The last long leading indicator, corporate profits, declined in Q4 2018
- by New Deal democrat
Three months after the quarter ended, corporate profits for Q4 of 2018 were reported this morning, and they were down slightly (-0.1%). Here’s the quote from the BEA:
Corporate profits deflated by unit labor costs are a long leading indicator. Since these costs were already reported at +1.6% q/q, that means that adjusted corporate profits were down about the same percentage.
Earlier, proprietors income for Q4 had been reported at positive, but that is a less accurate placeholder. In contrast, Q4 corporate earnings for the S&P 500, with 99.7% reporting, declined over -3% q/q.
This means that, in Q4 of last year, almost *all* of the long leading indicators declined, the first time that has happened since - perhaps not coincidentally - shortly before the last recession.