Its earnings season again. Regular readers know my antipathy for 'operating earnings' as opposed to the reported variety. Previous posts such as Cheaper Than They've Been In Two Decades huh? outline the lengths Wall St. will go to paint a rosy picture. Wall St. loved reported earnings until the late 90's when it stopped justifying their bullish stance on stocks so they switched to the more favourable operating. Wall St. loved GAAP (Generally Accepted Accounting Principles) until the housing bubble popped and very few of the banks were left solvent using its time honored rules so the banks bought a few more congressman and senators and had the rules altered (remember FASB 127 aka mark to market?)
Just as reported was switched to operating, mark to market was switched to mark to fantasy or as the boys over at Comstock are wont to say GDAP or Generally Deceptive Accounting Principles.
Please take a moment and read this latest piece from Comstock Why Valuation Doesn't Insure Against a Significant Market Decline. If anything it might help you sort through the garbage spewing from the mouths of the shameless shills on the pom pom network (CNBC).