We are entering third quarter earnings season, and the level of cluelessness has never been so high. You can't blame analysts and strategists for being confused about the magnitude of the earnings decline. Is inflation peaking? If it is, will it stay elevated for some time? How long will corporations be able to keep raising prices before profit margins are eroded? Is there an endgame to the Russia-Ukraine war? Here's a look at where we stand on earnings. Third quarter earning season is off to a lousy start. Fifteen companies have reported, with nine beating, five missing and one meeting, a poor showing, led by disappointing earnings and guidance from FedEx, Nike, CarMax and Micron. Wells Fargo's Chris Harvey called the start of third quarter earnings season "A Dud." "Less companies are beating estimates, and by a lesser amount, growth is slowing rapidly and there are an increased number of negative EPS estimate revisions relative to last quarter," Nick Raich at The Earnings Scout said in a note to clients on Friday. The forward earnings multiple is nearing recession territory. With the S & P 500 closing at 3,585 for the third quarter, the forward earnings multiple now stands at 15 times 2023 earnings, according to S & P Global. That is well below the roughly 21 multiple we saw in January and lower than the long-term average. A recessionary multiple for the S & P would be between 13 and 15, though it has gone lower. S & P 500: Forward Earnings Multiple 2023: 15.0 5-year average: 21.7 Avg. since 1988: 19.2 Source: S & P Global estimates Operating margins are coming down. The second quarter of 2021 saw an historic high operating margin of 13.5% for the S & P 500, and that has been coming down ever since: Q2 2021: 13.5% (record) Q4 2021: 13.4% Q1 2022: 11.9% Q2 2022: 10.9% Source: S & P Global Overall earnings estimates remain in positive territory, but growth sectors are getting slashed. Third- and fourth-quarter estimates for the entire S & P 500 remain positive, up 4.5% and 5.8% respectively, but are half what they were at the start of the third quarter. More importantly, earnings estimates for the "growth" part of the S & P have been getting cut for both the third and fourth quarters. Consumer Discretionary: Q4 ests. July 1: 6.4% Today: - 0.6% Technology: Q4 ests. July 1: 8.6% Today: 1% Communication Services: Q4 ests. July 1: 2.3% Today: -9.2% Source: Refinitiv Since the multiple on the S & P has already come down significantly, a collapse in the earnings estimates is the last thing separating those who are at 3,600 on the S & P 500 from those who are at 3,000. Current estimates of S & P 500 earnings at $223 and $241 for 2022 and 2023, respectively, are being widely scoffed at by strategists, but no one can agree on what the right estimate should be. The range of estimates is unusually high — a sign how clueless everyone is on the ultimate outcome. Typical is Chris Hyzy, chief investment officer at Merrill and Bank of America Private Bank. His firm has a $200 estimate for 2022, well below consensus, but in a discussion with CNBC's Scott Wapner last week he noted the Street estimates range from $150 to $240. "I don't know if I've ever seen that big of a range across the industry," he told Wapner.