash that they will reinvest.

> balance sheets

Money on a balance sheet is actually money sitting in J.P. Morgan or whoever. Via fractional reserve lending, J.P. Morgan lends that money to businesses and home owners and real actual houses (or whatever) get built with it.

The counterfactual for AI spending really is other real actual hard spending.