Earnings has been, on the whole, very positive. Some pundits and financial blogs have expressed the idea that its not really difficult to outperform when estimates have been significantly reduced and the income saved from not having to pay all the folks that were laid off. Certainly has to be some truth to that, but it's important to keep in mind how far the economy's come in the past year. The markets just bounced back, there has to be some type of corrective pause. We must also keep in mind China's attempts to take the punch bowl away, which seem to have been relatively successful.
Industrial Metals continue to see increased demand, and prices are hitting new highs. This can only bold well for the miners, but more importantly it bodes well for global expectations of growth. As for tech, the continued appetite for smart phones worldwide will increase the profitability of chip makers, companies like HTC, telecoms, and other well-known companies. Even if the economy goes sideways for some time, it will continue to improve.
Finally, and here is the big one, America's Healthcare industry is going to grow at an incredible rate over the next ten years. Say what you will about the new Health Insurance law, but bringing millions of people into the healthcare system is going to benefit everybody. Of course, insurance companies will benefit simply b/c they have more people to screw over. Hospitals will have a higher likelihood of getting reimbursed, drug companies will have more prescripitons to sell bc the insurance will allow more consumers, pharmacies will gain increased clientele, shippers will be moving more health products, etc. The demand curve has been pushed to the right, and over time supply will catch up. Technicians, nurses, doctors; as the baby boomers age a powerful incentive will provide for higher rates of employment. America will be the biggest exporter of health services in the world; this is a field where we can have a comparative advantage.
Perhaps that's too rosy an outlook, or perhaps I'm too young. But my boss is fond of saying, "America can hold its breath longer than anyone else." We shouldn't underestimate ourselves. Man, I'm ready to get back in.
