tag:blogger.com,1999:blog-6616959642391988608.post5066403985793779078..comments2024-03-19T02:45:37.685-07:00Comments on Calafia Beach Pundit: Corporate profits juggernaut continuesScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-6616959642391988608.post-59811860563100437482014-12-01T19:22:23.457-08:002014-12-01T19:22:23.457-08:00Interesting post, as usual.
I have done some work...Interesting post, as usual.<br /><br />I have done some work on this. You are clearly right about globalization. An increasing share of corporate income is coming from international sources. When this is corrected for, the level of domestic profits is more subdued.<br /><br />I think there is an additional issue that you haven't addressed here. Free Cash Flow to the Firm goes to debt and Kevin Erdmannhttps://www.blogger.com/profile/07431566729667544886noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-37873230807744084192014-11-30T15:52:53.754-08:002014-11-30T15:52:53.754-08:00A good portion of the enthusiasm for equities seem...A good portion of the enthusiasm for equities seems to be bases upon two beliefs: 1) there is no other place to put one's money and 2) profit margins will remain unusually high and NOT revert to the mean.<br /><br />To me it seems that all the "economic surprises" are negative ones: Japan is in recession again, China's manufacturing and GDP grow was less than expected, Germany&#Williamhttps://www.blogger.com/profile/04418491109912775561noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-64212907762154542422014-11-30T06:47:09.915-08:002014-11-30T06:47:09.915-08:00While companies may be better managed today, they ...While companies may be better managed today, they certainly have become expert in limiting supply optimally for higher prices.<br /><br />In the previous post it is pointed out that oversized profits lead to increased supply. The supply curve shifts.<br /><br />Oligopolies have learned how to not shift it.<br /><br />The Wall St. Journal reports 12 month trailing PEs as of 11/28:<br />Dow 30 Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-16808510281872584132014-11-26T22:53:00.283-08:002014-11-26T22:53:00.283-08:00Interesting post. Corporate profits are at all-tim...Interesting post. Corporate profits are at all-time record highs, even relatively. <br /><br />I think global competition is ferocious, so I am not inclined to the idea that less competition explains profits. <br /><br />I think aligning of management with shareholders explains some of it. Compared to the country-club boards and fat management of yesteryear, today's companies are Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-59943226665758427862014-11-26T13:18:50.453-08:002014-11-26T13:18:50.453-08:00The persistency of super-high corporate profits as...The persistency of super-high corporate profits as a percentage of GDP has been one of the most intriguing stats of recent years and is, I believe, the flashpoint of the disagreement between bulls and bears.<br /><br />I've wondered why it has stayed so high for so long. Scott, I found your explanation of globalization to be a little, uh, incomplete.<br /><br />My best guess is that it Grechsterhttps://www.blogger.com/profile/08898953158865778397noreply@blogger.com