What CNBC describes as one of the most important earnings seasons ever is practically here. The two things investors will be looking for: actual revenue growth (i.e. not just cost cuts), and health among financials.
So, will financials be profitable? Well it depends on which one.
According to Bloomberg’s survey, Goldman Sachs (GS) and JPMorgan (JPM) will both clock in with earnings of over $2 billion. Citigroup meanwhile, will return to the red, and lose $2.5 billion. That follows two straight quarters of “profits” that were the result of clever accounting.
Meanwhile, according to Chris Whalen of Institutional Risk Analytics, the Q3 numbers are going to be nothing compared to Q4, which he predicts will be a bloodbath, due to a return of illiquidity.