The news has been so depressing lately that we find ourselves turning to the business section each morning for comic relief. Monday’s daily chortle required readers to juxtapose two stories: 1) the Dow Industrials, currently trading in record territory, have risen on 12 of the last 15 trading days; and 2) Q2 earnings for America’s biggest companies are set to decline for the fourth consecutive quarter. Is there something wrong with this picture?
A columnist for The Wall Street Journal embarrassed himself and his editors recently with the incredible theory that although U.S. corporate earnings do indeed stink, and have stunk for more than a year, they simply don’t stink badly enough to threaten the seven-year-old bull market. For the record, earnings for the quarter ended on June 30 are projected to fall 4.7% from a year earlier. This follows a 5% drop in the first quarter. Of course, who needs earnings when there’s a global flood of funny money pushing stocks higher?
Flacks & Shysters Join Hands
Given the stock market’s relentless climb since late June into record territory, the question naturally arises: How long can this go on? “Indefinitely” is the implicit answer we get from Yellen and the shysters and PhDs charged with flacking the Fed’s epic Ponzi scheme. With all of her economic drivel, Yellen comes off like the owner of Harry’s Super Discount Furniture Store, where, as the old joke goes, they lose a little bit on each sale but make up for it with volume. The central bank would have us believe something almost as stupid. The man on the street surely knows it’s a big lie, but Wall Street’s best and brightest continue to pretend otherwise.