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Short-termism is as much consequence as cause of weak growth

Summary:
If you want companies to return less money to shareholders, then you should be able to defend an alternative choice for what they should do instead with their cash.But in times of slow economic growth, all options are problematic. That’s the premise of my On Wall Street column from the Weekend FT, and it’s a direct extension of two earlier posts discussing the idea that investment is as much a function as a cause of weak economic growth. (I think it’s both.)An excerpt:A useful prism through which to understand the issue is to consider the other options themselves in the context of the current recovery — the slowest-growing US expansion of the postwar period.First, a company might use the money for fixed investment, superficially the most pleasing option. But what if opportunities are

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If you want companies to return less money to shareholders, then you should be able to defend...

Cardiff Garcia
Cardiff writes mostly about US macroeconomic issues, with daily excursions into other topics about which he claim no expertise. Before Alphaville, Cardiff spent a little more than two years as a reporter at Dow Jones Financial News covering investment banking, asset management, and private equity. Along the way he has written freelance pieces on a variety of other topics from behavioural psychology to Muay Thai, the latter also being a personal interest that involves frequently getting kicked in the shins (and torso, and head).

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