Whereas the financial cycle hypothesis argues that investment is temporarily low, the secular stagnation hypothesis predicts permanently low investment. Despite their differences, both hypotheses have a common denominator: demand. In particular, uncertain future global demand is seen as a key factor weighing on business investment growth.
Figure 3: Historical shock decomposition of real business investment growth Percentage points 20 15 10 5 0 -5 -10 -15  Foreign demand Real lending rate Real gross operating surplus Real stock prices  2016  2013  2010  2007  -20  Uncertainty* Real consumption Real business investment  *Average over various uncertainty indices (consensus, policy, macro, financial, Jurado et al.)