There's the taper. There's bad data from China. There's chaos in emerging markets from Ukraine to Argentina. There's weak US data. Yet, the market is still close to its record-highs despite the drop on Monday.
Krishna Memani, Chief Investment Officer of Oppenheimer Funds, is responsible for $237 billion in assets under management. According to Memani, the selloff in "highflying" stocks such as Tesla, Netflix, and Facebook is not necessarily a bad sign.
"The highflyers were rising because there were some questions about whether the underlying growth in the economy would continue," says Memani. "If the economy wasn't going to continue [to grow], people were willing to pay a high price for high growers."
With the cold weather winding down in North America and a potential economic rebound, highflying stocks could expect to be sold as they were on Monday, with investors looking to other stocks in the market, according to Memani.
"The reason that this adjustment is taking place is that we think the economy will continue to grow," says Memani. "If you had a set of market conditions where only highflyers were rising and the rest of the market wasn't, I think that would be far more problematic than the current situation."
Two months ago, Memani told investors that there were four unlikely events that could nonetheless shake the markets were they to occur: A housing market double dip, an emerging markets rebound, a Japanese yen rally, and wage increases in the US. While Memani sees the first three scenarios as having almost miniscule chances of occurring, he sees wage increases as the one with the best chance off happening.
"I think what we ought to be watching for are things in the US," says Memani. "Is the economy growing? Yes. Are wages growing? No. If either of those two changes, I think that's what brings down the US market more than anything else."
"If wage inflation materializes, then the entire game changes," says Memani. "All the conversations that we are having about inflation being low and trending lower…. goes out the window. So, the environment for the markets, the environment for the economy changes dramatically and I think the Federal Reserve will react quite quickly."
To see the full interview with Oppenheimer Funds CIO Krishna Memani on what's ahead for the markets, watch the video above.