Weekly Wrap

Will the big profits of 2013 continue this year?

Lizzie O'Leary Jan 3, 2014
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Weekly Wrap

Will the big profits of 2013 continue this year?

Lizzie O'Leary Jan 3, 2014
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Marketplace’s Lizzie O’Leary, Leigh Gallagher of Fortune Magazine, and Felix Salmon of Reuters looked back on the huge gains in the stock markets and corporate profits in 2013 and whether we can look forward to workers — as well as corporations — sharing in the good fortune this year.

Gallagher says most analysts predict stock prices to continue to rise for at least part of 2014, but it won’t all be smooth sailing:

“One thing that has been totally absent in this past year has been volatility. We forgot what it’s like to be jerked around so much. Three percent gains, three percent drops — it was just gone this year, so I think we’ll see a little bit more of that.”

Salmon agrees that profits will probably continue to rise, but wonders whether the rest of us will see some benefit as well:

“A much bigger proportion of the total economy is corporate profits than we’ve ever seen before, and so the big question for 2014 is, ‘are workers going to get back some of those profits, in which case earnings are going to go down and the stock market will probabaly go down too, or are companies going to continue to make these insane profits?’ In which case the stock market is looking perfectly well-placed right now.”

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