Update: Capex BOOMs, PMs To Benefit

TOPICS OF INTEREST

Expected “BOOM” in Corporate Capital Expenditures in Q3/Q4 2010

PROGRAM MANAGERs AND PMOs GET READY!

Companies spend--and PMs are busy--when business leaders are confident, can borrow, and better yet have cash burning a hole in their pockets.

Today’s hefty improvement in March Leading Economic Indicators (LEI + 1.4% m/m) indicates strong economic growth locked in for the second half of this year.   

Leading Economic Indicators Index in U.S. Rose 1.4% (Update1) April 19 (Bloomberg) -- The index of U.S. leading indicators rose in March by the most in 10 months, a sign the “It’s one of the indicators signaling a very rapid pace of expansion,” said Zach Pandl, an economist at Nomura Securities International Inc. in New York, who correctly forecast the gain in the leading index. The figure “certainly offers hope that the recovery may be more swift,” he said.   Bloomberg, http://www.bloomberg.com/apps/news?pid=20601068&sid=a.0XkrluprO4

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Other tea leaves to consider . . . 

• First quarter profits easily exceeded expectations (albeit against a very low base) and robust profit growth is expected throughout 2010. 

• Stable debt markets and rising equity markets deliver a relatively low cost of capital, suppressing the hurdle rate projects must pass to gain funding.  

• Corporations are sitting on an unprecedented mountain of cash.  And everyone knows, CASH IS KING!

 In sum we could all be very busy very soon.