Business: Earnings: Hitting Bottom

The recession that has now mercifully ended produced the worst earnings slump since the 1930s: between the third quarter of 1974 and the first quarter of this year, after-tax profits of the nation's corporations plunged 34%. Now there is solid evidence that the decline has at long last hit bottom. Manhattan's First National City Bank reports that during the second quarter, after-tax earnings of 912 large manufacturing firms rose 10% above the first quarter. Profits of nonmanufacturing companies, such as banks, utilities and retail chains, increased 15%.

Some of the biggest profits gains...