Globalization: What We Could Learn From Caterpillar

The media are painting a picture of doom & gloom. If we believe the newspapers and the leading Internet channels then things are getting worse and worse. But many companies which are now reporting their numbers from the fourth-quarter 2011 and their guidances for this year are painting a different picture.

Take for instance Caterpillar (finance.yahoo). This morning the blue-chip heavy machinery maker reported that in Q4 revenues (construction and mining equipment) climbed 34.6% Y/Y, earnings jumped 58% (reuters.com). Caterpillar's results cap a record 2011 in terms of revenue and profits, and it posted its biggest yearly growth rate for sales and income since 1947, writes Reuters. The world's sales leader in bulldozers, excavators and other earth-moving machinery also predicted that demand for its construction and mining equipment will remain strong this year despite the slow recovery for construction in the U.S. and Europe, reports Bloomberg  (bloomberg).

The industry bellwether said it is more optimistic than it was three months ago that a global recession won't occur in 2012 and expects the threat of a recession in Europe from the sovereign debt crisis to ease by the middle of the year, quotes the Wall Street Journal (.wsj.com). The company anticipates the global economy expanding 3.3% this year, modestly better than in 2011.

It seems that the multinational corporation benefits from the growth in emerging markets and a construction boom in China, India and other uprising countries.

This data fit to the message that the durable goods orders in U.S. climbed 3% in December and were 10% higher than a year before (bloomberg). It seems that manufacturing in the U.S is getting stronger, thanks to the solid global economy, especially in the emerging markets.

Disclosure: I don´t have any position in caterpillar.