Friday, January 30, 2009

Profit and Loss...

2008 was a year for the record books for American businesses. First, the loss leaders: the financial sector, which went belly up last fall. They became the beneficiaries of Paulson's trillion dollar rescue plan. And then after receiving hundreds of billions of dollars from the feds, the bankrupt businesses gave out billions of dollars in bonuses to their employees, rewarding them for God knows what.

Next, let's take a look at the profits seen in 2008 - and yes, there were profits to be had - especially if you were in oil. Today, Exxon Mobil reported a record profit of 45.2 billion for last year. That's right, in a year filled with bankruptcy, Exxon broke its own record for profits.

Here's what the Associated Press has to say about this bounty:

"The extraordinary full-year profit wasn't a surprise given crude's triple-digit price for much of 2008, peaking near an unheard of $150 a barrel in July."

Now, however, prices have fallen 70 percent since then, a welcome relief to consumers, but surely a profit-pinching scenario for Exxon. I'm not too worried about them, though. Even though revenue fell slightly more than 25 percent in the most recent quarter, the per-share and revenue results for Exxon exceeded Wall Street forecasts.

And hopefully, they've put some of that record-breaking profit aside for the rainy days ahead.

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