There are many hopes and dreams surrounding the massive multiple expansion of 2013 (that Goldman has warned is entirely unsustainable). Top-line growth is already disappointing in the current results season. The bottom-line is going nowhere but faith remains that we are not near 'peak margins'. While financial engineering (e.g. buybacks) remain possible (though harder in a Fed tapering, rising rate, credit saturated environment) the following chart from Philly Fed data indicates that a 'belief' in the margin story is over - as the spread between prices paid and prices received plunges to its lowest since April 2009 (and in line with previous recessionary periods).
Profits anyone?
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And over the past 30 years, this has not been a good sign...
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Charts: Bloomberg