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The Truth About S&P 500 Earnings: No Growth For 7 Quarters, With A Revenue Recession On Top
With the global economy sliding into recession, the one strawman repeatedly used by straight-to-CNBC pundits to justify some mythical case for US decoupling has been that US corporate profits are "fine." Here is the truth.
As the following table from ISI shows, not only is the US now officially in a revenue recession, with every single quarter in 2015 set to post a decline from the previous year, with even the overly optimistic consensus case of a 4% increase in Q1 2016 revenues unable to regain sales last seen in Q3 2014, but S&P500 expected earnings in Q1 2016 of 119, a 6% increase from the previous year, will barely be back to levels seen in Q3 2014.
As ISI summarizes: "Expected Earnings for the S&P Show No Growth For 7 Quarters And Revenue Declining."
And this with nearly $1 trillion in projected stock buybacks for all of 2015 steadily removing S from the EPS calculation.
All we can add to the above is that if the USD continues its steady ascent, as it did today despite the Fed not hiking, expect ongoing dollar strength and the resulting commodity weakness to depress both revenues and sales even further, until everyone is forced to admit that the S&P500 is already in both a revenue and profit recession.
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Well, I'd like to hear Jim Cramer's take on this. (sarc)
Then my grand-kids could get Stroke & Aneurysm dolls for Christmas
Long amyl nitrate.
No secrets here... The only way corporations have made their numbers with declining revenues is to cut costs and buy back shares, killing Capex and expansion... How do you like the idea of training your replacement, who is a non-union H1B visa holder from Bangladesh?
amyl nitrite there partner, tricky to get hold of, because the pharmacist suspects you're supplying gay nightclubs
Jim said that pointing out falling revenues is 'unsavory'.
Is it any wonder why companies aren't investing in CapEx? I wouldn't either. Just keep buying back those shares until the next crash and then walk away. (They read ZH, too. They know what's up.)
US Economic recovery.
As real as Obama's birth certificate.
There's been nothing about the guy that hasn't been a lie from Day 1. He's the Manchurian Candidate. Only thing he didn't lie about was "fundamentally transforming the country". Sure as shit didn't lie about that. I don't even recognize the place any more.
I hear you on the rest, but I don't think he fundamentally transformed anything. Maybe he sped it up, but the country has been going down the shitter for a long time. 9/11 happened 14 years ago, and the bailout happened before Obama took office. Obama is the worst since Lehman.
Best series of comments in a long time.
How do we unseal his college transcripts? My bet is that there is a lot of extremely revealing stuff there from attendance records, to grades to foreign student status.
He was a crappy student, from all first-hand accounts I've heard. Smart but reluctant to apply himself to the details and boring minutae. He was put in the position of student president of the Harvard Law Review by CONSERVATIVES, who he immediately turned his back on and took sides with the "radicals" that he openly bragged about in his book. More to the point, I think, is who BANKROLLED his education.
Infidels!
Retail is taking a bloodbath the two local dept store managers told me last weekend. Not only are profit margins zippo, but they both complained about the increasing problem of what they call, "shrinkage" or theft of their stuff. Despite cameras, etc it is still pretty easy for people to steal belts, jewelry [a biggie!], shirts and even things like coats! One said his shrinkage rate is way above 8% and it ain't even Christmas time.
Barry has squashed the middle class consumer. I have no idea why he hates the American middle class so much.
Being a crappy student is the only thing going for him. If he flunked keynsian 101 thats no problem. Wasnt worth paying attention to. The man's problem is thinking he is helping america. And he isnt. On any front. Our worst nightmare is that the next guy will be just as bad. Which is what all of them seem to do.
Wanna know what will guarantee Trump as potus..
He just makes a cast iron pledge that he will open the fucking filthy faggot obummer file to the public, photos of him in the bathhouses fucking fat faggot white boys, birth certificate and the rest of the fraudulent lying sack of shits background including the fact that his mother was without question a monkey.
Im sure she was,, either that of his fucking father, cos no way that cunt is the same as me, and human
Heavy crap a flying me buckos!...there is no clear path, real skills will come in handy..and of course a metal detector and a wrist rocket.....learn to use both...that and a plastic tarp are 'bout all a guy needs...
OT, but Koos Janen's latest post (linked below) is well worth a read. Here's a small taste:
Below you can see what I think is a significant screen shot from the BPM6 rulebook. The IMF has put Monetary gold right at the top of the global reserve assets list – above SDRs. The IMF writes, “…The gold bullion component of monetary gold is the only case of a financial asset with no counterpart liability”, and, “7.69 At the appropriate reference dates, reserve assets are valued in the main at current market prices. Monetary gold is valued at the prevailing market price, SDRs are valued at market rates calculated by the IMF, and deposits and loans are valued at nominal values.”
https://www.bullionstar.com/blogs/koos-jansen/the-london-bullion-market-...
Revenues and GAAP accounting are your only friends. EPS and Non-GAAP figures are a joke.
LOL, everything looks bad if you use GAAP numbers, silly! It's why we don't use it...
That's similar to why CPI excludes Food and Energy - 'cause ya know? we don't really need food or energy.
What pill was I supposed to take!? Either way... I think I took the wrong one.
Energy and food are just too volatile to measure any kind of real(snicker) inflation.(giggle) So we just don't count those anymore. (giggle) Next we'll remove housing costs and then we will know what inflation the serfs oh I'm sorry people deal with.
Certifiably crazy, that's the only way I can explain it. Anyone with half of a brain knows that inflation is real and ever-increasing. Every time I hear talking heads, FED, whatever, talk about getting inflation up I go absolutely ape $hit - these people are delusional or intentionally lying. And, my annual salary increase never seems to keep up with annual inflation - I crunch the numbers quarterly!
I don't believe there is any global recession or any thing bad going on. What ever our leaders say is correct and true - I mean, it has to be - they represent US, right?
I trust the government, too. Anyone who doesn't, should get the fuck out!
I trust that the government has its own best interests in mind first over all.
I picked up a "Government" text book the other day in the bookstore. the very first sentnece was, "Always remember the number one purpose of the government is to keep itself in power."
Thank God America has the Second Amendment!
What are the best guesses on Fed actions in October?
I guessed right on this last one. I am going to bet short of a stock crash they raise rates in October. It is not because of any economic analyses or any prime directives. It will be just to pretend they know what they are doing and make a show of being economically balanced. It will be a quarter point so as not to crash the markets and fragile economy.
It's not about science in the end. It will be about posturing and the pretense of being economic and monetary masters.
I was originally thinking Jan 2016 for the same reasoning, but now I'm leaning Nov/Dec, simply because Gartman said "chance of rate rise this year seem very slim".
Oct will be too soon for the China influence to go away completely yet, Chinese stock market is bottoming, but the capital outflow and the fear of a "China collapse" in the west is still ongoing. So that's where I'm leaning Nov/Dec
Goldman has already said it won't be til 2016. So............
Hey James Bulltard and William Dudley, have your banker buddies use more of that Federal Reserve Ponzi money to buy more shares.
We are confident of QE4. Just waiting.... We already know you can't raise rates.
LOL, the 12 little pigs at the Fed keep threatening to raise rates. Never going to happen unless the market does it instead.
Been no growth for about 30 yrs , just deficit spending
The other Ben ~ "No rate normalization in my lifetime."
O'Bama destroyed America's middle class so don't expect any miracles until we get a new POTUS and replace half the brain dead there now. I wonder if Boner and McConnell are even conscious?! They sit there like dopes and let Piglosi and the other far left wing liberals roll right over them. Newt Gingrich is right when he says the government no longer represents the American people. I'll have to re-read his book for solace.
And yet by 6am futures will all be green...........amazing
Like fucking fairy dust magic, through of all the bad news, the sun will rise over a green board. Like dice on a craps table that always flop snake eyes. Rigged.
bullish
I don't see anything but full retard. Stocks and housing will start to collapse without a rate hike, then QE 4... 5... 6... We'll see riots start somewhere in there. Hunger Games we go.
Obama is a con, every time he speaks lately i feel he is taking the mickey of the American people. He fooled many but i never thought anything of the guy.
I tought BAD NEWS is GOOD NEWS for Wallstreet??
http://www.multpl.com/s-p-500-earnings/table
actuals headed south in 2q2015?
lots of volatility in actual numbers: 2006 eps adjusted for inflation = 96 v 100 for March 2015 = 4% earnings growth in 9 years to cherry pick a couple of numbers.
Consensus = bottom-up or top-down?