Jamil Jonna wrote: > ... With the growth of monopoly, the opposite is the case: the surplus tends > to rise yet there is nowhere to invest it.
me: > but there are always a lot of places to invest surplus. A company can invade > other markets, buy politicians, etc. Jamil: > That certainly does not explain why the major corporations are sitting > hundreds of billions of dollars. Nor does the "growth of monopoly" (among other things because I can't see that this growth exists). The key reason that corporations are sitting on their cash is an interconnected combination of pessimism about the success of new tangible investment projects, unused capacity in already-existing fixed capital, and the unwillingness of banks to lend at current interest rates (i.e., credit rationing). The latter arises from the continued shaky bank balance sheets and fears about the same problem afflicting borrowers. In other words, the firms are living in the aftermath of a severe financial crisis and a deep recession. It's a macroeconomic problem. In event, we've seen a lot of money spent on purchasing politicians during the last year. The difficulty with tangible investment projects might explain some of the reason why so much was spent to do so. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
