Starting next week companies will begin reporting their third quarter earnings. Over the course of this “earnings season” 33 firms report during the first week, 239 the second week, 732 the third week and 796 the fourth week.

In aggregate, corporate profits, after tax and with inventory valuation adjustment and capital consumption adjustment, have increased, on average, at a year over year rate of 8.58% since 1952. The variation of the percent change from a year ago has been wide, from a 59.9% year over year increase (Q3 1974 to Q3 1975) to a -29.0% drop (Q3 2007 to Q3 2008).

The last negative year over year change in corporate profits, with the aforementioned adjustments, was the Q1 2008 to Q1 2009 time period.

Interestingly, while many negative year over year changes have occurred during recessions, there were three notable periods during which the economy was not in recession and year over year profits were shrinking in aggregate; the mid 1980s, the late 1990s and the early 2000s.

From Q2 2011 to Q2 2012 aggregate corporate profits, after tax and with inventory valuation adjustment and capital consumption adjustment, increased by 4.4%.