How come there is a positive effect from the increase in net borrowing from FCFE, but no increase in FCFE when the company decides to issue new shares?
FCFE is money you could give to your shareholders.
So you issue stock and get a bunch of money from shareholders, then give it all back to the shareholders. How, exactly, have the shareholders (as a whole) benefited?
Because it is still money that you can give to shareholders (as per your first definition).
The shareholders don’t benefit, so it has no effect.
That’s it.
Because companies dont issue share for them to redistribute the proceeds to the shareholders.