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Friday, August 21, 2015

For Caterpillar, This Is What The "Second Great Depression" Looks Like

Having repurchased billions of its own stock near the all-time high price (or, to avoid cause-and-effect confusion, leading to all time high prices), Caterpillar recently hit its debt issuance ceiling and as a result is no longer able to sell debt and use the proceeds to buyback stock. The result: CAT stock has recently tumbled to levels last seen in 2011. And judging by its monthly retail sales data it is going much, much lower.

The reason: the second great depression which for industrial bellwether CAT started in December 2012 and has since resulted in 32 consecutive months of declining global retail sales and over a year longer than the decline observed during the great financial crisis, refuses to go away.

4 comments:

Anonymous said...

What they get for leaving our country to save money!

Anonymous said...

Mining and commodities are in the hole and so goes Caterpillar.

Anonymous said...

CAT sells more outside the US than in...shows a global slowdown that has never come back.

Anonymous said...

Here comes Warren Buffett, the bottomfeeder.