Jason: it is a very engaging read. I read it twice and I am struggling to reconcile the final "gutless managers" point with the rest of the write-up. I am assuming you are (rightly) pointing out many "Type 1" errors in projects taken on today as a result of lower interest rates. I interpret this as capital managers growing more risk-tolerant, i.e. requiring lower absolute rates of return due to the relative rate framework. If anything, this should imply "too much gut" and too little selectivity of risk.

Yet, a quick "empirical" survey of corporate behaviors today suggests companies are still shy to fully invest their "pilling" cash, resulting in the mismatch between revenues and EPS trends you point out. This could be attributed to a continuing focus on controlling cost rather than growing, in my opinion, that stems from a Great Recession-relaated PTS syndrome, indeed fitting the "gutless" characterization.

I suppose what I am saying is, I miss the transition in the article or may need a couple of further reads.

Long time reader, first time commenter, and hopeful for some good level 3 results this August,

ilir