The economics (and politics) of trucking

[Joel (Joel Norris)]

@bencarmack

His reasoning is that heavy government borrowing crowds out other borrowers from capital markets. Companies have profits and there’s money out there, but either they can’t access it, or if they can, they’re not interested. There’s a loss of nerve, a loss of mojo. That’s why there’s this odd combination of lots of gover ment spending, low interest rates, low unemployment and low growth. Bahnsen says that’s been the status quo since the Great Recession.

Government borrowing can’t be crowding out other borrowers if there’s lots of money out there, and ascribing the current state of the economy to loss of nerve/mojo is handwaving. The reality is that corporations do not see much growth opportunity in their own businesses, so rather invest in increasing production they do stock buybacks or consolidate in order to increase profits through monopolization.

[jtbayly (Joseph Bayly)]

Stock buybacks are often just a lazy way of increasing the stock price.

Which, let’s face it, if a substantial part of your pay as CEO is in stock…