The Slow Collapse of Long Term Planning | How Money Works
Nov 17, 2025
Business debt in the U.S. is skyrocketing, nearing $14 trillion, raising concerns about financial stability. The focus on short-term profits has led to stagnation in major companies, as executives prioritize stock buybacks over employee investment. This trend reflects a broader shift from value creation to value extraction in corporate culture, fostering disparity in pay and diminishing long-term growth potential. The podcast critiques this approach, calling for a return to sustainable business practices to ensure healthier economic outcomes.
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insights INSIGHT
Corporate Debt Exceeds Practical Safety
U.S. business debt is near record highs at about $14 trillion and firms can't print money to rescue themselves.
Rising rates expose companies that borrowed to finance buybacks rather than productive investment.
question_answer ANECDOTE
Recent Headlines Illustrate The Trend
The transcript lists contemporary corporate headlines like GM buybacks and Bed Bath & Beyond bankruptcy as examples.
These snapshots illustrate how buybacks and poor strategy coincide with real business failures.
insights INSIGHT
Buybacks Distort Corporate Priorities
The repeal of buyback limits in 1982 let firms boost share prices without improving operations.
Buybacks inflate EPS and CEO pay while diverting funds from R&D and long-term investment.
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While everybody and their chainsaw is fixated on US federal debt, there is another type of debt that has grown just as fast, and is most likely a bigger problem… Business debt is now at all time highs and is approaching 14 TRILLION dollars in America alone. Unlike the government, private businesses don’t have the luxury of printing their own money in an emergency, and as interest rates have risen they are starting to feel the squeeze. To make matters worse most of this money hasn’t been used to make productive investments, it’s been used for “financial engineering” to make investors happy… in the short term. This trend is the result of a business strategy that can explain the stagnation of companies like boeing, intel and general electric, it’s largely responsible for increasingly unstable stock markets AND it’s also making that other debt situation much worse. Now the best part is that this has been tried many times before and people KNOW that it’s not sustainable… but that’s a problem for next quarter…
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