Financial shenanigans wiped out all productivity gains from digital technology


The new report from the Deloitte Center for the Edge says that, "return on assets for U.S. companies has steadily fallen to almost one quarter of 1965 levels,at the same time that we have seen continued, albeit much more modest, improvements in labor productivity." Jon Taplin explains, "any productivity gains from the digital revolution have been more than wiped out by our corporate (as well as personal) addiction to debt. To understand this, it's important to grasp the difference between return on equity (the classic Wall Street measurement) and return on assets...By masking their absolutely dismal performance in the last 40 years in ROA, by taking on more and more debt to juice ROE, both Wall Street and America's corporate elite are engaged in a massive shell game, in which the average investor is the mark."

America's Corporate Shell Game (Jon Taplin)

The Shift Index (Deloitte Center for the Edge)

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