Never Go Full Krugman

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The financial geniuses at the New York Times are puzzled over what they call the “Economic Mystery” of 2016. As Adam Davidson just put it in the New York Times Magazine, “financial experts” cannot figure out why American corporations are sitting on $1.9 trillion in cash, “just sitting around.”  From Davidson:

The notion that a corporation would hold on to so much of its profit seems economically absurd, especially now, when it is probably earning only about 2 percent interest by parking that money in United States Treasury bonds. These companies would be better off investing in anything — a product, a service, a corporate acquisition — that would make them more than 2 cents of profit on the dollar, a razor-thin margin by corporate standards. And yet they choose to keep the cash.

According to Davidson, this “strange vogue” for corporate hoarding seems to have begun after the turn of the Millennium and has only accelerated in recent years. Heh. It really seems to have not occurred to these economic prodigies that confidence in the current economic conditions are at nearly all-time lows. It seems equally impossible for them to believe that this could be linked to nearly eight years of a lawless and politically vindictive regime administration. And, with the very real possibility of an even more extreme leftist administration replacing it within the year, one can not escape the harsh truth that no one expects to make an honest profit any time soon.

But it gets better. Davidson expresses intense frustration with this trend, because: “These numbers are maddening on their face. If the companies spent their savings, rather than hoarding them, the economy would instantly grow, and we would most likely see more jobs with better pay.” What??? I just watched the President’s State of the Union address just days ago, and I distinctly heard him say that the economy has never been stronger. Is somebody not being truthful with us?

After all, the two American companies holding the most cash, GM (half their value in cash) and Apple (more than a third in cash), are politically strong backers of the current administration in Washington, so one would expect them to believe what the administration tells us. Yet they act in exactly the opposite direction. Why should the public, with their own money, act any differently?

This corporate behavior should send us a strong signal, then. We should hang on to what savings we have, and prepare for very bad times, indeed. And above all, believe nothing that this administration tells us about the economic future, and certainly believe nothing the New York Times tells us, because the very smartest of corporate America is believing none of it.

Cross-Posted at Political Clown Parade.  Reference in title is to Paul Krugman, Professor of Economics and writer for the NY Times.

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About GruntOfMonteCristo

Fearless and Devout Catholic Christian First, Loving Husband and Father Second, Pissed-Off Patriot Third, Rocket Engineer Dork Last.
This entry was posted in Bernie Sanders, Economy, Hillary Clinton, Obamanana Republic, Uncategorized. Bookmark the permalink.

2 Responses to Never Go Full Krugman

  1. solaratov says:

    The murder of LaVoy Finicum……

    • Yup. I saw that idiot sheriff’s press conference. If I hear another moron who failed history class tell me that “Americans don’t resort to armed resistance; that’s not who we are,” I’m gonna blow a blood vessel in my forehead.

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