State of Business: The Profits Paradox

In last week's flood of first-quarter earnings reports, corporation after corporation told a happy-sounding story. Taken as a whole, every major U.S. industry had done better than in the recession-bound first quarter of 1961 and record dollar earnings were frequent. Among the most successful:

AUTOS. With first-quarter auto sales the highest since 1956, Detroit set up a happy babble. Loudest voice in the chorus was that of General Motors, which reported a record first-quarter net of $374 million —up a whopping 99% from last year. Also at an alltime high: G.M.'s...

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