The stock market rally has been lacking something over the last several years. Rising stock prices are typically accompanied by rising capital expenditures. But over the past several years, this has not been the case, as capital expenditures have effectively stalled as stock prices have soared to new all-time highs. Looking forward, a long overdue pick up in capital spending will be required to keep the stock market going to the upside. Conversely, if business investment ends up contracting, it would effectively take wrecking ball to the post crisis stock market rally along with it.
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