Horror stories: “In the early stages of a recovery, the corporate sector usually runs a small financial surplus, investing less than cashflow. But America’s companies continue to run a deficit. Worse still, profits have remained feeble. Ian Harwood, chief economist of Dresdner Kleinwort Wasserstein, estimates that profits across the whole economy, as measured in the national accounts, fell again in the fourth quarter of last year?the third quarter in a row of decline after a brief recovery. This may explain why firms are still cutting jobs. American households have done even less to repair their balance sheets.”