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When the S&P 500 first hit 2,130 in May of 2015, aggregate earnings were $99.25 per share already 6.4% below the cyclical peak of $106 per share set in September of 2014.  This means that stocks in May of 2015 were valued at a fairly high 21.5 Price to Forward Earnings Ratio, and that was based on falling earnings to boot.  Earnings continue to fall to this day down to $87 pushing the ratio out to 24.5 which is getting quite steep.  Now analysts, optimistic bunch that they are, figure earnings are going to explode higher as the year comes to a close, good luck with that.  There’s an old saying on Wall Street about analysts, “you can’t trust them in a bear market and you don’t need them in a bull market”.  Anybody who takes the time to look is going to realize fairly quickly that the official narrative is in fact a house of cards, and has been for quite some time now.  Friday’s employment report is but the latest example.

This is Caleb Lawrence Registered Investment Adviser Scotts Valley Drive and Willis Road in the Scotts Valley Plaza, Suite 202 or call me toll free at 888-RICH PIG / 888-742-4744.

You can catch me on the radio at noon each business day as well on California’s central coast.  KPIG 107.5 FM in the Monterey Bay or KPYG 94.9 FM in San Luis Obispo.

Rebroadcasts, additional writings and other entries are also available on my Blog at www.clinvestments.com

Investment advisor services offered through Caleb Lawrence Registered Investment Adviser Inc.

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