Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Arik T.G. who wrote (18491)	5/15/1998 11:57:00 AM
From: Mike M2	Read Replies (2) \| Respond to of 94695

Arik, with respect to the "strength" of the economy and corporate earnings i wanted to make a few points. The quality of earnings is suspect for several reasons. 1. the dramatic decline in interest rates has reduced interest expense 2. option accounting gimmickery see Forbes 5/18 cover story for details 3. Share buybacks makes eps grow faster than earnings 4. massive write offs of "nonrecurring" restructurings keep recurring-g- -they bury future expenses in the write off so subsequent reports are stronger. When i make these points some people fail to understand that these factors are not sustainable going forward. 5. productivity is dismal -much lower than the 20's or Japan in the 80's in addition it is overstated to the extent the workweek in hours govt uses 35/hr week productivity is overstated. I'll fill in the stats and references later in the weekend . I'll also dispel some more of the new era lies and propaganda. Mike