It seems al the price action in both stocks and bonds is being affected by the lack of inflation. Jack talks about narrowing spread between PPI and CPI which could contract operating margins for manufacturers.
As equity markets make new all time highs the real question is, “Where is the volatility?”. Jack explains that the low VIX may be a prelude to larger violent moves in the future.
Jack talks about the jobs number which came out better than expected and tells us to watch oil as an indicator because of the extreme volatility.
Between the FED announcement, earnings and Friday’s unemployment number, Jack tells us we need to be very careful this week. The falling price of crude is also something to watch because of the ancillary effects on other markets.
We’re seeing the appropriate signs of earnings growth, but the real question is whether the economy will show lasting signs of improvement. With the jobs report Friday, Jack Bouroudjian says this could be a year to “hedge in May and walk away.”