Blog post here: https://bahnsen.co/3KW53PY

ASK DAVID

~ Luke L.

I think one of the major tenets of Japanification is “low/slow/no growth,” and therefore, an obvious antidote (tautologically) is “growth.” I think the testimony of history is a clear and particularly recent experience that in a period of low capital expenditures, which are needed to improve productivity, which is needed to generate growth, removing disincentives to such productive investment is key. Forcing businesses to make large (and risky) investments NOW, but only to deduct that expense over time, is a disincentive. Immediate cash expensing incentivizes capex, which drives productivity, which drives growth.

Links mentioned in this episode: