The market gapped higher today on the back of INTC and JPM earnings. Both companies blasted through earnings and saw the futures spike higher because of them.  But what does it mean? Were they as good as one would believe from looking at all the numbers?  INTC reported solid earnings, revenue and margin numbers.  It was amazing to say the least. However, JNJ reported a earnings beat yesterday, but missed on revenue.  These numbers from JNJ mean that they only beat because of cost cutting and the end user (consumer) was not buying more.  This was not a good sign for JNJ.  So what is the comparison between INTC and JNJ?  These companies make totally different products.  This is the key folks. I will lay it out simply.  Over the last year, inventory levels have gone to almost zero.  With the consumer still buying in small amounts (ie. when their computer crashes and it was a 10 year old model) inventories must be replenished slightly though at a much slower rate. This is where INTC comes into play. These numbers when compared to JNJ’s lack of numbers show a replenishing of inventories going on.  The end consumer is still barely buying but inventories still need to be above zero.  In addition, the pumping from Bernanke, Geithner and President Obama seem to be creating a frenzy of over stocking again on inventories as everyone has been told we are out of this recession.  This could spell major trouble down the road.  Watch for this to be a major catalyst down the line as the market starts to realize this.  Next quarter INTC should still do well but in my opinion not quite as well as they have been doing.  From here on out, I believe earnings growth will slow again for INTC.  JNJ’s numbers tell the truth and watch future consumer related earnings for confirmation.  Should all those companies show no revenue growth regardless of earnings beats, this hypothesis will be correct.  We will know in the coming weeks.