Listen to this segment of the show from February 3, 2018
When the stock market falls by 2%, people freak out. It's a pretty dramatic decline, and a reminder that the stock market isn't the economy and the economy isn't the stock market. A one-day decline of 2% isn't sustainable and rarely reflects more than the animal spirits taking over the market. But in fairness, the stock market has been overpriced for a while, according to any conventional and rational sense of valuation.
What we should really worry about is that 4th quarter economic productivity slipped by 0.1%. It's on an annualized rate, so the figure itself isn't big. But the stock market isn't the economy, and the economy isn't the stock market. Stagnant or declining productivity is not a good bellwether for economic strength, no matter what the S&P 500 is doing. The economy and the stock market have been on totally different paths since 2008 -- the economy fell by something around 5%, and has subsequently grown by a total of maybe 20%. The stock market, by contrast, plunged by 50%, and has since doubled.