It's Not about Consumption! - Robert Higgs - Mises Daily

It's Not about Consumption! - Robert Higgs - Mises Daily: 'real personal consumption expenditure recovered from its recession decline by the fourth quarter of 2010. Continuing to grow, it now stands (as of the most recent data, for the second quarter of 2011) even farther above its prerecession peak.'

'The economy remains moribund not because consumption spending has failed to recover and not because government spending has failed to increase but because the true driver of economic growth — private investment — remains deeply depressed. Gross private domestic fixed investment fell steeply after the second quarter of 2007, and in the second quarter of 2011 it remained 19 percent below its prerecession peak. This figure fails to show how bad the investment situation really is, however, because the bulk of the investment spending now taking place is for what the accountants call the "capital-consumption allowance," the amount estimated as necessary to compensate for the wear and tear and obsolescence of the existing capital stock.'