More Bullish News From JPM and GE
JP Morgan (JPM) announced better earnings helped by loan losses. Since I don’t believe big banks are particularly honest or great indicators of a better economy I only take snippets from their earnings. I gloss over trading and investment banking all together. What I did see was that lower loan losses and a smaller amount put into reserves is helping results. What that means is they’re more confident about getting paid back by borrowers and seeing less borrowers default.
The other news for the day came from GE. Jeff Immelt, their CEO, said he was increasing R&D spending 18% and staking the companies future on growth from R&D. This is great news. Companies are tepid about spending R&D dollars if their uncertain about the future so this shows me that he is ready to put money to work building the foundation of new businesses. R&D leads to capital spend which leads to increased output which leads to jobs. All great indicators.
Disclosure: The Mayor has no position in JPM or GE.