If inflation doesn't accelerate much from here, and the Fed just raises rates a little more, we might see something like the end of the 1990s again. But if the Fed has to really ramp up to fight inflation, it's going to be a much worse environment than investors realize.
I think the next really big number for the market is next Friday's retail sales figures. Up until Friday, investors are going to be focused on oil prices, the earnings, and to an extent, the election.
What stock investors probably need to be thinking about now is 'what are profit margins doing?'. A little inflation wouldn't be so bad for the stock market, for Corporate America, but it wouldn't be good for the economy or the consumer.
A lot of people were hoping June was a fluke and that employment would bounce back, but two in a row is pretty tough to write off. I think market investors are now more worried about the corporate and economic outlook.
A stronger-than-expected payroll figure may lead a lot of analysts and investors to rethink their views on the