“I could borrow $2 billion tomorrow for 3 1/2 percent. But what am I going to do with it?” David Speer, CEO of Illinois Tool Works.
Further words of wisdom from Mr. Speer: “It took us a decade to get in the ditch we are in. There isn’t going to be instant gratification to get us out of it. We’re going to have to get used to a lower growth economy, and that is going to be a big adjustment for all of us.”
Sarcasm aside, the bottom line seems to be: why invest when there is excess capacity in most industries and an excess supply in housing? Excess capacity, or lack of demand, fuels a scarcity of new investment… a key reason for the sluggish recovery. Housing prices are not expected to return to pre-bust levels for some time… indeed, some say never again.