Thursday, December 24, 2009

Capital spending picks up

Business investment is definitely picking up, with new orders for capital goods about 10% higher in November than they were at the low last April. Capex is still woefully below the levels it reached in the booming late-90s, but it is following the typical pattern in which it rebounds as a recession ends. It will take us many years to return to the heydays of the past, but at least we are moving in the right direction.


Bill said...


Merry Christmas to you and your family. Thanks for all the positive reports. It would be fun to compare your predictions last year with those who still fight you at every turn. I bet they thought we'd all be on bread lines by now!

Scott Grannis said...

Thanks, Bill. One of the things that has helped sustain my optimism has been the steady drumbeat of pessimists who thought I was nuts to be so optimistic. Hordes of investors and pundits have been proven desperately wrong this past year, and they are still fighting it. We haven't seen the end of this story.

Public Library said...

Looks like a double top to me...

alstry said...

If you think about, the only reason we don't have 40,000,000 Americans standing in bread lines is because we are giving them food stamps directly as a result of deficit spending.

If we had a balanced budget, you think there would be a dime for food stamps and prosecuting multiple wars at the same time?

The only reason we are able to provide 60% of health care revenues (18% of GDP) is because we are running a massive government deficit.

The only reason we have over 16,000,000 families receiving unemployment checks and spending spending spendnig is because of an unprecedented deficit.

The key reason why over 20,000,000 people receive their paycheck directly from the goverment is due to President Obama spending trillions of dollars that don't exist but for printing by the Federal Reserve.

I guess if we added up the above, it would equal about the current deficit.....and we still have lots of government spending unaccounted for like military, homeland security, etc.....

It appears over 100,000,000 Americans, and America's GDP, are dependent on President Obama spending Trillions of dollars that don't exist....and with tax receipts continuing to decline while expenses exploding....that number appears likely to grow dramatically.


alstry said...


Bloomberg Headline

Schwarzenegger Seeks Obama’s Help for Deficit Relief

Ahnald needs a cool $21 of now and practically every other state in the union is desperate for cash.


How long do you think interest rates can hold with all this insane and growing deficit spending going on?

If the Fed loses control of rates since no nation in the world is capable of funding our deficit....what do you think the impact will be?

Right now if we taxed the top 10% of taxpayers, those making over $100K and 70% of total tax receipts, 110% of their income, it would not be enough to bridge the defcit.

At some point we may be facing a revolution in America because those that work for private industry who lose access to credit lose their jobs, business, and livlihood, yet those that work for government or Wall Street, even though in a similar or worse financial condition, still have credit and still receive paychecks and bonuses.

You can see and feel the anger rising in America....if we maintain the same policies of unlimited deficit spending for Wall Street and Washington but contracting credit for the rest....the outlook is not very positive during this normally festive time of the year.

Bill said...


I enjoyed watching Bill Gates and Warren Buffett speak at a town hall meeting at Columbia this afternoon. Both were very optimistic about the future of the country. I suppose there are always going to be folks like Alstry who are quick to count America out, but this country, as Buffett said, has endured much worse and always prevailed.