It seems
like businesses are having the same kind of mindset as consumers: positive
today, but very wary about the future.
Commercial
and industrial loans are still rising, month after month, since 2011.
But some
cracks are starting to show in the profit margins and the earnings outlook.
Profit margins seem to have peaked in the third quarter of 2018, with no
immediate return to this peak in sight. This is also very nicely visualised
over the long term, supported by clear one-liners that indicate the reason for
these levels of earnings. One can say
that the peak in earnings in Q3 last year was because of the one-time tax cuts,
and are now fully baked in.
Meanwhile,
small businesses are becoming downright negative about the future, with the
largest 2 months decline on record when it comes to answering the question: “is
it a good time to expand”.
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