Winning the US companies collapse: CEOs have to take correction measures!
Winning the US companies collapse: CEOs have to take correction measures!
Binz, Deutschland - Oliver Binz, Associate Professor of Accounting at ESMT Berlin, takes a critical look at the economic situation in his current analyzes at the end of the fourth quarter. As is well known, it is customary there that companies have to adapt their final figures up or down. But as he in a Article from Table.media , the profits of the US companies often break up by almost 50 percent compared to the previous quartals. There are reasons for this in distorted estimates for expenses over the year.
Interesting is that the markets still react negatively to the falling figures, even though the operational business of companies remains stable. A discrepancy that CEO’s can bring to the bredouille, because incorrect numbers may lead to over -hastied and inefficient decisions. Ultimately, this situation ensures that the trust of the capital markets suffers, since analysts and investors often cannot understand the logic behind the corrections.
The role of US working market data
With an increase in wages of 0.5 percent compared to the previous month, the labor market exceeds expectations and signals a reserved interest rate policy of the US Federal Reserve. This policy is further supported by monetary policy, since Fed boss Jerome Powell emphasizes before the US Congress that there is no hurry to reduce interest. It is pointed out that premature relaxation of monetary policy could endanger progress in the fight against inflation.
economic developments in Europe
In Switzerland, too, an increase in the unemployment rate to 3 percent, the highest rate since December 2021. Especially in industry, such as mechanical engineering and the watch industry, the economic conditions are tense. Here, the situation of unemployment in the summer of 2023 with less than 2 percent is also a positive abnormality. The forecasts for Western Europe and the global economy indicate growth of 1.1 and 2.9 percent.
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