Capex Expected to Collapse 25% in 2015

Business investment has played an integral role in hopes that a bustling U.S. economy would light the way for the rest of the world in 2015.  Tumbling gas prices, a newly resurgent U.S. dollar and a weak-spending consumer have taken considerable luster off that picture.

In fact, companies reporting quarterly earnings are predicting not robust times ahead but rather tepid profit growth, with a cornerstone of those forecasts being a drop, not a rise, in capital expenditures, or capex.

Goldman Sachs lowered its capex forecast from a gain of 6 percent to a decline of 3 percent, a stunning turnaround that the firm attributed primarily to weakened energy companies that have suffered from oil’s decline. The number represents the worst figure since the financial crisis days of 2009.

CNBC

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