US private investment dwindles

Private investment is declining as a percentage of GDP. Not a good sign when you consider that a similar decline preceded previous recessions.

Private Investment and Private Credit to GDP

Click graph to view full-size image.

Also a concern, when private credit is rising as a percentage of GDP while investment is falling. Crossover of the two lines would indicate that the private sector is borrowing more than it is investing. That is not likely to end well.

One thought on “US private investment dwindles

  1. […] There is one other factor that I believe is a major determinant of low productivity gains and hence GDP growth. Private investment — a major contributor to productivity improvement — is declining as a percentage of GDP. […]

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