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Addison Capital CIO Michael Church on why the European debt crisis is impacting U.S. markets.
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Truly be worried even if you have no exposure to Europe.
That the ECB the European Central Bank might potentially play a larger role.
Let's bring in Michael church he's president and chief investment officer at some capital and he says yes be worried about -- you know with with half a billion in assets under management.
I don't know what your exposures let's talk about that but also how to -- your investors and say here's how we protect you in here so we're keeping -- I'll miss.
Well clearly do the best you can to avoid a situation like this but let's be serious about this this has been fairly -- -- thing.
There's not a lot of asset classes that have provided any kind of cushion from what's gone on the last few months so.
It in a way it's unavoidable particularly if you're careening towards some sort of collapse in Europe which -- We don't think it's something that's on the radar OK but looking at the bond yields and you watch this very closely the Italian bond yield showed extreme severe stress.
Just in the last couple of weeks spiking above 7% slightly below that I believe today but what I want have to be looking at -- -- -- -- Coke and Pepsi and McDonald's.
Well it -- global financial system is.
Tightly woven together.
And unfortunately for better worsen matters you see deleveraging occurring as a result of all of this and it affects Alaska telling -- to watch -- many things say it is there something in particular a flashing red light that you say look out.
No but I think one of the things that we're paying attention to -- to what actually was discussing earlier for what's on top next week.
We're really watching with the ECB doing you need a lender of last resort it's very simple here and intermediate term to kind of stamp out what's going on there into the fiscal union talk that's great.
But you you know that that's more the longer term plan let's turn to the American consumer.
And -- we get the consumer sentiment in the consumer confidence numbers.
You're less interested in what they're saying through those surveys vs what they're doing here watch what they're doing now what they're saying.
It's kind of fascinating what you're seeing in the data you know you had a few weeks just a few weeks ago you -- a consumer sentiment number that was lower -- -- around what we saw all in the fall 2000 and it.
After the Lehman collapse.
Yet at the same week you had retail sales that we're moving higher.
And you continue to see these numbers where retail sales you know looking OK all sorts of economic data looking okay.
-- -- -- looking awful.
They've both can't be right.
And I think at some point here we're gonna need to see the rubber meets the road and in which one is telling the true story well a guy like you can juggle all of this correct yeah you can juggle it.
The average investor what is the number one thing they should be doing right now to position.
Well I would take a look conceived very simply how holiday sales are going you know it it does this consumer show up does the Santa arrived here -- and here you see the consumer follow through kind of along that line if you know.
Keeping away from what did to surveys are saying but what the actual -- -- -- and remember we -- this jobs number today for the month of November it's the 21.
Consecutive months.
21 consecutive month where we've seen some type of private sector payroll growth so.
You know you -- slice of number anyway you want -- some profound issues with that I -- it but it's still we'd rather take that to leave it actually had had said this for sometime now all these employment numbers for really the past year there's been something for the bulls and the bears.
You can argue all day eight point six well you know -- were dropped out of the workforce.
Well yes but at the at the end of the day we're still adding jobs for -- have a.
