It has been a while since U.S. small-caps reached a new high (arrow in Chart 1). The Russell 2000 small cap index (1209.74) peaked in June last year at 1296. Small-caps have massively underperformed large-caps. Both the S&P 500 large … Continued
Versus large-caps, small-caps inherently suffer from shorter operational history, less access to capital, lower trading liquidity, lack of support from most mutual funds, lack of familiarity, lack of/less Wall Street research, and what not. Understandably, they are regarded as risky. … Continued
At the start of the year, real GDP in the U.S. was expected to grow at three percent or better this year. Actual numbers are falling short – substantially. In the first three quarters, growth has been on a sub-two-percent … Continued
The energizer bunny marches on. The U.S. consumer, that is. In the third quarter, the U.S. economy grew an annualized 1.5 percent. This was the first estimate, so it probably gets revised up or down by the time we have … Continued
U.S. corporations have had their share of blame as relates to capital expenditures, wages, etc., but have done a commendable job when it comes to taking advantage of the prevailing low interest-rate environment. Corporate profits have come a long way. … Continued
It has been a consistent theme post-Great Recession. U.S. businesses have persistently disappointed when it comes to capital expenditures. It does not look like we will see a trend change anytime soon. The National Federation of Independent Business, representing small … Continued
U.S. corporate profits (adjusted for inventory valuation and capital consumption) broke a two-quarter downtrend in 2Q15, up 2.4 percent quarter-over-quarter to $2.06 trillion. This followed two consecutive quarterly drops in 4Q14 and 1Q15. A welcome change! The back-to-back drop in … Continued
U.S. productivity continues to leave a lot to be desired, and that can have repercussions for corporate earnings. Non-farm output per hour grew a mere 0.26 percent year-over-year in the second quarter, down from 0.63 percent sequentially. Quarter-over-quarter, it rose … Continued
Last week when the advance report on U.S. durable goods for June was published, new orders for non-defense capital goods ex-aircraft – used as proxy for business capital expenditures – were $68.4 billion, and May was reported as $67.8 billion. … Continued
In the second-quarter advance estimate for U.S. GDP released yesterday, one of the things that jumped out was the level of inventories. Private businesses accumulated $124 billion in nominal inventories. In 1Q15, these were $127.3 billion (Chart 1); 1Q15 was … Continued