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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: SouthFloridaGuy who wrote (36737)	9/8/2005 11:01:43 AM
From: mishedlo	Respond to of 116555

LIG - You need to look at the quality of those "earnings" as well as the repeatability of them. The Financial sector and energy sector provided almost all of those earnings. Only the energy sector earnings are quality IMO. I think earnings in general have peaked and I sure do not think that financial sector earnings are remotely close to being sustainable over any kind of forward looking duration. Most of the financial sector earnings depend on the housing bubble blowing even bigger and no credit event happening. Unlikely on both counts IMO. The touted earnings of the S&P is a mirage. Mish

To: SouthFloridaGuy who wrote (36737)	9/8/2005 11:57:18 AM
From: John Vosilla	Read Replies (2) \| Respond to of 116555

"The deflation scenario will probably have to be to be put to the side for the moment unless we have some type of systemic event which takes stocks from under-valued to outright cheap" Haven't visited you guys here in a while. Hope the deflation crowd is having a ball.. much higher costs of doing business = much higher costs for basic services you need every day = higher real inflation = much higher long term rates = lower multiples to cash flow for RE and stocks = lower prices for certain overvalued assets that can't increase cash flows as an offset Yeah I know wet behind the ears hillbillies like me make your business viable. Christ I'd be broke listening to your advice all these years. No middleman fees to keep me going if I was wrong<g>