If a picture paints a thousand words, these three charts should write an entire book about the "market's" earnings...
Chapter 1: Bottom-Up Ugly
While the constant jibber-jabber on business media proclaims 'earnings are awesome... in fact everything is awesome', the truth is an oddly divergent reality. Net earnings revisions have been positive only 12 times in the last 104 weeks...
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Chapter 2: Top-Down Hockey Sticks
Despite these chronic historical downward-revisions, Forward S&P 500 EPS estimates continue to surge (driven by large market cap effects and the hockey-stick hopes and dreams)
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Chapter 3: Keeping The Dream Alive
Which leaves, the disconnect between 12-month forward index P/E and consensus EPS growth rates getting a little extreme...
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Chapter 4: Time's Up
If Blackrock is right that the corporate bond market is broken and unprepared for the "stress" of a withdrawing fed, [9] then exactly what will keep this divergent dream alive as the ability to fund cheap buybacks dries up faster than a broad coalition of Western allies invading Syria.
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h/t @Not_Jim_Cramer
Bonus Chart: Of course, we have the Fed's "other mandate" now of financial stability to maintain the wealth creation...
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