Zeev's Turnips Patch-No Politics (ZEEV)

[Culmus]

Hi jd, long time no read -gg-

Oh, if following as much stuff as I do you sometimes "forget" to check what the numbers actually are made up of. Thanks for pointing this out, I wanted to look into these Barra definitions since a while. Still, it strikes me as odd that the implied growth rate has recently gone up again to almost the 2000 peak, three years after the peak in economic and earnings growth.

Besides leveraging I believe investment income during the stock market boom was a major factor in the high ROEs during 2000. For instance Intel derived about a third of its entire profit from equity gains in 2000. It goes without saying that these gains were part of the "official" profit figures back then whereas the writedowns of the losses for the last three years were, of course, excluded for pro forma purposes. -GGG-

Best,

Culmus