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What did we learn from yesterday’s earnings from FedEx? The economic bellwether says the recovery is still moving forward nicely (via Seeking Alpha):

We’re very optimistic about future earnings. The dynamics of global trade appears solid, although the impact of volatile fuel prices and other global events remains uncertain. Our optimism is based on three factors: One, our business strategy to profitably grow our international business, improve our yields, manage our cost structure and make sound investments is working. Second, global macroeconomic trends are driving growth in markets where we have unique, competitive advantages such as the long nonstop flights being flown by our Boeing 777 freighters. And three, the FedEx team around the world is delivering on our Purple Promise: I will make every FedEx experience outstanding. In that regard, we are particularly proud that Fortune Magazine recently rated FedEx among the top 10 most admired companies in the world.

Our businesses are performing strongly in the United States, where industrial production growth is expected to approach nearly 5% in calendar 2011, outpacing GDP and supporting overall transportation volumes. We plan to take full advantage of continued rapid growth in emerging markets as well, which we serve with the largest, most comprehensive air express, air cargo network in the world.

The conference call added some details:

Thomas Wadewitz – JP Morgan Chase & Co

Wanted to ask some questions — ask on the issue of demand in general. We’ve seen some slowing in the heavyweight airfreight numbers out of Asia. Your IP is still growing nicely, but it is decelerating a bit. How do you see that business looking forward? Are you seeing it slow, or is it just a function of considering tough comps looking forward and the way we model volumes?

David Bronczek

This is Dave Bronczek. No, we see strong demand actually running into Q4 here. We have great momentum all around the world, especially in Europe and Asia, U.S. outbound and U.S. domestic. So the weights are strong. As Alan pointed out, IP alone with 15%. IP, IPFS was up 21%. So I think we’re running into Q4 here with great moment.

What do they expect for the broader economy:

T. Glenn

Yes. We haven’t had a material change in the forecast for calendar year ’11. We’re still looking at 2.9% GDP growth. Industry production is just under 5%, as Fred mentioned. Consumer spending, again, just under 3%. If you look at our fiscal year ’12, as we go into that, we’re looking at 3.3% GDP growth, industrial production down slightly from this year. And again, consumer spending around 3%. So not a significant change in that.

On Japan:

Frederick Smith

Well, this is Fred Smith. I’ll ask Dave to comment further. It’s very difficult to ascertain what the effect is going to be. I don’t think in the scheme of things, with a company the size of FedEx, at about $10 billion a quarter, that the net effect of Japan is going to be significant. Now that doesn’t mean that there couldn’t be a lot of money in human terms, but in relative terms to FedEx’s operation. And secondarily, while this thing has been horrific and one of the worst things we’ve seen in a long, long time, the reality is it’s fairly localized. And assuming that there’s no great effect from the nuclear power plant issues, the Japanese are very resourceful people and we’re carrying a lot of traffic out of Japan as we speak. And the trade balance from Japan and to Japan was always much more export oriented there. So there will be more traffic going into Japan from reconstruction purposes than would otherwise have been the case. And of course, there will also be humanitarian relief, and as I mentioned in my remarks, we try to stand up and help people do that because we have a unique capability to do it, and other people in the industry also do that. So I don’t think that Japan will be significant overall. There may be some pinch points in various supply chains and have some effect on automotive or high-tech production. But the Japanese are very able folks, and I think the way ‘they’ve handle this thing is also very admirable. I might add, and on our board, we have Doctor Shirley Jackson, and Doctor Jackson’s the head of the Rensselaer Polytech. And she was also the head of the nuclear regulatory commission, and we coincidently had our quarterly board meeting on Monday. So one of the most interesting things we’ve had in a long time was to listen to her educate us with about the situation in Japan. And I think the likelihood is that the effects of the nuclear situation there are more probably less rather than more, unless there’s some drastic, unfortunate convergence of events takes place.

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