Markets are throwing off some very negative signals about the U.S. economy. However, with economic data remaining relatively strong, the overhanging question is whether investors will begin to take those bad signs to heart.
Crude oil, typically taken as a barometer of industrial and consumer demand, continues its incredible plunge. The critical commodity has lost some 60 percent of its value in the past seven months, falling to levels not seen since the depths of the financial crisis in 2009.
Meanwhile, Treasury yields plumb new lows, with the 10-year yield falling below 1.7 percent on Friday even as the Federal Reserve looks to hike short-term rates. Across the Atlantic, German 10-year notes are yielding about 0.3 percent, and the Swiss 10-year yield is actually negative.
"If Rip Van Winkle were to wake up today and see where oil is and where bond yields are...he would be very tempted to say that we must be in a recession," said Nicholas Colas, chief market strategist at Convergex.
But of course, the U.S. is not in a recession. Even though Friday's gross domestic product (GDP) number showing annualized growth of 2.6 percent in the fourth quarter was a bit of a disappointment, full-year growth came in at 2.4 percent.
Separately, the employment numbers have been even better, which is set to be confirmed on Friday, when the Bureau of Labor Statistics is expected to report the 12th straight month of 200,000-plus gains in nonfarm payrolls.