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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (18025)

3/22/2016 1:39:03 PM

From: John Pitera

1 Recommendation

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roguedolphin

Respond to of 33421

To: isopatch who wrote (195838)	3/22/2016 1:36:43 PM
From: John P	of 195849

Great article Iso. same types of financial machinations we have seen at other market peaks. Message 30511971 The M&A costs are no doubt the writing off of "in process R & D" that occurs when acquisitive, rollups grow by buying companies and tossing expenses by writing them off during the acquisition process. There are about 15 parallels with 2007 and 2000 whether it's the unemployment rate, housing sales, auto sales... Record Art and collectible sales at Soetheby's and Christies, followed by auctions that fall by 45% in one case. Jerry Seinfeld Porsche Auction, that was a bust with some of his vintage Porsche's selling for half of what he paid for them in 2012. Softening of several global real estate hot spots including Hong Kong and Sydney.. and even widespread concern that the Brexit vote could cause property values to fall in the perennial bubble real estate market that is London. “The gap between GAAP (reported) and pro forma (adjusted) EPS continued to widen in 4Q, with the GAAP/Pro forma ratio of 0.74 still at its most extreme levels since 2009,” Bank of America Merrill Lynch’s Savita Subramanian said on Monday. “Trailing four-quarter (2015) GAAP EPS came in at $87 vs. $118 for pro forma EPS.” It’s jarring to hear that any metric has returned to levels last seen during the financial crisis. Unfortunately, it’s hard to conclude what the implications are here because the issues are tied to just a few industries that are facing their own unique issues. “As was the case last quarter, the chief contributor to “GAAP gap” has been Energy asset impairments/write-downs, followed by M&A costs within Health Care,” Subramanian continued. “The Energy sector alone contributed to nearly half of the “GAAP gap” this quarter.”