Recent Revisions to Corporate Profits: What We Know and When We Knew it

7 Pages Posted: 6 Oct 2004

See all articles by Charles P. Himmelberg

Charles P. Himmelberg

Goldman, Sachs & Co.

James M. Mahoney

Federal Reserve Bank of New York

April Bang

Federal Reserve Bank of New York

Brian Chernoff

Federal Reserve Bank of New York

Abstract

Initial estimates in the National Income and Product Accounts significantly overstated U.S. corporate profits for the 1998-2000 period. Subsequent revisions reveal that the profitability of the nation's corporate sector in the late 1990s was substantially weaker than real-time data indicated. An unexpected surge in employee stock options exercised - and perhaps, in some sectors, firms' inflated statements of profit - may help explain the large downward revisions.

Keywords: real-time macroeconomic data, corporate profits

JEL Classification: G10, E20

Suggested Citation

Himmelberg, Charles P. and Mahoney, James M. and Bang, April and Chernoff, Brian, Recent Revisions to Corporate Profits: What We Know and When We Knew it. Current Issues in Economics and Finance, Vol. 10, No. 3, March 2004. Available at SSRN: https://ssrn.com/abstract=601126

Charles P. Himmelberg (Contact Author)

Goldman, Sachs & Co. ( email )

200 West St
New York, NY 10233
917-343-3218 (Phone)

James M. Mahoney

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States
212-720-8910 (Phone)
212-720-1577 (Fax)

April Bang

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

Brian Chernoff

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

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