In monopolies we love

July 15, 2009

The market is soaring today largely because chip-maker Intel reported better than expected earnings and Goldman Sachs bested even the most optimistic earnings predictions. But is it any shock that these two defacto monopolies would produce outsized earnings.

Even in a crummy economic environment, companies that dominate their sectors can do well. And that appears to be the case with Intel and Goldman. Of course, Goldman is getting a big hand from Uncle Sam. But that’s the subject of another blog post.

I suppose the market dominance demonstrated by Intel and Goldman is good for┬áthe shareholders of those┬ácompanies. But investors shouldn’t read anything broader about the health of the economy from each company’s respective earnings announcements.

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