On January 8, Bank of England monetary policy member Mann said that the outlook for U.S. productivity growth after the epidemic is “not optimistic”. S&P 500 companies now have $3.7 trillion in cash, up from $2.2 trillion in 2019, and are spending their earnings on share buybacks and mergers rather than investing in the future.
Basically, we’re seeing that most of the interest is currently skewed toward financial uses rather than supporting a real discussion of investment and innovation, so we’re looking at the forecast for potential U.S. output growth over the medium term, which is not optimistic. Active mergers and acquisitions are taking away the competitive spirit.