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And jumped in head first should you Phyllis -- chief equity market strategist with Federated Investors with nearly 31 billion dollars.
In assets under management -- exclusively here to tell us.
-- changed your allocation we did why.
When you take a step back.
We had a very strong first quarter the S&P and Russell were up about 12% that was the best first quarter since 1998.
Going back to last October the large cap stocks were up about 32%.
Small cap stock drop about 41%.
Our -- two weeks ago after that move is that stock to play got a little ahead of themselves we thought we would see something in the order about a five to 10% pullback.
Over the course of the next two weeks.
Culminating in the bottom Tuesday that's exactly what happened large cap stocks pull back about 5%.
The -- small capsule Russell was back about 9% we were getting over sold readings.
We decided to puts more money to work up what I mean how often do you make those kinds of allocation changes.
Not very frequently that's why I think it's interesting that I'm really glad you're here today because a guy like you with that much in assets under management.
Doesn't move in and out doesn't -- a lot -- we will make changes like that three or four times a year but it was such an extraordinary move in two weeks.
The signals were getting were so strong we thought it it it was worthy of -- -- One of those signals Spain showing some serious severe stress their price to cover debt defaults.
Over the past week you know we we have some charts that we can show people but this started to get the market's very concerned in the -- capsule work you could call them Smart people I don't know you know they started to get out of the markets that's what we saw things fell.
About Spanish banks have have gone down certainly and we asked Christine Lagarde the head of the IMF yesterday because of this.
How she felt about Spain and here is what Christine Lagarde have to say about that then you can comment.
They have to do -- potential but communicating what they're doing and they helped to keep up.
You know when we talk about their financial institutions.
They have to recapitalize them they have to.
Sort themselves out to fund may say and they should do it now but they are on the right track.
And I was pleased to hear that the European Central Bank is looking carefully at Spain to see what you can do in -- -- you know facilitate.
The the that that that in.
Stability on the bull market when it comes to -- But that did -- -- that came out today shows that Spanish banks borrowed the most they ever have in the month of march doesn't that concern you.
If you look at the five pigs Greece on -- that Spain is is the country that has the balance sheet essentially in the best shape.
So so from that perspective near term no I I agree completely with what Christine said.
Given our perspective it is inconceivable to us that given everything that's happened euros over the last three years that the ECB in Germany it would allow Spain to fail.
Having gone through all the histrionics that they have to try to get greased back on the right path so.
Is this is this troublesome the near term absolutely but I think we're actually gonna find a resolution of the problem.
Let's bring it back to the jobs report of course last Friday it was a disappointment and there's some question about the quality of jobs.
That are created now post recession you would expect that hey we said goodbye to some higher paying construction jobs but as -- looked at that.
And look at the criticism about the fact that -- we do see job creation equality isn't so great what do you say to that.
I I don't know that I disagree with that -- that if you look at it go through that of -- jobs report that we saw on Friday.
One of -- -- the bright spots clearly was manufacturer.
Your record is -- thousand right.
An -- on a three month basis is the best manufacturing pace of -- we've seen since I believe 1997.
Take a step back.
If you look at the rate of unemployment.
In this country among individuals were educated have skills a college degree and higher the rate of unemployment is 4%.
Are now the economists believe that the rate of unemployment full employment would be approximately 6%.
You look at the rate of unemployment among people that do not have college degrees the rate of unemployment is up around twelve or 13%.
So what that's telling me it's that the people that have jobs right now are the ones that have skills the ones that -- education and in those are going to be -- higher paying jobs.
Where is still putting his newly allocated equity percentage that he is just changed he is coming back up to tell you where he likes.
Putting money at the moment and it might be something you want to hear about for your portfolio with a meantime in case you so much as -- this week.
Here's what you -- right here.
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