3 Takes on Investment in the United States: 3

Regarding the question savings glut versus investment scarcity, a week ago, I wrote to the Washington Post journalist, Steve Mufson, asking how long he thought that Exxon's stock buybacks exceeded real investment. He told me he thought it was as long as he was covering the subject -- a couple of years. Today, the Wall Street Journal has a nice piece showing the data with a remarkable upward trend in stock buybacks.

All this is further evidence of this corrosive dominance of financialization.




Anders, George. 2008. "Exxon's Stingy Capital Spending May Haunt It." Wall Street Journal (16 April): p. B 2.

In 2007, Exxon spent 5.3% of revenue on exploration and capital outlays, down from 6.5% in 2003. The actual dollar amounts did increase, to $20.9 billion from $15.3 billion. But they didn't keep pace with Exxon's overall revenue growth, let alone soaring oil prices. Crude climbed to about $92 from $34 a barrel during that period. Meanwhile, the Irving, Texas, oil giant poured cash into stock buybacks. In 2007, Exxon repurchased $31.8 billion of its shares, up five-fold from the amount acquired in 2003. That activity helped earnings per share. It didn't increase oil output.