In another good sign for the economy, Ed Yardeni reported several days ago in his regular research piece, that capital spending for businesses large and small, has improved. “More capital-spending plans. Another upbeat reading from the survey is that 24% of firms have capital-spending plans over the next three to six months, the highest level since November 2008 . Those capital-spending plans are highly correlated with the percent of firms reporting that earnings were higher minus those reporting that they were lower over the past three months. The up/down balance of earnings has recently rebounded back close to the
June 2012 cyclical high, and is consistent with more upside to capital-spending plans by small businesses.” This reading gives us more confirmation that 2014 could
be another good year for the equity markets, as companies spend, and hire.
