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The article doesn't say there won't be a double-dip, but rather that even if it does recover, the long term conflicts will remain. Corporate profits have indeed recovered, and indeed in certain industries, like semi-conductor fabrication, capital spending has increased and dramatically, to the point where overproduction is closing in again and prices of DRAM chips, and perhaps NAND, have peaked. Shipbuilding has once again been overbooked so we can expect to see freight rates falling and ships at anchor. Corporations in the US are sitting on over a trillion dollars in cash, and cash-like securities-- loading up through bond issuings, layoffs, improved profits, and restraints on capital spending. Between the 2Q 2009 and the 2Q 2010 NET property, plant, and equipment for US manufacturing declined from $1.273 trillion to $1.255 trillion, which indicates that depreciation and the liquidation of PPE is exceeding the rate of new investment. Capacity utilization rates are still below historic averages, so I don't expect to see another burst of capital spending acros the board in manufacturing. Will there be another dip? First off, the recovery has not brought the output back to pre-recession levels. Secondly, the recovery, like the post 2001-2003 recovery is being financed by dollar depreciation, wage reductions, restraints on spending... and the post 2003 recovery was the weakest on record in terms of job creation, rate of growth of output etc. So the real question just might be... what difference does a double dip make when recovery itself is simply a weaker form of contraction? ----- Original Message ----- From: "robert mckee" <bobmcke...@yahoo.com> To: <sartes...@earthlink.net> ________________________________________________ Send list submissions to: Marxism@lists.econ.utah.edu Set your options at: http://lists.econ.utah.edu/mailman/options/marxism/archive%40mail-archive.com
