As we head into the New Year, global growth is at its lowest levels since 2009. This can be seen in the recent traffic reports at America’s three largest ports in August and September. All three harbors reported container numbers down year-over-year, the first time that has happened in a decade. Japan is back in an official recession after two straight quarters of economic contraction. Europe was barely above stall speed despite the best efforts of the European Central Bank before the heinous terrorist attacks in Paris over the weekend. No one knows what China’s true growth rate is although most suspect it is significantly below the official seven percent target. Copper is at six-year lows, oil has plunged over the past year and iron ore prices are scraping bottom; none of which should be happening if the Middle Kingdom was posting significant growth. Both imports and exports have sported year-over-year declines in recent months. It is plain old ugly in these parts of the market.

Domestically, outside of housing and auto production, pockets of economic strength are few and far between even as the Federal Reserve prepares to deliver its first interest rate hike since 2006. Initial third quarter GDP growth came in at just 1.5% after posting almost four percent growth in the second quarter. Back to school sales were somewhere between disappointing and dismal with inventories historically high as we head into the critical Black Friday period.

We did get a recent impressive Jobs Report for October, but that is looking more and more like an outlier. Outside of autos, industrial production is on the cusp of contractionary levels. Most importantly for investors, profit growth has stopped dead in its tracks for the S&P 500 thanks to a strong dollar, tepid global demand, and the collapse in energy and commodity prices. Earnings posted year-over-year declines in both the second and third quarter after barely being above flat line in the first quarter. The current consensus has profits declining again in the fourth quarter. This is looking like the first year since 2009 where S&P 500 profits came in at below year-ago levels since 2009.

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