The new economy and earnings of US companies?
When Wall street started to rely more on earnings evaluation abiove all other evaluations; they were extremely sensitive to earnings short fall. In reality, the earnings are but one factor in the value of companies. It is a continuing value, and it must have a heavier weighted factor. What is not considered, is the number of companies in the United States. Dunn and Bradstreet probably lists over half a million companies. Out of which 18,000 bankrupts each year. Out of 8000 public companies, each quarter, you will probably hear 1-200 companies which can not meet earnings estimates. Although 5% short falls are not bad; the analysts probably should do some management consulting to know what to do to turn the short falls around long before the facts. The call for more MBA's to join Wall street firms can not be neglected.
Central planning in America is calling for more productivity, up to 10% again, this year. Computer efficiency with more management control software will be used this year, after many successes in many businesses last year. Steadly, the new economy is slowly improving, any real slow down is no where in sight. Labor tightness is also no where in sight. At any time in the day, you can see able bodied people shopping and enjoying their lives. If we have jobs, they can be put to work. You can loaf only so long, without the need to feel needed. |
