PROFITS AND GROWTH

"Where's the beef?" was a catchy line in a long-ago burger commercial.

Today, a similar question investors ought to asking after all this QE is where's the growth?  Follow that up with have you seen any lately other than in asset prices?

In that respect, QE has been a miserable failure when you measure the return over five years on all the money created. Most money runners turning in a similar record would lose their jobs. What are we getting for the buck is also a legitimate, fair question, like it or otherwise.

That very growth is being questioned by some Wall Street analysts when it comes to U.S. companies faster revenue growth for 2014 and beyond. According to Factset, analysts cut second quarter growth estimates for S & P 500 firms to 2.8% from 3.5% on a year-over-year basis. That 0.7% decline is well beyond the last four years quarterly average of 0.3%, per Factset.

So have higher earnings reports been buoyed more by cost-cutting and buy-backs rather than reality, since the second quarter of 2011 revenue growth for any three month period has not gone up? Revenue mirrors the economy.

Bureaucrats and other economic apologists can talk measures of inflation all they want, but flat wages, higher food and energy prices spell trouble as in the big T. And that rhymes with capital PG as in profits and growth.

Not an especially a good recipe to paraphrase an old Wall Street bromide for a stock market that may be running more on promises than facts.