NEW YORK (CNN/Money) - U.S. companies have got to be breathing a lot easier now than they were a year ago.

The accounting scandals that rocked the market last summer seem a thing of the past, there's strong evidence that the economy is getting better, second-quarter earnings have come in surprisingly well and share prices are way higher than they were in January. Things are looking up.

The worry, however, is that expectations have grown too optimistic -- particularly on the earnings front. Yes, economists expect growth to pick up in the third and fourth quarters, but measured against where the economy was last year, that growth will be paltry.

According to the latest survey from the Philadelphia Fed, gross domestic product in the third quarter will be up by just 2 percent from where it was in the year-ago period. In the fourth quarter, the GDP is expected to be up 2.5 percent on a year-over-year basis.

It's worth noting that this differs from the way GDP is normally reported, which annualizes growth from one quarter to the next. In the current context, annualizing numbers makes growth seem faster than comparing current figures against their year-ago counterparts. Since earnings estimates use year-ago comparisons, however, it's appropriate to use the same method in comparing GDP. And against that backdrop, earnings estimates seem quite high.

In the third quarter, according to Puglisi & Co. chief market strategist Ozan Akcin, Wall Street industry analysts expect earnings at S&P 500 companies to advance 12.2 percent from where they were a year ago. In the fourth quarter earnings are forecast to jump 18.3 percent.

Around now is when you start wondering exactly how all the lithium got into the water coolers at Wall Street research departments.

The funny thing (and the thing that has Akcin fairly bullish on the market) is that companies appear just as sanguine about their prospects as the analysts are.

During the second-quarter reporting period they didn't, as they have in the past, do much to talk down Wall Street's expectations for future earnings. In fact, it appears that firms talked up expectations -- estimates for both the third and fourth quarters are fractionally higher now than they were at the beginning of July.

"This is all in keeping with the general thesis that we're in the beginning stages of the economic cycle," said Akcin.

How is it that Akcin and other strategists can believe that earnings growth will be strong? Hang it on what economists call operating leverage, a powerful dynamic that can lift profits far faster than sales when business improves.

Here's how it works. Say you're a fairly recent college grad struggling in your first real job. You live in an efficiency, you drive a beater and your gastronomic tastes run to ramen noodles. Then, you get a promotion or you get a better job and, wham, you're earning way more than you did before.

At first, you keep a lot of those earnings. After all, your lifestyle hasn't changed that much, other than buying a couple of pairs of Dockers and updating your beer from Pabst Blue Ribbon to Molson. (You will later, which will make it tough if you ever lose your job or take a pay cut, but that's another story.)

Companies coming out of a downturn have cut costs so deeply that they're like you, just out of college.

"You're going to see continued cost discipline," said Ethan Harris, chief U.S. economist at Lehman Brothers. "So when growth comes it won't be spent on things like wage increases, but will flow to the bottom line."

Harris reckons that while fourth-quarter estimates look steep, earnings growth really could hit the analysts' target for the third quarter.

Not everyone is so positive. Rich Bernstein, Merrill Lynch's chief U.S. strategist, is deeply skeptical over whether company revenues can increase meaningfully in the current economic climate -- which would make it impossible for the miracle of operating leverage to happen.

The reason? Bernstein's work has shown that more than anything else, revenues are affected by pricing power, otherwise known as inflation. And inflation continues to run very weakly. Nor can Bernstein see it accelerating soon, given that U.S. industry is running at just three-quarters capacity, according to the Federal Reserve.

"What people are betting on here is inflation," said Bernstein. "I'm not sure that's a bet you want to make."