US Capacity Utilisation is Historically low


According to this graph (open in a new window to view it properly), the US stimulus restored capacity utilisation from the worst plunge in the data shown, but nevertheless it is still relatively low by recent historical standards, which indicates that the US is far from full employment.

Just look at where the rate was back in last booms of the golden age of capitalism (1946–1973): close to 90%. Even the Clinton boom years had a higher rate than now.

The lesson is not that stimulus does not work (look at the V shaped recovery), but that more is necessary. Much more.

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