But blaming everything on the calendar is not the right way to approach this.
There is a broader issue being raised by traders, even as it relates to the United States, that goes beyond the recent weakness: given that almost half of the S&P 500 earnings come from abroad, why should I pay 17 times forward earnings for stocks, if the global economy is indeed contracting?
That is why we are seeing an unwind of "global growth plays," that is, investments in large multinational companies.
Global Industrials in Q3
Not surprisingly, the weakness in these large companies...that sell products across many categories in dozens of countries...began in June, when China began falling apart.
Slower global growth is also causing investors to question the ability of "young tech" companies to grow at the speed they were projected, and is causing a focus on future profitability. Venture capital investor Bill Gurley of Benchmark got a lot of attention yesterday when he tweeted, "The bottom line is that global tech valuation multiples are compressing (coming in). Quickly....If so, we may be nearing the end of a cycle where growth is valued more than profitability. It could be at an inflection point." (@bgurley)
This has been on the mind of investors in even more mature tech stocks for several months. Look at these former social media darlings.
Social Media in Q3
The good news is that valuations are not nearly as stretched as they were in 2000. The bad news is that some of the younger companies still are not profitable, and investors can still lose patience quickly.
Of course, some companies can reinvent themselves and can surprise the Street. But we know who they are, and it's a fairly small group.
Internet leaders in Q3