For the longest time, analyst consensus was that 2015 S&P500 EPS would rise a comfortable 8-10% compared to 2014. However, in recent weeks, as a result of the collapse in energy company earnings - whose prices as previously discussed are due for a 40% plunge to implied historical PE multiples - as well as almost all other company earnings as a result of the soaring FX, projected EPS have tumbled at the fastest rate since Lehman. In fact, with forward 12 month EPS now below 124, or roughly where they were back in April of 2014, the S&P is now about 100 points higher compared to where it was last time earnings were projected to be this level. Only back then forward EPS were rising. Now they are falling dramatically, and are likely to see even bigger drops in the coming months. Then again, there is nothing a little central bank multiple expansion can't fix. What's worse, however, is that while consensus still expects 2015 EPS to see a modest increase Y/Y, Q1 of 2015 has already been written off, with what at the beginning of the year was projected to be a 4% Y/Y EPS increase, and on September 30 2014 stood at 10%, has now plunged to a nearly 2% decline. From Factset: Looking at the current quarter (Q1 2015), what are analyst expectations for earnings growth? Is the current streak of eight consecutive quarters of earnings growth expected to continue? The answer is no. This week marked a change in the aggregate expectations of analysts from year-over-year growth in earnings for Q1 2015 to now a year-over-year decline in earnings. However, expectations for earnings growth for Q1 2015 have been falling not only over the past few weeks, but also over the past few months. On September 30, the estimated earnings growth rate for Q1 2015 was 9.9%. By December 31, the estimated growth rate had declined to 4.2%. Today, it stands at -1.6%. Most of the expected decline in the estimated earnings growth rate for the S&P 500 for Q1 2015 is due to reductions in earnings estimates for companies in the Energy sector. On September 30, the estimated earnings growth rate for the Energy sector for Q1 2015 was 3.3%. By December 31, the estimated growth rate fell to -28.9%. Today, it stands at -53.8%. Needless to say, absent a surge in oil back to the $80s, it is only going to get worse. So how do we get back to $80 oil? Simple - once a majority of US shale companies file for bankruptcy just as Saudi Arabia demands, leading to a recession in Texas and numerous other states, and freefall, literal and metaphorical, for countless energy junk bond investors - then, and only then, will Saudi Arabia halt the crude gusher to a trickle, sending oil soaring and letting the good times, if only for oil exporters, roll again.