Another WTF Chart

Tyler Durden's picture

Forget the papered over cracks of manufactured EPS 'beats', or the talking-head anecdotes of one or two companies chosen to represent the 'earnings season' visibility. This chart from S&P shows the simple reality that operating earnings per share has been growing at an ever-decreasing pace since QE began. Of course, just as they were saying in June 2011, the next few quarters will see this growth re-accelerate...



(h/t Brad Wishak)

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A_Dog's picture

Are you saying that we should buy more?

TheCanadianAustrian's picture

Clearly nowhere to go but up from here.

idea_hamster's picture

Thank goodness for that red arrow -- I wouldn't have been able to follow the trend!

Skateboarder's picture

Some signs save lives, friend.

Icy when-, I mean, ponzi when debt.

Manthong's picture

Why would there be a concern?

I don’t think earnings quite kept up with stock prices in 1921 Germany, either.

McMolotov's picture

It looks like we're gliding in for a nice, gentle landing. Unfortunately, there's a brick wall just off to the right side of the chart.

Citxmech's picture

Reality has become just like the "Careerbuilder" monkey commercials.

Poetic injustice's picture

More like a minefield. Wall leaves you dead, and that's it. Minefield makes grand explosions hitting everybody.

AlphaDawg's picture

Would not want to be last man outta stawkes

AlphaDawg's picture

Anyone who thinks interest rates going up or qe reduced..,.. No chance...... Your best investment would be an ak47

Jack Napier's picture

AK47 isn't very accurate. I prefer Bushmaster.

Agree, they can't raise rates. They would have to stop QE and raise rates to match inflation just to get back to zero point. TBTF banks would default and take down the derivatives long before then. No choice but to print or reset.

Abi Normal's picture

Nice ski slope...Eddie the Eagle would love to attempt a new world record jump!  Talk about the law of diminishing returns...ugh, that is plain FUGLY!  How much time till the SHTF again?

Panafrican Funktron Robot's picture

Indeed, real growth had it's final coffin nail in the wake of 08/09, being long the market at this point is basically just a bet on continued devaluation to keep your real ROI at or very slightly above zero.  Ie., you're basically choosing to have your wealth tied to the whims of the Fed.  Good luck with that, folks.  

1100-TACTICAL-12's picture

What happens when QE is stopped ? Or can it be stopped ?

Skateboarder's picture

You remember the charts of what QE effects look like. The effect of QE follows the sinc function. The first wave makes the biggest dent, and diminishing returns following.

AlphaDawg's picture

Can't happen as bond yields would spike and the gov would have to default...... simple as,............

Keynesian Mess's picture

I would recommend you ask that question of the heroin addict that stopped cold cold turkey ... but he unfortunately died.  You can't take the needle out, you can only get a bigger needle.

Dollar Bill Hiccup's picture


Bizarro market.

101 years and counting's picture

Thats what QE is for.  If people had to actually use their brain and find a solid reason to hold this market, they'd be selling as fast as possible.  QE gives them the false hope that there is a reason to be long this massively over-inflated "market". 

Conman's picture

Just buy and hold, 2022 is going to be a helluva year.

EmmittFitzhume's picture

I don't think the Algos know the term WTF.

ptoemmes's picture

Perhaps not, but they sure know how to create WTF moments - like yesterday.

LetThemEatRand's picture

Very bullish that it is not declining at a faster pace.

ParkAveFlasher's picture

Nothing a little CTRL-P couldn't fix.

Black Markets's picture

QE started before 2011.

I call statistical fudging. Why not show 2008 to 2013??

ZH is really dropping the ball when it comes to unbiased journalism.

We might as well watch Jim Cramer.

ParkAveFlasher's picture

I double-dog dare you to go watch Cramer and move on his marks.

Skateboarder's picture

I triple-dog dare you to dump all your money into CDs. =P

espirit's picture

You are very welcome to do so. See-Ya, bye, adios, etc.

derek_vineyard's picture

i prefer monkeys throwing darts than cramer

McMolotov's picture

I prefer monkeys throwing darts at Cramer.

Keynesian Mess's picture

Best LOL moment of the day.  Thanks McHilarious!

haskelslocal's picture

So companies are earning less?

It is proven in this chart?

Yet the market is up?

That would imply a growth stock type of environment. So is it safe to say the S&P is all growth stocks created by QE4EVA?

espirit's picture

As I posted to Doc in a relevant way awhile back was:

A WTF chart (moment) nowdays is one that reflects fun-da-mentals.

Edit: Everything else is the "new normal".

NoTTD's picture

Clearly, the bottom is in.  Buy!  Buy!!  Buy!!!

Uncle Zuzu's picture

If you extend the red arrow on the same trajectory, it will eventually point upwards. BUY !!

TumblingDice's picture

LOL it's almost as if QE "stimulus" is producing diminishing returns. Who whudda thunk?

espirit's picture

+1 That's actually pretty good.

yogibear's picture

Seems like Bernanke and the Fed transformed this Japanese style. More debt, bailouts and spending. Oh, the lost decades.

broken87's picture


Dr. Engali's picture

There is no inflation. It'a all transitory.

lolmao500's picture

In another WTF news...

Japan refrains from backing joint statement against nuclear weapon use


Urban Redneck's picture

Perhaps they've also been printing yen is Peshawar, since the ISI-CIA relationship has turned into such a gay soap opera??? WTF is right.

monad's picture

3 more years...

espirit's picture

If this shit last 3 moar years, I'm gonna become a bluepill dealer.

GeezerGeek's picture

Does my Medicare Part D cover bluepills? Gotta check that out...