Global earnings are improving, but we're not seeing an inflection point yet in relative terms. Check out the chart: The top panel shows the earnings estimate squiggles for EAFE (Europe, Australasia and the Far East). Earnings have been trendless for more than a decade, at least in US dollar terms. In the bottom panel I show a Z-score of the relative return (a good way to normalize a time series), overlaid against the relative earnings squiggles (EAFE vs. US). There is a historical pattern here, with estimate momentum driving return momentum. But not so much today.