In today’s edition of “it has to be seen to be believed” we show just two charts, the first from the latest presentation by Goldman’s Peter Oppenheimer (summarized here), which shows something stunning. In Goldman’s own words: “the sharp rise in the equity markets from both their 2009 and 2012 lows has almost entirely been driven by valuation expansion. Profits have been weak, particularly in Europe. Exhibit 2 shows that the 10-year rolling nominal earnings growth rate has collapsed to -1.8% in Europe and has fallen to record lows for the global equity market.“
The second chart is from Capital Economics and is self-explanatory: it shows the % of all loans that are mortgage loans.
To summarize: a world where earnings growth has never been lower, and where another debt-driven housing crisis in China is looming.
Normally, we would say “it’s probably nothing” – after all central banks “got this”, only in this case it isn’t.
via http://ift.tt/2c5gQI5 Tyler Durden