Hounded by Evil Dollar & Collapsed Commodity Prices, Corporate America Clamors for Total Currency War
Consumers are feeling practically euphoric. The Conference Board index jumped almost ten points to 102.9, the highest since August 2007, just before the whole construct came apart. Not that reality has suddenly improved that much. But hey, we’re born survivors. Sooner or later, we adjust to lower real incomes and reduced standards of living and start feeling good again.
This exuberance came just as our largest corporate citizens were hit by a tornado of problems that sank the stock market for the day: currency volatility, crashing commodities prices, disappearing XP computers, farmers switching from corn to wheat…. It was all there.
Freeport-McMoRan, one of the largest copper producers in the world, reported an 11% drop in revenues for the fourth quarter and a salty $2.85 billion loss, which included $3.4 billion in losses for its oil and gas business that it got into via two impeccably-timed acquisitions in 2013. The depressed price of copper isn’t helping. It cut its 2015 budget by $2 billion and might cut it some more. Shares dropped 6%.
Long-suffering Peabody Energy, the largest coal producer in the US, reported a net loss for the quarter of $566 million on revenues that declined 3.3%. It projected a much wider loss than expected for the first quarter and cut its dividends to nearly nothing. It’s all about preserving cash and hanging on in a desperately tough pricing environment for coal producers. Shares dropped 6.5% to $6.24, down from $72 during the glory days in early 2011.
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