On Wednesday’s episode of Fast Money on CNBC, there were a ton of topics discussed and I wanted to clarify my thoughts and elaborate here (especially for topics I didn’t get to address in full on the air).

With the third-quarter earnings season ahead of us, let’s take a moment to reflect on the second quarter that is wrapping up.  During the last reporting period, 480 stocks in the S&P 500 Index had reported as of Tuesday’s close. Out of these, 389 exceeded analysts’ consensus view, with overall net earnings growth of 54.15% year over year.  This leaves the S&P index with a trailing price-to-earnings (P/E) ratio of 16.1 and assumes a forward P/E of 13.3, based on analysts’ expectations of $81 in net index earnings by this quarter next  year.

While P/E ratios seem to be in a relatively neutral-to-low state looking forward, there are still issues to contend with, namely housing and unemployment.

According to a Fitch report from earlier this month:

• May Residential Mortgage Backed Securities (RMBS) delinquencies declined for the second straight month, following a steady four-year increase; this is a positive.
  • For subprime: 44.8%, down from 45.2%
  • For Alt-A (borrowers with less than full documentation and lower credit scores) 33.9% percent, down from 34.1%
• They did note, however, that “approximately nine percent of performing Alt-A loans and 37 percent of performing subprime loans are modified and have a substantial risk of re-default.” This is still a negative sign.

This week, we got the following data:

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