The thing with parabolic moves is that
they can last longer than expected. But as Walter Diemer says, when they go
up in a straight line, they typically go down in a straight line.
So it's something that is hard from a trend basis.
You don't remember 2000 like, no, wait, no one in the studio, no one in the
control room remembers 2000. That's our plane.
Classic rock today. Don't like Gerty today.
You guys spit on his coffee yesterday when they played Journey Camp Journeys,
a band from California camp. I'm looking here in a while.
Idema, of course, is a legend on this, but the answer is Trees to the Sky 1999
2000 without profit. This time around, I got free cash flow.
That's a distinction you do, but you always have to be aware of when stocks
are running ahead of what the earnings estimates have been being revised higher
themselves. So if you look at a name like in video
in prior reports, each time that they would report, the forward guidance would
go up by $0.30 or $0.40. This time it's about $0.05.
Is that the end of the world? No, but it does mean that we should
probably lower expectations for the pace of returns simply because the pace of
earnings revisions higher are starting to slow.
The issue would be if the stock keeps going up, even as earnings slowed down
and the revisions higher, that's when you get the trees grow into the sky.
The issues with valuations being far too stretched at this point in the earnings
season, are we talking too much or focusing too much on tech?
What else is sort of drawing your attention or what?
What is tech distracted by? But I apologize.
It's such a Brooklyn question. Curiously, people funds go Luddite,
let's go old school. What what other sectors?
But see, I speak that language. So I think that the interesting thing
about this earnings season is the reaction of the stocks in the backdrop
is that we've seen some of this weakness in tech start to build tech traded below
its 50 day moving average yesterday. It's been deteriorating on a relative
basis. What's been winning the for 93 the equal
weight index. So if we look at earnings estimates
going into 2025, what you can see is the MAG seven is expected to decelerate a
lot, but the overall market is expected to accelerate, which effectively says
the 493 is about to have to carry all of that weight in the earnings growth.