The storyline being peddled by many stockbrokers across America goes something like this: equities are attractive because they are emerging from a profits black hole caused by the deep recession. Just look at second-quarter results for proof. Three-quarters of S&P 500 companies have reported numbers ahead of forecasts.

But nothing could be further from the truth. Far from being depressed, aggregate profit margins are near record highs. According to the latest national accounts data, as a percentage of corporate output, second-quarter profits before depreciation, interest and tax stood at about 35 per cent, only a smidgeon below pre-crisis levels in 2007. By contrast, the average margin going back to 1947 is 29 per cent, according to Smithers & Co.