Are Stocks at the Beginning of a Serious Bull Run?

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July 8 (Bloomberg) -- JPMorgan's James Liu, Global Financial Private Capital's Mike Sorrentino and Bloomberg's Barry Ritholtz discuss the outlook for U.S. stocks and Federal Reserve monetary policy on "Street Smart." (Source: Bloomberg)

Perspective on today's selloff.

Barry had been rather positive saying that things are looking pretty good for this market and we could just be in the beginning of a pretty serious all run.

Do you like that?

I like the market for the rest of the year.

I think the issue that is also rising for the rest of the year -- as people try to predict when the fed will raise rates, i think there will clearly be increased volatility.

But there'll be opportunity as we see more volatility, more days of triple digit losses.

If you have a long-term focus right now, i would take any kind of volatility from any kind of interest rates, with the midterm elections coming at the end of the year, none of these will really change the long-term -- investments.

Do you think that volatility is making a comeback?

It does not track volatility well and this is a really tough trade.

We could take another volatility trade and there are other options on volatility, -- i am not a fan of any of the derivative function, they don't track what they are supposed to track.

There goes that idea.

I was thinking the same thing.

I will tell you whatever you want.

We have our: kicking it off just a moment from now.

She will let us know when it comes.

How does that set the stage?

It definitely sets the stage.

We had really great earning growth through the cycle and we will get about 10% earnings growth for the s&p coming up.

I would emphasize that the cyclical sectors should begin to bounce back next year as well, and consumer stocks will be bouncing back also.

Although we have earnings from some defensive sectors -- we may see these later on.

What are you worried about?

You may say the fed.

I am not overly worried about the fed right now.

I think the fed will do nothing but support the market going forward.

That is what actually worries me.

They could come back and after six months -- and they are there to support no matter what, this seems like a recipe for a problem because it takes consequence out of the equation.

If you think the fed is just going to be there, of course, just pile into the market.

Right now where the valuations are i am not overly nervous.

I think that right now, the fed -- what is the big risk?

Going back to valuations, parts of the market make me nervous.

Look at utilities right now?

Personally, i don't want to get a 3.5% yield right now, when a sector is trading at high valuations.

We saw what happened earlier this year when it came to valuations, a lot of internet stocks and utilities at that point -- there are parts of the market that make me nervous.

Utilities are a yield played for bonds and maybe with the paper -- they will start to normalize.

The thing i keep looking at is the fear of how the fed is going to get out of that program, a seven year duration and i can see why they can't let this mature naturally.

I told you i would tell you

This text has been automatically generated. It may not be 100% accurate.

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