1. See S&P Global, S&P 500: The Gauge of the Market Economy and S&P U.S. Indices Methodology, August 2020. See S&P Dow Jones Indices.

2. The Global Industry Classification Standard is jointly developed and maintained by S&P Dow Jones Indices and MSCI.

3. See YRI’s Stock Market Briefing: S&P 500 Earnings Squiggles Annually & Quarterly.

4. Despite the COVID-19 pandemic, earnings during the first and second quarters of 2020 turned out to be better than the downwardly revised consensus estimates, particularly for the second quarter.

5. “NIPA Handbook: Concepts and Methods of the U.S. National Income and Product Accounts, Chapter 13: Corporate Profits,” Bureau of Economic Analysis.

6. “Some S corporations may want to convert to C corporations,” IRS.

7. The different time series lines in our Blue Angels charts would collide if forward earnings turned negative, but this never has happened for the broad market averages we track.

8. In our January 28, 2020 Morning Briefing, we wrote that a P/E-led meltup increased the risk of a correction. We noted that the stock market started the year with “nothing to fear but fear itself.” By the end of January, the possibility of a pandemic gave us all something to fear.

9. Alan Greenspan, “The Challenge of Central Banking in a Democratic Society,” December 5, 1996 speech at the Annual Dinner and Francis Boyer Lecture of The American Enterprise Institute for Public Policy Research, Washington, D.C.

10. “Warren Buffett on the Stock Market,” Fortune, December 10, 2001.

11. John Apruzzese, A Reality Check for Stock Valuations, Evercore Wealth Management, November 2017.

12. Alan Greenspan, “Rules vs. discretionary monetary policy,” September 5, 1997 speech at the 15th Anniversary Conference of the Center for Economic Policy Research at Stanford University, Stanford, California.

13. Alan Greenspan, “Corporate governance,” March 26, 2002 speech at the Stern School of Business, New York University, New York, New York.

14. Jerome Powell, “New Economic Challenges and the Fed’s Monetary Policy Review,” August 27, 2020 speech at “Navigating the Decade Ahead: Implications for Monetary Policy,” an economic policy symposium sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming (via webcast).

15. Jerome Powell, July 29, 2020 Press Conference.