2012 Economic Recovery?

It’s July 1st, and that means that the second quarter just ended. Recent economic data suggest that the housing market might finally be improving a little bit. Recent jobs data suggests that the labor market is at least holding its own, even though it isn’t strong enough to be lowering unemployment yet. How companies report their second quarter earnings will go a long way toward showing whether or not the economy will finally move forward faster than a snail in 2012.

Economy Improving?

Here is what to look for.

Companies should report earnings that are pretty much in line with how well they did in the first quarter since there were no real up or down catalysts in the second quarter. However, what you really want to be looking for is the guidance that companies are giving for the next quarter and the rest of the year.

If companies feel good about the rest of the year, that means that they are more likely to spend, or at least not cut. That additional economic activity is what this economy really needs to kick it over this hump because consumers are tapped out.

A solid third quarter with rising expectations heading into the holiday shopping season will be just what the doctor ordered for the U.S. economy.

Now, if we can just keep the politicians in Washington from screwing it up as they deal with the so-called Fiscal Cliff coming January 2013, we can be back in business.

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