Reading tea leaves and headlines

Posted: July 16, 2009 in Economics

The headlines in Thursday’s New York Times give force to the notion that the recession is, if not ending, not getting worse.  Employment is always a lagging indicator and there is no good news on that front but leading indicators such as profits at investment banks and some good profit news from tech heavy weights are reasons for hope.

The headlines most interesting to me:

Google’s Profit Surges as Advertising Stabilizes

IBM Raises Guidance, Profit Blows Past Forecasts

JPMorgan Earnings Soar as It Finds Profit in Slump

That’s all good but it helps to keep in mind that the bad news of earlier quarters was built into these items.  In other words, some of these reports had as their foundations steep loses or small forecasts from the beginning of the year.

Most interesting to me is the Google and IBM news.  These items suggest some thaw in a long winter in the tech sector and give reason for optimism that the second half of the year may be better that the first.

So, what did you think?

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