[Rhodes22-list] Economics

[benonvelvetelvis at theskinnyonbenny.com]

I would think that the economically predictive piece of this is positive.  Revenue growth is up, and ground shipping revenue is significantly up.  My read is that shipping of goods is all well.

Stinks that profit growth isn't keeping pace with revenue, but when costs rise -- fuel has to be bought -- that's what happens.

I wouldn't start moving the retirement funds to bonds just yet.

Ben

-----Original Message-----

From:  "Brad Haslett" <flybrad at gmail.com>
Subj:  [Rhodes22-list] Economics
Date:  Thu Mar 22, 2007 8:48
Size:  3K
To:  "The Rhodes 22 mail list" <rhodes22-list at rhodes22.org>

Hunker down boys and girls and protect your investments - the sky isn't
falling but we're going to have a low ceiling for awhile.  Follow any
benchmark you want but this is one of the best predictors out there. The
understatement is "automotive and housing", that is a huge chunk of the
economy and both are going through major corrections. Don't believe that
last sentence, it's boilerplate "the world would be safe if it wasn't for
those damn pilots" bullshit.  Brad

--------------------------------

   Slowing Economy Takes a Toll On FedEx's Quarterly Results
------------------------------

FedEx Corp. reported Wednesday that its earnings dropped 1.9% in the fiscal
third quarter, stung by the slowing economy, lower fuel surcharges and
severe winter weather.

The package-delivery company, which is seen as a bellwether for the overall
economy, also lowered its outlook for fiscal fourth-quarter earnings,
tightening both ends of the forecast range by a nickel share. FedEx also
said that, while its long-term goal remains 10% to 15% annual growth in
earnings per share, growth during the coming fiscal year may fall short
because of the sluggish economy and investments that FedEx expects to make
in its business.

"The U.S. economy grew at a lower rate than we expected in the third
quarter, and we saw continued adjustments in the automotive and housing
markets," FedEx Chairman, President and Chief Executive Fred Smith said in
the press release. "I believe, however, this represents a healthy transition
for the economy as it phases into a more sustainable growth rate.

"FedEx is in excellent position to take full advantage of global
economic-growth trends and deliver overall outstanding financial results in
the long run," Mr. Smith said.

The Memphis, Tenn., company earned $420 million, or $1.35 a share, in the
quarter ended Feb. 28, compared with $428 million, or $1.38 a share, a year
earlier. Revenue rose 7% to $8.59 billion.

The results, which marked the first profit decline for the delivery giant in
more than three years, were at the high end of the $1.20 to $1.35 a share
forecast range the company set in December, when it reported second-quarter
results. Earnings topped analysts' forecasts, while revenue missed
expectations. Analysts polled by Thomson Financial expected, on average,
earnings of $410.1 million, or $1.33 a share, on revenue of $8.7 billion.

FedEx previously said the typical surge in holiday-related freight volumes
was "a bit delayed," the latest sign that a slowdown starting in the summer
and fall at many railroads and trucking companies may be spreading to
package carriers that handle many shipments on the last leg of their
journey.

FedEx's average daily package volume in its express and ground businesses
rose 4% in the latest quarter, compared with the year-earlier period, helped
by growth in international express.

Revenue in the express business rose 3% to $5.52 billion, and revenue in the
ground business increased 12% to $1.52 billion. FedEx's freight revenue rose
30% to $1.1 billion. The Kinko's retail-shipping and office-supply business,
however, continued struggling, with revenue declining 3% to $485 million.

FedEx expects to earn between $1.93 and $2.08 a share during the current
quarter. Its prior guidance had been $1.98 to $2.13 a share. Analysts polled
by Thomson Financial expect, on average, for the company to earn $2.03 a
share during the quarter.

Excluding second-quarter costs associated with the new pilot labor contract
at the FedEx Express segment, the company expects to earn between $6.70 and
$6.85 a share for the year. Its prior guidance had been $6.60 to $6.90 a
share.

*Wall Street Journal*

*3/21/2007*
__________________________________________________
Use Rhodes22-list at rhodes22.org, Help? www.rhodes22.org/list


--- message truncated ---