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For an indication they are not so bad. They trail behind usually, but for big swings they seem to be good enough indicators. Both EE and SO went down after Panda and never recovered. So did tons of other sites, genuine or not. And a lot of spammy sites (there appeared a ton of new (Russian) sites in the index using subdomains (x.bla.com) instead of directories (bla.com/x) which seems to work now in fooling Google that it's 'quality' and sites with no own content (Markosweb as nice example) only grew larger.

So Google is a long way from achieving their goal while good sites get punished.

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