Trennart: It's All About Inflation

Jason Trennart of Strategas Research Partners says there is no good alternative to stocks in today’s low-rate world, and he thinks it’ll remain that way until inflation really starts to kick in. Trennart tells WealthTrack’s Consuelo Mack that the Federal Reserve has pushed investors toward risk assets because of its low-interest-rate, quantitative easing policies. While the Fed’s bond-buying is winding down, he says other central banks — like Japan’s and Europe’s — are picking up the slack. How far the bull runs is largely contingent on how long inflation remains mild, allowing the easing to continue, he said. He thinks that will be the case for at least another year, and possibly two, because wage inflation hasn’t kicked in, global commodity price pressure is not major, and banks aren’t interested in significantly increasing the size of their loan portfolios. Trennart explains why he’s high on large-cap tech stocks and Japanese equities, and how to spot when broad-based inflation starts to pose a risk to stocks.