Corporate profit in US saw huge leap in 2021
SALT LAKE CITY — Adjusted profits for U.S. corporations leaped 25% last year.
MarketWatch reported that it was the biggest jump since 1976.
And DMBA Certified Financial Planner Shane Stewart said it’s unsurprising.
“We took a dip in 2020, so it makes sense that the recovery when it does happen is larger than usual,” Stewart said. “Because we took such a dip when the pandemic hit.”
Stewart also said this means employers are more flush with cash. And that means higher wages.
People investing in a 401K will also help with the long-term recovery.
“As things settle out, your 401K is invested in the market and should help stabilize the market in the long run,” Stewart said. “The American economy and the American people are pretty resilient.”
Stewart also believes this is why it’s appropriate for the Federal Reserve to be raising interest rates right now.
“It’ll be tricky for the next year for the Fed to raise rates methodically and slowly, but it should have the right effect,” Stewart said. “It should slow things down just enough to bring the prices down.”
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