Another Trump accomplishment!

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SlugSlinger

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And another news story you won't hear with the fake news:

U.S. Companies Post Profit Growth Not Seen in Six Years
Strong earnings come as tax and infrastructure initiatives that were expected to spur economy have been sidetracked amid Washington infighting
Thomas Gryta
Updated July 30, 2017 7:43 p.m. ET
Profits Defy DC GridlockYear-over-year change in S&P 500 earningsTHE WALL STREET JOURNALSource: Thomson ReutersNote: Latest quarter includes analyst estimates for somecompanies

America’s largest companies are on pace to post two consecutive quarters of double-digit profit growth for the first time since 2011, helped by years of cost-cutting, a weaker dollar and stronger consumer spending.

Earnings at S&P 500 companies are expected to rise 11% in the second quarter, according to data from Thomson Reuters, following a 15% increase in the first quarter. Close to 60% of the firms in the index have reported second-quarter results so far.

Corporate America’s strong earnings performance comes as several policy initiatives that were expected to help boost companies’ bottom line—corporate-tax cuts and increased government spending on infrastructure—have been sidetracked amid political infighting in Washington, D.C., which culminated with the recent failure of the health-law bill.

Net GainsChange in earnings from a year agoTHE WALL STREET JOURNALSource: Thomson ReutersNote: Figures include analyst estimates for some companies.

S&P 500TechnologyFinancialsIndustrialsHealth CareUtilities-5%05101520

Even as activity inside the Beltway bogged down, the markets have been on an almost nonstop rally since the election. The S&P 500 is up 16% since early November and 10% this year.

“You could argue that the stock-market investor overestimated Trump but underestimated earnings,” said Christopher Probyn, chief economist for State Street Global Advisors.

The second-quarter profit gains are spread across industries from Wall Street banks to Detroit’s car factories to Silicon Valley’s software labs. Earnings are expected to decline only in the utilities sector, according to data from Thomson Reuters.

Several factors are at work, analysts and economists say. A weaker dollar has made it easier to sell U.S.-made goods overseas and has kept borrowing costs low. U.S. wages have improved enough to help bolster consumer spending without raising employer labor costs so much to dent the bottom line.

Companies also continue to reap the fruits of their recent zeal for cutting costs, Mr. Probyn said. “We underestimated some of the cost-cutting and restructuring that has gone on within the various industries; that has permitted earnings to keep doing well.”

Sales, too, rose in the quarter, by an expected 5%, the second-biggest increase in more than five years, according to data from Thomson Reuters. The figures reflect actual results for about half the S&P 500 index, and analysts’ estimates for those that had yet to report results as of Friday.

Helping to boost earnings: Wage growth strong enough to fuel consumer spending without raising labor costs so much that it hits profits. Photo: Luke Sharrett/Bloomberg News

On Friday, the Commerce Department reported that gross domestic product rose at a 2.6% rate in the second quarter, up from 1.2% in the first quarter.

Executives say even rapid progress on a tax rewrite or an infrastructure bill is unlikely to help improve profits soon.

“We’re halfway through the year, and they haven’t done [tax overhaul],” Christopher Nassetta, CEO of Hilton Worldwide Holdings Inc. said last week. “We’re not going to have enough time for it to trickle through and really benefit this year.”

On an investor call earlier this month, James Dimon, chief executive officer of J.P. Morgan Chase & Co. said: “We’ve been growing at 1.5% to 2% in spite of stupidity and political gridlock because the American business sector is powerful and strong and is going to grow regardless.” Mr. Dimon has made several comments about the need for bipartisan policy revamps.

The White House didn’t respond to a request for comment.

“Political and policy uncertainty continues to weigh on health care, taxation, regulation and trade,” Debra Cafaro, chief executive of Ventas Inc., a real-estate investment firm specializing in senior housing and health-care property, said Friday. “Washington has been wildly unpredictable.”

As executives discuss results with investors and analysts, events in Washington have faded into the background. S&P 500 companies that mentioned President Donald Trump or his administration during their latest conference calls are down by a third compared with three months ago, according to an analysis by research firm Sentieo.

The market has also largely stopped reacting to blow-by-blow developments in Washington, despite uncertainty over the size, shape and timing of any tax and infrastructure initiatives, said Quincy Krosby, chief market strategist with Prudential Financial Inc.

Last week, congressional Republicans and the Trump administration outlined some plans for tax changes to cut individual and corporate tax rates “as much as possible” with a timeline to advance legislation this fall. Many specifics aren’t yet known. President Trump has also promised to put $1 trillion toward infrastructure, likely from a mix of private and public funding, although details remain unclear.

Corning Inc. CEO Wendell Weeks, who was at the White House this month to announce new U.S. investment and hiring, told analysts last week that he still expects Congress to overhaul the tax code—eventually.

“What I am much less confident about is how the political math works in any given year,” Mr. Weeks said. “So I think calling timing on that one is above my pay grade.”

Honeywell International Inc. CEO Darius Adamczyk earlier this month said he hoped lawmakers would advance plans for revamping the tax code as soon as the current quarter. Still, he isn’t counting on it.


Honeywell CEO Darius Adamczyk, right, at the White House last month. ‘I can’t let that sort of rule the business,’ he says about the uncertainty over revamping the tax code. Photo: jonathan ernst/Reuters

“I think there’s more uncertainty in that now than maybe even before, so I can’t let that sort of rule the business,” Mr. Adamczyk said.

That uncertainty could make it difficult for companies to sustain robust earnings growth, said Omar Aguilar, chief investment officer of equities for Charles Schwab Investment Management.

Companies are reporting solid cash flow, but capital spending has been weak until recently. Uncertainty over tax policy may exacerbate that reluctance to invest, Mr. Aguilar said. “Tax reform is clearly what the future may require for these numbers to continue on the same pace.”

Evan Greenberg, CEO of insurer ChubbLtd. , told investors last week that the U.S. badly needs a tax-code overhaul and higher government infrastructure spending to remain competitive.

“But an awful lot of this requires legislation, and we need an administration that is focused, that is working with Congress,” he said in a conference call. “And we need a Congress that comes together to address these issues of our country.”
 

SlugSlinger

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Or what about this:

Caterpillar crushes earnings, boosts its outlook for the rest of the year
  • Jul. 25, 2017, 7:46 AM
  • 2,302
static1.businessinsider.com_image_58ff359f7522ca1b008b5fae_53827fbade50dc90053765c73bf757efa0e.jpg
Thomson Reuters
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Caterpillar has smashed Wall Street's profit estimates and raised its full-year forecast for the second time, driven by improving demand in China and a recovery in mining activity.

Shares of the world's largest construction and mining equipment maker rose 5.6% in premarket trading on Tuesday.

Caterpillar's strong results underscore a turnaround in its main businesses that have been hit by low commodity prices and slowing demand in the past few years.

"While a number of our end markets remain challenged, construction in China and gas compression in North America were highlights in the quarter," CEO Jim Umpleby said in a statement.

"Mining and oil-related activities have come off of recent lows, and we are seeing improving demand for construction in most regions."

Total sales rose by 9.6% to $11.33 billion and handily beat analysts' average estimate of $10.93 billion, according to Thomson Reuters I/B/E/S.

Sales from Asia Pacific, Caterpillar's third-biggest market, jumped 23% in the quarter, boosted by an increase in construction equipment sales in China.

Demand for construction equipment in China is gaining momentum after bottoming out last year, driven by a Beijing-backed infrastructure push, a housing boom, and increased investment linked to China's modern-day "Silk Road."

Sales in North America, its biggest market, were up 7%, largely because of improving demand from the mining and energy industries.

US industrial companies are expected to gain from President Donald Trump's pro-business proposals on infrastructure spending and tax cuts, but a political gridlock in Washington has stalled those plans.

The resource industries business, which makes mining equipment, reported the biggest jump in sales in the quarter compared with a year earlier, led by Asia Pacific.

Caterpillar said it had raised expectations for 2017 adjusted earnings to about $5 a share, up from the $3.75 it had previously forecast.

The company lifted its full-year sales and revenue forecast to a range of $42 billion to $44 billion from its previous forecast of $38 billion to $41 billion.

Net income rose about 46% to $802 million. Excluding items, Caterpillar earned $1.49 a share, handsomely beating the average estimate of $1.26 a share.

Caterpillar's shares were up 5% at $113.48 in premarket trading. Up to Monday's close the stock had gained 16.6% this year, outperforming the Dow's 9% rise.
 

TerryMiller

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Please explain how Pres. Trump is responsible for this.

A study of economics would show that the change in the business climate from Obumba's to Trump's term would be the cause. In case you missed it because of all the "Russia" nonsense, regulations against businesses are being rolled back or eliminated. That alone would have an effect on the business climate. Now, it they were to get a real tax reform bill passed and signed, that would have an even more immediate effect on the economy.
 

Dave70968

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A study of economics would show that the change in the business climate from Obumba's to Trump's term would be the cause. In case you missed it because of all the "Russia" nonsense, regulations against businesses are being rolled back or eliminated. That alone would have an effect on the business climate. Now, it they were to get a real tax reform bill passed and signed, that would have an even more immediate effect on the economy.
So...a few minor regulatory changes happen--but nothing major, which would require action from the Congress--and suddenly Trump is the Great White Hope?

The Kool-Aid line forms to the left. Also, your reference to him as "Obumba" is terribly erudite; congratulations on your great literary achievement!
 

Dale00

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22 billion in reduced regulatory costs for businesses...or so I have seen asserted.

It was odd that a seemingly boring campaign line calling for fewer federal regulations would win applause, but candidate Donald Trump's promise was cheered so loudly last year that President Trump made it an early priority in his administration.

And it appears that he is delivering big time, especially on his pledge to kill two regulations for every new one issued. According to a tally provided by the free-market Competitive Enterprise Institute, the president has issued fewer rules than any other president since Ronald Reagan and cut the costs of those regulations significantly.

The American Action Forum, a conservative think tank that charts federal policy and rules, called Trump's regulatory freeze "historic."

CEI's Clyde Wayne Crews Jr. said federal agencies haven't seen such a shift away from red tape since former President Ronald Reagan arrived in Washington in 1981.

Through last Wednesday, Trump has issued 1,063 rules. During the comparable period, former President Barack Obama issued 1,139 rules.

But Crews pointed out that in government, it takes a rule to kill a rule, so Trump's impactful new rules are likely much lower. "Since rule reductions look like rules, too, the reduction in regulation under Trump is more dramatic than what the raw counts can depict," Crews said.

From his report provided to Secrets:

Trump's mode so far is regulating bureaucrats rather than regulating the private sector, with rules to limit their rules. Even more importantly, more unswervingly than any other, the administration has incorporated regulatory dark matter into reforming the administrative state in both his freeze and the two-out requirement. This material consists of all the memoranda, guidance, notices, bulletins and other proclamations (including threats and bad publicity) with which bureaucrats create or influence policy, but that escape the (already inadequate) discipline of the 1946 Administrative Procedure Act.

All this seems significant in terms of history of the regulatory state. The drop between Clinton and Bush was dramatic, but otherwise last time we saw anything comparable to today's reduction was when both regulations and Federal Register page counts dropped over a third under Reagan.
http://www.washingtonexaminer.com/t...t-in-regulations-since-reagan/article/2625451
 

Shadowrider

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So...a few minor regulatory changes happen--but nothing major, which would require action from the Congress--and suddenly Trump is the Great White Hope?

The Kool-Aid line forms to the left. Also, your reference to him as "Obumba" is terribly erudite; congratulations on your great literary achievement!

If you care to research it some, you'll find the Wall Street turnaround actually started before he was even sworn in. You'll find that but it won't fit with your narrative though...
 

Dave70968

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If you care to research it some, you'll find the Wall Street turnaround actually started before he was even sworn in. You'll find that but it won't fit with your narrative though...
So...changes started before he had any power whatsoever, and that supports the idea that he's responsible for the changes?
 

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