In particular, a downturn in investment does not, by itself, imply that firms view their capital stocks as being too large. The rate of change in the stock of capital reflects both the spending on new capital – that is, gross investment – and the rate at which capital is being consumed, mainly through depreciation.
Even at rates well below those of a year ago, today's investment still likely exceeds by a significant margin the pace at which capital is depreciating. Thus, the stock of capital, at least for the economy as a whole, probably is still expanding at a brisk pace.