Second-quarter earnings have been, once again, good. Heck, we’ll even say great, after all, a 42% growth rate doesn’t come around every day (or quarter, as the case may be.) But the story behind that growth rate, as it has been the past two quarters, is more about easy comparisons to last year’s dreadful results and margins, the difference between a company’s costs and sales. Companies have been making the very most of their sales by keeping their costs down (i.e., your salary, Mack. Or your job.)
Somehow I think companies can play this game longer than people suspect. They may even be able to play it until sales actually do pick up. But don’t be fooled into thinking that because earnings “look” so good, that they’re telling you something about the economy.
(That “breakdown” reference in the headline makes me think of something like this.)
