james bevan is still with us. also with kamal sharma. at call, what will drive equities higher? james: to me, the corporate earnings picture. a lot of people are surprised at the extent to which equities enjoyed such a strong start to the year, but to me, it was all about the tax cut and jobs act, which is essentially gifting u.s. corporations around five or six percentage point additional earnings. i think the market will move in line with earnings growth, which is why i believe the s&p can get to 3100 points. francine: will money come out of bonds into equities? james: we have not seen any of that at the moment. i do not think it is strictly necessary. i think we will see a reasonable valuation in terms of continued low inflation, moving towards coordinated, super nice growth. tom: james bevan with us on the equity markets. enthusiastic, to say the least. let me bring up the james bevan chart. the dow jones industrial average. what is interesting -- and i will throw this out on bloomberg the move in the the move in 1990's. we have a cur

let's get straight to james bevan. happy new year. nd yields mean for a rotation out of bonds into equities? james: very interesting, bond yields are rising because normal economic growth is improving. we should be pleased that bond yields are rising because the markets are becoming much more confident about normal economic growth. they are both important components. i would say we need to spend time exploring the relationship between real growth and inflation and as long as real growth is rising faster than the inflation, that's good news. i'm not worrying about bond yields for the moment. francine: will we see real inflation in the u.s.? james: i believe we are with nominal economic growth moving up five percentage points this year, consistent with 2.5% growth. against that backdrop i believe we could see 10 year bond yields rise to 3%. i do think to break the 30 year bull market in bonds, the 3% level, not 2.5%. tom: i like the fact that you have moved to nominal gdp. washoneywell announcement one of those ideas to the left of topli

joining us is james bevan, from ccla investment management. nice to see you, james.ome of the competitors of carillion are doing quite well today. balfour beatty, their shares are up. kier group. we talk about the disaster of carillion, it will have a huge impact on many jobs carillion, it will have a huge impact on manyjobs and parts of government, but there are already share prices on the move upwards. suchis share prices on the move upwards. such is capitalism, i'm afraid this isa such is capitalism, i'm afraid this is a destructive process. but plenty of companies will pick up the contracts carillion has had. we do not know the ripple of the failure of carillion in terms of the suppliers and contractors. we will have to wait and see. what you make it all? for a very long time, there have been lots of signs that carillion has been in trouble, so it moved to delay the payment of money to its suppliers. some years ago. people were saying, this is a sign ofa people were saying, this is a sign of a company that is in the first stages of significant trouble. a lot of p