I understand the concept of TINA: "there is no alternative" to investing in U.S. stocks. I get that central banks in Europe and Japan are pumping money into their economies, propping up their stock markets.
What I don't get is the seeming indifference to the notable slide in earnings we have been seeing. Say what you will about quantitative easing, ultimately stocks have to trade at some multiple of earnings that is acceptable to investors, and right now the numbers are coming down much faster than usual for both fourth quarter 2014 and first quarter 2015.
The simple way to look at this is to look at the annual earnings numbers for the S&P 500. They are still going up, but at a much slower rate than in previous years:
S&P 500 earnings (source: Factset)
Remember, a lot of strategists had numbers around $125 for 2014; we are ending far below that.
Bulls can say, "Well, earnings are still set to rise in 2015," but that is pretty thin gruel. The rise, right now, is minuscule, and that 2015 estimate of $120 is very pie in the sky because most of the earnings gains are loaded into the fourth quarter.
My point: It is very possible that earnings growth could go negative in 2015. How possible? I give it a 50-50 chance. That would be the first time that has happened since 2009.