and living in the u.k. could earn him more space to maneuver if labor were to take over power the leftist leaders said trade deals with the united states or china would not be likely to compensate for the significant loss of trade with our trading neighbors in the e.u. and pointed out that forty four percent of u.k. exports are purchased by consumers while fifty percent of the u.k.'s imports come from the e.u. corben statement increases pressure on the prime minister as the labor bloc members of parliament could now vote with euro skeptics from the conservative party to defeat expected legislation on the issue possibly leading to a vote of no confidence and new elections hope and so-called soft breck's at position represents an evolution for the labor leader who has long been regarded as the skeptic of e.u. it also ordered him some praise rare praise that is from business groups including the confederation of british industry and the british chamber of commerce. and

sticking with the united kingdom retail sales for january in the u.k. were lower than expected growing only point one percent when expectations were for half a percent year over year u.k. retail sales were up one point six percent also far below expectations for two point six percent yearly increase the outliers in retail show that food sales took a large drop while sporting equipment sportswear toys and games all increased by eleven percent. the seventh round of talks to renegotiate the north american free trade agreement or nafta have begun but the latest news in the us mexico relationship there are more likely to make not much progress and recent months mexico and u.s. diplomats had worked behind the scenes to lower tensions that had been stoked by president donald trump's campaign pledge to complete

a wall along the us mexico border and his demand that mexico pay the cost trump demands scuttled a trip from the mexican president and pena nieto who had planned to come here last year shortly after trump's inauguration and diplomats on both sides had hoped to revive the plan for a trip this year however a phone call in recent days between the two presidents meant to firm up planned meeting for march ended a mutual frustration over the exact same issues as a can president trump to stop insists and that mexico would pay before the latest debacle diplomats and trade experts are already saying that nafta negotiation process is behind schedule now even that slow progress seems to be losing steam issues which have been seemingly unsurmountable somebody blocks include u.s. demands to significantly alter rules related to automobile imports and the imposition of a haws that would automatically kill nafta after five years canadian prime minister

justin trudeau also weighed in recently on nafta warning that quote canada is willing to walk away from nafta if the united states proposes a bad deal. we're joined by daniele de martino boot the founder of money strong and the author of fed up an insider's take on why the federal reserve is bad for america and daniel recently penned an opinion editorial that was for bloomberg view it was super interesting danielle thanks for being with us again you think that most folks weren't actually as they were so consumed by the market moves in the last few weeks that maybe not enough of pent attention was paid to the inflation data that and some other things tell us about. well you know the real the real irony here is that what got people set off in terms of inflation fears was really not not real.

the labor report that came out that showed two point nine percent year over year increase in earnings was largely offset by a shrinking of the workweek so they really. they really viewed the wage inflation problem in a silo and didn't take the whole picture into account if you're working fewer hours and you're getting paid more for the hour again they largely offset themselves they have been disregarding and this is what's stressing me out they've been disregarding news that we've seen of late on input prices raw materials the producer price index recently had a six year high and index of eighteen and dust real inputs hit a three year high and we've seen that wholesale inventories have been depleted they've been they've been they've been taken down to the bone and that implies not just that producer prices input prices for companies are high today but that

they're going to keep rising investors really need to be aware of this so i want to go back to the century years saying that the the people conflated the data related to inflation related to inflate her so. i wondered when we saw that because that's a gear gently right that's how it was reported that there was a wage growth that was a little higher than people expected and i wondered whether or not you know some on the street a wait a minute we're not going to make as much money because it's going to workers i know it's a cynical view but as you say you know that wasn't even the full picture so when we when we look at inflation how does that impact things like bond prices down you know. well let's just say for example that the work week it was just a one month just one month aberration and that the next time we get the labor report out in a few weeks that we see that rate wages have continued to rise and that the

workweek has expanded and on top of that the corporations are having to deal with higher input prices so you've got a margin squeeze right there you add insult to injury in the form of higher interest rates and all of a sudden corporations are not only spending more for their workers meaning making less for their shareholders their input prices are squeezing them six ways to sunday and their interest expense is going up when they're when they're over ridden with more debt than corporate america has ever held before i mean this is that sounds like a triple storm to me that's building and again i don't necessarily know that investors are paying attention to the to the to the height of interest rates to the fact that more recently we saw that the flip side of the weak dollar which benefits our manufacturers is that import prices are rising at a surprisingly high rate we're not going to buy as many mercedes and b.m.w.'s as we were before if we were that fortunate to begin with right and you know one of the things you didn't mention there was that the tax hit that some companies took

you know from from the new tax bill now that will work out to their advantage this year two thousand and eighteen two of the taxable year two thousand and eighteen but they did have some tax hit still for last year and you're seeing that reflected in some of the earnings reports so combine that with what you're talking about the wage growth the input cost and the tax hit even though it's temporary all those are going into it i hate the perfect storm analogy but all of those are coming together and that's really what concerns you isn't it. it is and on top of that for all of the excitement that's been generated about the tax bill you know in order to accommodate that tax bill we know that the deficit. that treasury issuance bills and bonds over the next twelve months is going to be double what it was before that and that you know and that also incorporates that the latest budgetary numbers that

we've seen but again you can't have rising supply have the fed stepping back as a buyer little by little by little every quarter and not expect bond prices to rise and i think once all of this once all of this craziness with short volatility and respect i think once the market has worked through that and the big downs and the big ups it's going to turn its attention back to interest rates back to what's driving interest rates and you know we're not that far away from the recent cycle high of three point zero three percent on the ten year treasury if we surpassed that which is maybe twelve hundreds of a percentage point if we pass that line of demarcation i can't tell you what's going to happen to the stock market but it won't be pretty. i can get the theory here and it is a little troubling as you're explaining it do you think. it's likely that we will

see another market correction before the poem so you mean it was march right. march the twenty first and i think the odds are you know don't don't hold me to this because there's one thing you can never do and that's time to market but i suspect that january was possibly the cycle high for the stock market and that we're going to continue to have one's the volatility genie is out of her bottle after the markets being as complacent as they've been on all of record keeping that we have on hand once that volatility is introduced you have to pick lee seen the top of the market for stocks and now we're in the bumpy ride part of the transition that typically precedes a bear market is this going to happen before the march the twenty first i couldn't tell you i can tell you that the focus is going to be on jay powell when he puts in his initial testimony to congress on thursday the twenty eighth well let me ask you

about him and about the poem see a meeting and i know that it would be unfair to there's so many variables between now and the meeting but. just say things were pretty much the status quo that there were no no new wage numbers that surprised people and the c.p.i. didn't you know bugaboo again. if everything was like it is now do you think we would be looking at a rate increase at the march meeting and how much quarter of a percent so i'm going to give you a roundabout way of getting to my answer of absolutely had it been had it been alan greenspan had it ben ben bernanke had it been janet yellen on what jay powell first day of work was which witnessed a sixteen hundred point decline in the dow it ended up closing down twelve hundred any of his three predecessors would have come out and hit the panic button and said the federal reserve stands ready to act. you know we heard from jay powell nothing

not one word so i think he's already starting to command a presence and he's also announced to the market that even if there is a major slide and stocks between now and march the twenty first that f m c statement being released he's still going to hike interest rates in march probably also in june ok well and you know we're we're taking notes every time we have you on danielle and we we don't call your answer will we know we were on the board thing i was going to say is we remember you're jay powell is not a janet yellen clone and so that goes to what you're saying now we'll see more of that in the testimony coming up and we'll we'll see of the poem see meeting in march danielle de martino both founder of money strong thank you so much for joining us again we sure appreciate it. thank you appreciate it. time now for a quick break but stick around because when we get back jeffrey tucker the editorial director at the american institute for economic research talks to us

about crypto currencies plus the olympics are over will they have any lasting impact on relations with north korea and as we go to break but here are the numbers of the closing bell markets are all of. the everybody i'm stephen both on the task hollywood guy suspect every proud american first of all i'm just george bush and honored to say this is my buddy max famous financial guru just a little bit different i'm not a lincoln lawyer no no no windows up with all the drama happening in our country i'm shooting the road have some fun meet every day americans. and hopefully start

to bridge the gap this is the great american people. what politicians do something to. put themselves on the line to get accepted or rejected. so when you want to be president i'm sure. most somewhat want to. have to go right to be close to see like them before three in the morning can't be good. i'm interested always in the was in the. first super bowl. i've played for many clubs over the years so i know the game inside i. football isn't only about what happens on the pitch put the final school it's about the

passion from the fans it's the age of the super manager killian erroneous and spending two hundred twenty million on one player. so it's an experience like nothing else i want to because i want to share what i think what i know about the beautiful game but great so one more chance for. the base this minute. on friday we were for the first financial stakeholders to cut ties with the national rifle association the first national bank of almost enterprise holdings parent company to the enterprise alamo and national car rental brands now car rental competitors hertz a vis and budget also have ended their discount programs for n.r.a.

members and air travel delta and united it had ended their discount programs united had been specifically discounting travel to the n r a's annual meeting other big names severing ties with the n.r.a. include the cyber security company semantic met life insurance and simplest safe home security. the supreme court heard opening arguments today in a case that could deal a crushing blow to the public sector labor unions and the labor movement as a whole the case janice vs asked me local council thirty one could result in public workers who benefit from contracts to go shaded by unions no longer having to pay fees that are used to negotiate those contracts and represent workers the ruling in favor of the plaintiffs in the case.