Is it ever really a good idea to buy back one's own stock? Probably not; can't think of even one good, compelling financial reason to do it. But what we have now is just the opposite: companies issuing stock to shore up their balance sheets, even at what many consider "depressed" valuations. In many cases, these companies don't have a choice. Banks -- issuers of lines of credit that need to be rolled over from time to time -- are being very heavy handed, "forcing" even the best companies to de-lever.
This is a win-win for companies such as JP Morgan, which has been involved in almost every major equity secondary out there. They will reap substantial income from the underwriting fees, and suddenly their clients become much more creditworthy. JPM's probably a great stock to own over the next few years....
Position: Long FAS (JPM is the biggest component)
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