Businesses Still Aren’t Investing Much

Dean Baker points to this report from the Washington Post on Friday:

The Commerce Department report showed a robust contribution from business investment, which rose more than 6 percent. That seemed at odds with Thursday’s Census Bureau report that nondefense capital goods orders, excluding aircraft, fell 0.1 percent in March and that preliminary results from earlier months had been revised lower.

Baker explains why there’s no contradiction here at all, but naturally I prefer showing it in chart form (I’ve removed recessions to make the chart easier to read):

There are two things to note. First, growth of 6.1 percent is not especially robust. It’s OK, but it’s been higher than that plenty of times. Second, it went down in Q1. What’s more, as Baker explains, this mostly tells us about investment decisions made at least a year ago. To get a read on current levels of corporate optimism, you want to look at orders for capital goods:

There’s just no there here. Business investment is at normal levels; it went down a bit in Q1; this has nothing to do with current corporate decisionmaking anyway; and orders for capital goods have been pretty lethargic since the tax plan passed. Let’s check back in a year, OK?

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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