Tracking The Data--5/19/2014

 

Since doing the research that went along with the report I wrote entitled "A Bear Hunt" late last year, I've been watching the economic data very carefully.  Frankly, what I think might end up happening is that the Government might get what they want; increased jobs and rising wages.  HOWEVER, this might be just the thing that knocks the market for a loop.  

Since the extraordinary economic measures were first put in place in 2008, the environment for maximizing corporate profits has been darn close to ideal, most notably a lean labor force and workers who were at the whims of their employers regarding wages paid.  However if the labor market continues to tighten, I believe this could switch and wage inflation could creep into the market place.  This would hurt corporate profitability and begin to impact inflation and inflationary expectations.  And this would, undoubtedly, impact stock prices.

So, my eyes remain focused on the release of economic data and my brain remains fixated on this data's impact on market prices.