Comment

Jim Bianco was on CNBC yesterday discussing the latest GDP report, earnings and the markets.  To view the interview click on the image above.  To view any of our recent interviews click here. For more on Q3 GDP see the block below.
On the topic of earnings, Jim highlighted the charts below.  As we have pointed out many times, earnings are gamed and it has been completely normal for 70% of companies to beat expectations over the last several years.  That’s why we graded the earnings season a “gentleman’s C.”  Revenues, shown in the second chart below, have disappointed to a degree not seen in over a year.
Finally, the last chart shows the Guidance Index.  It is still positive, meaning more companies have offered positive guidance than negative guidance, but this measure has declined to its lowest level since April 2010.  Guidance is harder to game as corporations have to get analysts moving in the right direction.  Guidance is the weakest of the statistics shown below.