What Makes Stocks Rise?

What makes stocks rise? Is it luck? An easy monetary policy? Multiple expansion? Or just good old management skill? Wall Street has always favored management teams, which deploy financial resources and capital sources to maximize shareholder value. But in recent years, the ever-increasing number of companies that have been ploughing cash into share buybacks and dividend payments at the expense of business investment has drawn plenty of criticism. The question is, is this trend towards shareholder returns over capital investment robbing the economy of future growth? Earlier this year, at a symposium sponsored yesterday by Gamco, the investment firm run by Mario Gabelli…