IT it is not a matter of believing it is a matter of show me the money. If you show me how it can be done with some kind of catalyst and some numbers that beat the normal peak to peak pace I will buy it until then I am going by historical peak to peak earnings pace best case scenario vs. some fantasy number cranked out by the sales force of a brokerage firm. Just to get to year end $59 earnings we would need a 17.8% per quarter pace for next two. Man that is a tuff enough pill to swallow let alone the 70 next year. Even the gang at S and P has it at 54 for year end as of now.Yes that estimate is for an amazing unrealistic rise in the next 2 quarters just to get to 59. HOW? What is the catalyst? We already cut the heck out of jobs, lots of the fat, forwarded house sales, cars sales and that is how you got to these "good beat the estimate" numbers in the first place. Lets see next earnings when they come out and by then we will see if we get close to 59 pace.
That $59 looks like it might be the 2009 forecast. If it's truly 2010 I think it's way too low. At any rate, what I'm talking about is 2010. Here's a link:
So we have two choices believe stock sales people estimates who never lie or peak historical pace in earnings best case. I will go with Plan B.
The last quarter of this year we will begin to focus on the 2010 earnings, not the 2009 earnings that you're focusing on. But I'm firmly convinced that you won't be believing any of this anyway. So let's leave it like this...if $70 comes in next year, stocks are going higher, corrections notwithstanding.
OK. I guess you'll be shorting em from now until doomsday then eh? Garzarelli by the way is an independent analyst, not from a brokerage firm. Good record too by the way...one of the few to call the 87 crash. Take a look at the links.
We can revisit this topic later on when you have some crow to eat.