09 January 2009

Duck Season! Wabbit Season! Dirty Skunk Season! Fiddler Crab Season!

Naaah! It's earnings season!

And the EIC of Marketwatch, David Callaway, thinks earnings season means it's the end of bear season, as in the end of the bear market rally:

Everybody should have known the holidays would only delay it. The freight train of job cuts, plunging earnings and massive spending cutbacks set to hit the economy was, thankfully, pushed back a few weeks while stunned investors and workers across the globe caught their breath after the worst fourth quarter in decades.

But now the great dying has begun, and I'm not talking about German billionaires throwing themselves in front of trains or French aristocrats slitting their wrists, as alarming as these incidents have been. No, earnings season, the time for companies to 'fess up just how bad it's been for them in the last three months, is here.

Please tell us how you really feel.

I do appreciate how desperately Callaway wanted to call attention to the macabre suicides recently arising from the market turmoil. And I like his throwaway caveat, "alarming as these incidents have been." Reads like a last-minute add-on. Classy.

Callaway thinks we're in store for considerably more pain until investors show their confidence in the economy returning by bidding up oil prices?!?

So what will signal the turning point? Could it come during the worst of earnings season? Perhaps. But I expect it will come afterward, and that it will be tied to oil prices.

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