American corporations reduced the amount paid shareholders as dividends, on a annual basis, to the lowest level in nine years. (Federal Reserve Flow of Funds Accounts, Q3 2005, Table 102).

Although after-tax profits were 56% higher than last year, annual dividend payouts as of Q3 2005 were only 58% of amounts paid as dividends in 2004.

At the same time, companies radically increased amounts spent on repurchasing and retiring equity to an extraordinary annual rate of $446.2 billion, which was greater than the total amount spend for this purpose over the previous five years.

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