The above chart shows the change in profits (red line) over twelve months and the index of the Wilshire 5000. (Click on the chart to enlarge it).
The change in profits declined below zero percent in Q4 2014. Should we panic?
The last time it happened it was in Q1 of 2007. A major bear market followed.
Of course one gauge is not reliable. Besides, the government could make major revisions to it. However, it is important to notice that profits, the lifeblood of equities, are not as ebullient as we would like them to be.
More details in The Peter Dag Portfolio on www.peterdag.com
George Dagnino, PhD
Editor, The Peter Dag Portfolio
Author, Profiting in Bull and Bear Markets
No. 1 bond timer in the past 12 months.
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