UPS logo on the side of a delivery truck
UPS logo on the side of a delivery truck - 
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JEREMY HOBSON: You may have noticed that we are currently in the middle of corporate earnings season. It happens every quarter -- public companies tell us how they did last quarter, and how they expect to do in the coming year. Today, we'll hear from Pepsi, Phillip Morris and Expedia. Yesterday, Cisco told us cash-strapped governments are ordering less network equipment so the company's profit is down 18 percent.

Well to make sense of all the numbers that are coming in, let's bring in Marketplace Economics Correspondent Chris Farrell. Hi Chris.


HOBSON: So we're getting earnings from everyone, from McDonald's to Northrop Gruman. What companies should we be paying attention to get a good idea of how the economy's doing?

FARRELL: I would pay attention to UPS, the brown trucks. It's a bellwether; packages delivered everywhere. Fourth quarter earnings up 48 percent. This is a stunning number. And then if you look at the holiday season -- and this is why I really love earnings reports -- they delivered 440 million packages. What this signaled is the online retailing world has truly taken off. It gives us an indication of what our economy is doing and where it's going.

HOBSON: All right, so shipping, that's an important one. What else are you looking at?

FARRELL: Well we know that we shored up the banking system, right? Because of the big banks' collapse, we've had a lot of economic trouble? Well Wells Fargo is doing much better. If you look at their earnings report, here's the thing that I liked: Wells Fargo is doing pretty well across the board in its loans, but its highlighting that it believes the real opportunity is in commercial loans. And that's what we really want to see: some business borrowing.

HOBSON: So shipping, finance -- two important sectors of the economy. You seem pretty optimistic about both. How about a third for good luck?

FARRELL: This is I guess the optimistic couple of minutes here. We're going to Emerson Electric. The manufacturing sector's doing well. When I listened to the webcast after their earnings and they're saying that the wind is to our back. But here's the other thing: they emphasized inflation. They are seeing big increases in material prices and they're really worried about inflation going forward.

HOBSON: And that's something that a lot of companies are worried about, whether it be food companies or energy companies. Marketplace economics correspondent Chris Farrell, thanks so much.

FARRELL: Thanks a lot.

Follow Chris Farrell at @cfarrellecon