Off the Cuff: Vicious Volatility

In this week's Off the Cuff podcast, Chris and Brian Pretti discuss:

• Emerging Mayhem in Emerging Markets
  • Weakness at the periphery is accelerating
• Vicious Volatility in the Financial Markets
  • Investors have whiplash from this week's price moves so far
• The Case for a Big Market Pullback
  • Even the bulls think a correction at this point would be healthy
• False Safety
  • Treasurys will be a safe place to part capital….until they aren't

Chris and Brian strap themselves in tightly to discuss the wild ride in the markets recently. As recently predicted, volatility is likely going to be the dominant theme for markets until they break big either up or down. This week has not disappointed.

The podcast starts off by looking at the rash of economic, monetary and/or political fires now erupting across the developed world. The past week has brought news of crises in the Ukraine, Turkey, Argentina, Venezuela. Russia and South Africa are having currency troubles.

Chris has long ascribed to the view that economic contagion happens from the outside in; that is, it first breaks out among the weakest players and then progressively marches towards the strongest. We are definitely seeing the periphery markets stumbling here. The key question: If they topple, will they cause other, larger dominoes to fall?

Brian then makes the case for why today's stock market is overdue for a pullback, and for why it will likely be a big one when it does happen.