ECON 252: Financial Markets
Lecture 11 - Stocks. The stock market is the information center for the corporate sector. It represents individuals' ownership in publicly-held corporations. Although corporations have a variety of stakeholders, the shareholders of a for-profit corporation are central since the company is ultimately responsible to them. Companies offer dividends, stock repurchases and stock dividends to give profits back to shareholders or to signal information. Companies can also take on debt to raise capital, creating leverage. The Modigliani-Miller theory of a company's leverage in its simplest form implies the leverage ratio doesn't matter, but including bankruptcy costs and tax effects give us a positive theory of the ratio. (from oyc.yale.edu)
| Lecture 11 - Stocks |
| Time | Lecture Chapters |
| [00:00:00] | 1. Introduction |
| [00:04:24] | 2. The Corporation as a "Person" |
| [00:14:02] | 3. Shares, Dilutions, and Stock Dividends |
| [00:31:26] | 4. Distinguishing Earnings and Dividends, and Getting Money Out of Companies |
| [00:42:38] | 5. Stock Repurchases and the Modigliani-Miller Proposition |
| [00:57:13] | 6. Corporate Debt and Debt Irrelevance |
| [01:07:58] | 7. The Lintner Model of Dividends |
| References |
| Lecture 11 - Stocks Instructor: Professor Robert J. Shiller. Resources: Lecture 11 [PDF]; Problem Set 4: Dividends, Debt, and Balance Sheets [PDF]. Transcript [html]. Audio [mp3]. Download Video [mov]. |
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