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Expand chart
Data: Federal Reserve Bank of St. Louis; Chart: Chris Canipe/Axios

Companies had a stellar second quarter: profits rose more than 16 percent from last year, according to the Commerce Department. That's great news, right?

Reality check: Look at corporate profits as a share of the economy. That figure is nowhere near its 2012 high point. In fact, the number has not changed that drastically in the last few years.

What's next: The rosy earnings season helped propel stocks to record highs, but some market watchers think the good times won't last. "I really think the big story 6 to 9 months from now is going to be the colossal decline in earnings growth," said Jim Paulsen, chief investment strategist at The Leuthold Group, a research firm.

Here are a few factors that might derail the corporate boom:

  • Waning tax cut benefit: Tax cuts automatically boost earnings, but it's much harder for them to boost earnings growth.
  • Rising rates: Consumer spending sent inflation to a six-year high, which makes more of a case for the Federal Reserve to continue its plan to raise interest rates. The luxurious years of low corporate borrowing costs might be coming to an end.
  • Tariffs: Fears of an escalation of the trade war were a common theme this quarter. Jack Daniel's maker Brown-Forman trimmed its earnings forecast for the year, thanks to the trade war. Retailers, too, are monitoring the situation closely.

Go deeper

Reddit traders look to pummel Wall Street's old guard

Illustration: Sarah Grillo/Axios

Reddit traders are taking on Wall Street pros at their own game with this basic mantra: Stocks will always go up.

Why it matters: Their trades — egged on in Reddit threads — have played a role in historic market activity in recent days.

The week the Trump show ended

Data: NewsWhip; Chart: Andrew Witherspoon/Axios

Donald Trump was eclipsed in media attention last week by President Biden for the first time since Trump took office, according to viewership data on the internet, on social media and on cable news.

Why it matters: After Trump crowded out nearly every other news figure and topic for five years, momentum of the new administration took hold last week and the former president retreated, partly by choice and partly by being forced off the big platforms.

Pay TV's bleak post-pandemic outlook

Data: eMarketer; Chart: Axios Visuals

The pandemic has taken a huge toll on the Pay-TV industry, and with the near-term future of live sports in question, there are no signs of it getting better in 2021.

Why it matters: The fraught Pay-TV landscape is forcing some smaller, niche cable channels out of business altogether.