Chart of the Day - Corporate earnings near credit bubble highs

Chart of the Day - Corporate earnings near credit bubble highs:

One positive for the stock market has been the dramatic rise in earnings since early 2009. For some long-term perspective, today’s chart illustrates inflation-adjusted, as reported S&P 500 earnings since 1900. One period that stands out is the 92% plunge from the Q3 2007 peak to the Q1 2009 low which brought inflation-adjusted earnings to near Great Depression lows. Since its Q1 2009 low, S&P 500 earnings have surged (up over eleven-fold) and are currently fast approaching credit bubble peak levels. It is interesting to note that the only time that inflation-adjusted S&P 500 earnings have been higher than current levels was a relatively brief 18-month period from late 2006 to early 2008.

A loss never troubles me after I take it. I forget it overnight. But being wrong — not taking the loss — that is what does the damage to the pocket book and to the soul. -- Jesse Livermore in Reminiscences of a Stock Operator