From 1992 to 1999 American nonresidential investment jumped by 3% of GDP, for instance, driven in large part by extra spending on computer technologies. Yet so far there is little sign of an AI splurge. Across the world, capital expenditure by businesses is remarkably weak. Some companies are once again ramping up capex, to seize what they see as the enormous opportunity in AI. This year forecasters reckon that Microsoft’s spending (including on research and development) will probably rise by close to 20%. Nvidia’s is set to soar by upwards of 30%. Exclude firms driving the AI revolution, such as Microsoft and Nvidia, and those in the S&P 500 are planning to lift capex by only around 2.5% in 2024—ie, by an amount in line with inflation. Across the economy as a whole, the situation is even bleaker. An American capex “tracker” produced by Goldman Sachs offers a picture of businesses’ outlays, as well as hinting at future intentions. It is currently falling by 4%, year on year.
- Date Posted:
- January 5, 2024
Texas’ growth has been among the most impressive given its size—its real economic output has increased by $230B over the last four years, putting it just barely behind California as the second-largest contributor to nationwide growth despite Texas’ economy ending 2019 30% smaller than California’s. Job growth in Texas has been so large that one in five new jobs in America come from Texas alone. The Dallas metro area, despite being less than 1/3 the size of the New York metro, has contributed more to nationwide economic growth over the last three years than any other. That impressive growth has allowed Texas to pull ahead of NY in overall GDP and in white-collar professional, scientific, and technical services output over the last four years.