Tuesdays-Thursdays the next few weeks will be the heart of earnings season - we began today. Thus far I cannot make heads or tails of the action. Remember, our thesis we've been promoting all year - 2nd half 2008 estimates are far too high, especially fourth quarter hence guidance is going to have to be cut across many names; analysts are simply behind the ball. Since the dollar has rallied, what used to be safe haven (multinationals) who have been benefiting from a weak dollar, which is hiding pathetic organic growth, are going to see that benefit begin to erase. While CNBC cheered the multinational growth 1-3 quarters ago we were pointing out how much of it had nothing to do with "growth" and everything to do with a weakening US dollar. Now that will reverse. And now with the damage the credit contraction has done to the system we are adding another layer of bad onto what was already going to be poor. The question is how much of this is priced in, and how do the stocks react? While everyone has been focused on the credit situation I continue to believe the market is underestimating the coming earnings plunge due to the real economy.

Here are some results so far today and in the near term

Johnson & Johnson (JNJ) - steady Eddie

• Health care giant Johnson & Johnson on Tuesday reported a 30 percent jump in third-quarter profit, beating Wall Street expectations, due to the absence of a $745 million restructuring charge a year ago, as well as higher sales of consumer products and medical devices. The New Brunswick, N.J.-based maker of contraceptives, baby care items, medical devices and prescription drugs reported net income of $3.31 billion, or $1.17 per share, up from $2.55 billion, or 88 cents per share, in the year-ago period.
• Revenue climbed 6.3 percent, to $15.9 billion from $14.97 billion, but was boosted 3.1 percent by favorable currency exchange rates because of the weak dollar.

PepsiCo (PEP) - which is supposed to be another safe haven is down 9%. Further they are cutting 3300 jobs. You know it is bad when Americans are not only cutting back on $4 lattes (Starbucks) but $1.25 2 liters.

• PepsiCo announced plans on Tuesday to cut 3,300 jobs and close six plants as it deals with lagging U.S. drinks sales and a surging dollar, which will hurt profits from its rapidly growing international business. The announcement came as the global snacks and drinks maker reported a 9.5 percent drop in third-quarter profit that missed Wall Street expectations.