In late April according to Reuters Caterpillar’s first quarter beat the estimates of Wall Street and its shares rose 7% to the highest it has been in 3 years. The shares rose to $104.42 up $7.62. The company because it sells heavy equipment is seen as a bell weather stock as governments around the world turn to infrastructure spending Caterpillar is a company expected to benefit from the decisions. If you drive and see the yellow machines at work, then that is good for the company. Caterpillar expects 2017 to be better than 2016 with sales and revenues to be in the $40 billion area as opposed to between $35 and $38 billion. Excluding restructuring costs Caterpillar earned $1.28 a share which was twice the estimate of 62 cents a share. Part of the restructuring was shutting down factories and laying off 12,000 workers. The newer plants will have more robots.

A company similar to Caterpillar has three macro areas of support – mining; infrastructure spending (roads and bridges) and construction both home and institutional (government buildings). Ideally under President Trump’s proposal trillion dollar infrastructure spending, the companies doing the work (buy American) would be using the yellow machines of Caterpillar. It should be noted there is a glut of used equipment.

Linking to dividend paying stocks, on the macro side of stocks there is good news and not so good news. The good news is the government wants to create the conditions for business to grow and use its spending power; the bad news is for company such as Caterpillar it had to shut factories and 12,000 people are out of work. Even if there is more work, the workers are not likely to be called back, for Caterpillar expects to be able to meet the demand under the new conditions. With investing there is rarely a black and white issue, many of the issues are grey.

There are more questions than answers, till the next time – to raising questions.