[Rhodes22-list] Economics

[Brad Haslett]

Ben,

A correction is a correction.  Real estate is overpriced in the short term
and the business cycle is what it is, it doesn't go away by legislation or
other means.  The good news is that the energy market is due to fall
- Hillary will have to go steal from somewhere else.  I invest long term in
diversified funds and forget about them.  The last ten year average has been
about 11%.  I'll never be wealthy but won't go hungry either.

Brad


On 3/22/07, benonvelvetelvis at theskinnyonbenny.com <
benonvelvetelvis at theskinnyonbenny.com> wrote:
>
> 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*
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