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Author: matson15 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 461106  
Subject: stock prices - too good to be true?" Date: 2/11/2013 12:37 PM
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Some bullets

http://seekingalpha.com/article/1170551-as-stock-prices-cont...

As Stock Prices Continue To Rise, Earnings Continue To Decline by Lawrence Fuller 2013-02-10

? As Stock Prices Continue To Rise, Earnings Continue To Decline BY Lawrence Fuller 130210
? Wall Street continues to report that fourth-quarter earnings releases are beating expectations, with some 68% of companies exceeding estimates. This makes for an alluring headline. Regardless of what expectations were, or what they are today, earnings are declining as stock prices are rising. That is all that is relevant.
? The reason for the decline in earnings, despite the surge in revenues, is that margins continue to erode.
? When accounting for $162 billion in tax increases that is sapping consumer spending power, and the inevitable spending cuts and additional tax increases that will result from sequestration, it is hard not to imagine earnings declining from current levels, much less increasing.
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Author: notehound Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415620 of 461106
Subject: Re: stock prices - too good to be true?" Date: 2/11/2013 4:01 PM
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Matson,

To somewhat corroborate or at least correlate with your linked essay, Bill DeShurko, in an article on MarketWatch.com suggests that the divergence between HYG and SPY may be a signal that stocks could break lower soon. He is waiting to see whether HYG turns up or whether SPY turns down to determine the meaning of the uncharacteristic divergence.

http://www.marketwatch.com/story/a-troubling-sign-from-junk-...

I created my own 1-year chart to assess his comments, at the following link:

http://investing.money.msn.com/investments/charts/?symbol=jn...

You can see that HYG and SPY do appear to move in the same direction, with some lag.

;-)

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