Hot on the heels of the biggest collapse in Australian Capex ever, and just as we predicted back in 2012, we thought it about time to once again re-visit – Godot-like – the never-ending wait for ‘recovery’ (or ongoing crash) in Capital Expenditure around the world.
Back in 2012 we accurately predicted that in the Brave New Normal World, where zero cost debt-issuance is used to immediately fund stock buybacks instead of being reinvested in growth and expansion, in the process boosting management pay through equity-performance linked option payout structures, that with every passing year CapEx spending would decline first in relative then in absolute terms, even as free cash flow use of funds is spent on other “here-and-now” shareholder-friendly activities such as buybacks and dividends would grow exponentially.
This post was published at Zero Hedge on 11/26/2015.
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