Goldilocks Has Equity Investors In a Headlock
The rally is driven less by reflation prospects than a return to the pre-pandemic reality of low interest rates, which leaves no alternative to stocks.
Maybe we should do what she says and just buy stocks?
Photographer: Aaron Chown - PA Images/Getty Images
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Summer is ending with the annual celebration of labor, and it looks like labor may have a little to celebrate. Last week’s non-farm payrolls data in the U.S. revealed that employment was growing rather disappointingly, but earnings growth was ticking up. This isn’t a combination to cheer up anyone who is worried about stagflation, but it does continue to suggest that labor is beginning to gain greater negotiating power in its perpetual battle with capital. So, how seriously should we take this, and what effect will it have on markets?