Down goes the Dow

Idiot,

Seeing that Apple is the second largest component of the S&P probably significant. Google has agreed to buy $5 billion in stock.

Be a jerk if you wish.

Igy

Theranos the Bernie Madoff of Silicon Valley. Or, how disruptive technology can be code for crooks:

https://markstcyr.com/

Igy

Ghost of Igloi wrote:

Idiot,

Seeing that Apple is the second largest component of the S&P probably significant. Google has agreed to buy $5 billion in stock.

Be a jerk if you wish.

Igy

What are you talking about? Apple? Google? Huh?

Congratulations, idiot. You won the perfecta by getting Igy to both divert and insult in the same post.

Idiot and Lemons,

Of course neither one of you insult. In regards to diverting you both do a good job of twisting toward your conclusion.

The topic here is stock buybacks and the influence or lack there of on S&P 500 earnings. I will outline so you can clearly follow the logic.

1. My contention that stock buybacks added a 4% tailwind to earnings was an incorrect interpretation of Silverblatt's data and comment. The net value to earnings appears "at least a 4% impact" to 138 issues, and 338 issues had lower share counts than the previous quarter. My apologies for the error.

2. muy loca pointed out that stock buyback contribution to earnings was muted thru index rebalancing (Silverblatt essay).

3. muy loca used Apple as an example of how one calculates the added value to earnings of stock buybacks. Silverblatt noted that stock buybacks still have an impact on the P/E of the individual component.

4. Operating (non-GAAP) earnings views stock based compensation as a non-business expense. In the last eighteen months operating (non-GAAP) earnings have fallen on a Last Twelve Month (LTM) basis from $114.51 (9/30/2014) to $98.70 (3/31/2016).

5. Alphabet (Google) and Apple are the two largest components on the S&P 500, making up roughly 6% of the market cap weighted index. Collectively the two companies have stock buyback plans of some $7 billion dollars. Both companies report earnings on a operating non-GAAP basis and use stock grants as compensation.

Conclusion: S&P 500 LTM operating (non-GAAP) earnings have fallen 14% from the all-time record reached 3Q 2014. During that same period as reported (GAAP) earnings has fallen from $105.96 to $86.50, or 18%. Stock buybacks are a major component to this 4% differential. This can be deciphered as illustrated above or by looking at some of the individual components.

Igy

Interesting fact on econ stats, which is relevant to some of our discussions - how much they are to be trusted, does the gov't cook the books, are the #s biased...

according to the WSJ, the jobs number has such a giant margin of error/standard deviation that we can regularly expect massive outliers in both directions.

"The Bureau of Labor Statistics i s90% sure that its conclusion of 38,000 jobs created is right to within 115,000 jobs,and so lies somewhere in the range of a loss of 77,000 to the creation of 153,000 jobs."

With that kind of range...amusing at how many billions are bet each month on that number.

agip,

The Fed's own Labor Market Conditions Index, which supposedly is driving policy, it trending down. Which argues for no rate hike in July.

https://research.stlouisfed.org/fred2/series/FRBLMCI

I disagree that lower for longer is good news. The economic cycle has peaked and the Fed is in a box.

Igy

Ghost of Igloi wrote:

agip,

The Fed's own Labor Market Conditions Index, which supposedly is driving policy, it trending down. Which argues for no rate hike in July.

https://research.stlouisfed.org/fred2/series/FRBLMCI

I disagree that lower for longer is good news. The economic cycle has peaked and the Fed is in a box.

Igy

the labor numbers do seem to have peaked...but if, as I suspect, it is more a labor shortage than anything else...that's inflationary.

agreed that the Fed needs to get rates back up

Ghost of Igloi wrote:

1. My contention that stock buybacks added a 4% tailwind to earnings was an incorrect interpretation of Silverblatt's data and comment. The net value to earnings appears "at least a 4% impact" to 138 issues, and 338 issues had lower share counts than the previous quarter. My apologies for the error.

This apologetic tone is such a radical departure from the typical Igy, that one might be tempted to believe that he really did have a successful procedure performed on him this past weekend. I'm still not buying it. Consider his continued unwarranted use of insults directed at anyone with a different opinion to his as well as his eagerness to change the direction of a discussion when he cannot intelligently support his position.

Don't feed the troll.

econ:

that devilish low productivity isn't getting much better...still just +0.7% y/y. Not befitting of a world class economy. I continue to blame facebook, twitter and letsrun.

Compensation costs up 3.7% y/y...why are people not happy? that's a big raise!

but they are not. economic conditions survey is quite negative, although in the same range as recent months.

same store sales blech +0.6%, same as recent range.

Igy con huevos grande. Mas duro.

Ghost of Igloi wrote:

Igy con huevos grande. Mas duro.

So the procedure was a success?

No comprende. Igy es mas duro, con huevos grande.

Ok, so Igy buys extra large eggs. I get it.

Usted es estupido!

Igy tiene huevos grande, ellos estan mas duro.

Mango Jerry compra huevos grande. Igy tiene huevos grande.

[quote]Mango Jerry wrote:

This apologetic tone is such a radical departure from the typical Igy, that one might be tempted to believe that he really did have a successful procedure performed on him this past weekend. I'm still not buying it. Consider his continued unwarranted use of insults directed at anyone with a different opinion to his as well as his eagerness to change the direction of a discussion when he cannot intelligently support his position.

What a pretentious and illiterate person you are fake Mango Jerry.

Mucho gracias.

agip,

Article on social media usage declining worldwide:

http://www.breitbart.com/tech/2016/06/07/social-media-bubble-bursting-usage-declines-across-board/

Igy