I always think of the economy as going down a pretty broad road that has mud on either side - for inflation and deflation. What hurts the market is when we unexpectedly swerve into one of those mud banks.

I always think of the economy as going down a pretty broad road that has mud on either side - for inflation and deflation. What hurts the market is when we unexpectedly swerve into one of those mud banks.

There's an old line that goes, the truck you see 400 yards down the road is not the truck that hits you. When we see these problems coming, they usually get defused. Brexit may have been a surprise, but we recognized it as something that could possibly happen.

The other kind of market like technology is healthcare. Nobody likes the healthcare industry, but on the other hand, everyone wants to live longer. The way I look at it, there's going to be tremendous pressure with healthcare as a percentage of GDP rising with new technology, an aging population, and a business model that basically keeps people alive longer to consume more healthcare products.

Both cream and scum can rise to the top, unfortunately. This lower-quality stuff that's going higher isn't doing it on fundamentals.

What caused 2008, in my opinion, is that people just didn't see the risk. These people that took on all this risk didn't think they had it - they thought they hedged it all away. As long as there's a perception of risk, and a culture of looking for risk, it's going to be hard to deflate us.

The fact that the bond market is rallying today is a plus. If this ends up being a bear market, it will be one of the first ever that began when interest rates are down.