Company cost cuts boost profits

[Click to view in browser](. Dear Trader, The market is expanding to new highs on the back of a mysterious phase that is being sprinkled like pixie dust among the conference calls this earnings season: “operating leverage.” A spokesman for Morgan Stanley recently stated that the market is set to see a substantial acceleration in earnings growth on better than expected operating leverage. This is an accounting term that measures how a company can increase profit by decreasing costs and increasing revenue. Simply put, Morgan Stanley’s statement along with others implied expectations that the cost-cutting efforts of corporate America in 2020 - reducing rent, cutting travel, and especially eliminating jobs - will dramatically improve the bottom line and further accelerate profits when revenues are expected to increase in 2021. More revenues + lower expenses = more profit. Corporations try hard to control costs, and [the COVID-19 pandemic]( has forced companies to drastically reduce their expenses. Costs fall into two broad categories: fixed, such as insurance, rent and interest payments, and variables, like energy, materials and labor. Fixed costs rarely change, but variables do. If companies can control variable costs, or turn them into fixed costs, they can usually operate with higher profit margins. In the midst of [earnings]( season, here are today’s top-trending headlines... Power Plays [5 Most Successful Products From Shark Tanks]( Do you know we’re all pooping the wrong way? Science says that squatting is the way to go, which shows that the East may be on to something, as squatting is the preferred method in many countries there. The Squatty Potty is just a footstool which helps you get in a squatting position, and has done... [Read More]( 56035 [This company is on its way to being a market leader in the psychedelic industry]( Be one of the first to invest in this market leader [Click here to read more.]( Sponsored Speculation [Silver short squeeze: the long-term impact on the silver markets]( Although the market swell of Reddit’s leveraged traders has subsided, this week’s action will have a lasting impact on the silver market. With the global… [Read More]( 5721 [2:00PM Water Cooler 2/9/2021]( By Lambert Strether of Corrente. [Read More]( 5270 [How are those China crash predictions working out for you?]( Back in 2010, I did a blog post expressing skepticism about theories that China was in a bubble. I quoted this statement: [Read More]( 579 [Monday Market Momentum – Still Going Up]( That's the new word driving the markets. Of course all this freshly-printed money was eventually going to spill out into the economy but, all of a sudden (after strategy meetings at Davos) all the prognosticators are now spinning inflation as the new reason the markets will go higher and higher. ... [Read More]( 319 [This company has rigs firing up for an 18-hole drill program]( With junior exploration on the rise, you don’t want to miss out on investment opportunity [Click here to read more.]( Sponsored Economics [BIDENOMICS OFF TO ROARING START:]( Shot: [Read More]( 3924 [MBA Survey: "Share of Mortgage Loans in Forbearance Declines to 5.35%"]( Note: This is as of January 31st. From the MBA: Share of Mortgage Loans in Forbearance Declines to 5.35% [Read More]( 307 You are subscribed to email updates from [InvestingChannel](. To stop receiving these emails, you may [unsubscribe]( now. InvestingChannel, Inc., P.O. Box 118 New York, NY 10018. [Link](