Trends. Markets And the Economy: Collision Course 2025.
By Gregory Mannarino
Trends. Markets And the Economy: Collision Course 2025.
By Gregory Mannarino TradersChoice.net
Immediately moving into 2025, both the bond/debt market and the stock market are on a direct collision course.
Look at the chart below of the Mannarino Market Risk Indicator (MMRI). The MMRI is 100% free to anyone who wants to use it and is available here: https://traderschoice.net/about-traders-choice/
Looking at the MMRI, you will notice two peaks.
The first peak, which occurred in mid/late April of 2024, and then the second is exactly where we are now.
The chart below demonstrates what happened to the stock market/SP500 the last time the MMRI peaked in mid/late April. There was a significant sell-off.
With that, there is no way to accurately say that currently the MMRI is peaking, the MMRI could potentially rise higher from here. (And that is a problem).
Last Wednesday the Federal Reserve cut rates another 25 basis points. With that, the long end of the yield curve from the 10yr-30yr, instead of dropping, did the just opposite. Subsequently, the stock market got hit with the Dow Jones Industrial Average dropping over 1,100 points. In the days immediately following that stock market drop, it tried to recover but couldn’t.
Now gauging from what happened to the stock market the last time the MMRI peaked back in April, this sell-off may just be getting started. It is certainly possible that the Fed. Does intervene here and starts to buy more long-term debt so to push the long end of the yield curve lower, but we have no way to predict that.
We also must assume that the MMRI, which is now on par with what happened in April may rise further still, and this “collision course” with stocks may precipitate a more significant sell off. (The key here is to watch risk, and in my opinion, here the MMRI is a very useful tool which is again 100% free for anyone to use).
What happens to the stock market moving deeper into 2025 is 100% dependent on more easy money policy/lower rates. There remains NO CONNECTION whatsoever between the economy and the stock market. With that, we will see lower rates moving forward as promised by President (s)elect Trump, and promised by the Federal Reserve. With lower rates will come significantly more currency devaluation/loss of purchasing power, meaning higher prices. With higher prices will come a lower standard of living here in the US and around the world. In 2025 central banks will continue to pressure their respective currencies and continue to artificially suppress rates, which in theory should push world stock markets higher/inflating much bigger bubbles. However, there also remains the specter of an uncontrolled sell-off in the debt market which WILL OCCUR at one point, but when? At a point which will be chosen by central banks themselves, who today are both the number one issuers and buyers of debt.
Remember this, “Cash Seeks Yield.” With that, low/artificially suppressed rates will drive cash into assets producing higher yield/greater returns. The entire mechanism of suppressed/lower rates is specifically set up to drive cash into risk assets like stocks. This mechanism could potentially keep the price of commodities down, creating an opportunity to buy more at fire-sale prices.
I expect to see cryptocurrencies go widely more mainstream moving forward AND be added to not just the US Strategic Reserves as promised by Trump, but also other nations will also follow suit. With that, we will see a more rapid push into a new system with more groundwork getting done to bridge the system into full tokenization. Expect rapid deregulation of banks, and a merger between banks and cryptocurrencies-this is THE KEY to implement the new system.
We should all expect to see a continuation of more fake data across the board, and additional economic propaganda ON A MASSIVE SCALE.
Expect to see skyrocketing debt and deficits with the potential for supply chain disruptions AND a severe economic slowdown. With that, there is the potential to see NEGATIVE rates.
Moving into 2025 we will see a continuation of the same wealth transfer mechanism which has led not just the US, but the world middle class population to where it is now. The effect of currency purchasing power destruction brought on directly by artificially suppressed rates is an economic wrecking machine, while at the same time pushing more wealth up to the elite, (the 1 and 2 percenters).
If, as you say, the banks and the crypto bunch merge together then surely that is a clear signal that they mean to entice everyone into this digital system. They will then, instead of BTC being outwith their control it will be fully controlled by the government /Fed. By driving suckers into this crypto world they will entrap them. Otherwise why on earth would the Fed promote something that is in direct competition to the US dollar. Also, why are none of the big players buying BTC. They're all buying and stacking GOLD along with all the central banks. Not one is buying BTC. BTC is Not backed by anything, nothing, nowt, nada so it has no tangible value. It only value is derived from a garbage fiat currency that is losing value every day, and has been since Nixon took it off the gold standard. So far the US Dollar has lost 98.9% of its value. So please, tell me, like I am 5, as to how anyone can say BTC is a currency with value. I just don't get it. A bunch of letters and numbers all jumbled up together backed by absolutely nothing except some gezzer saying it is so, and everyone falling for it🤷🏻♂️ It's like the dot.com era with j-works all over again, as Alasdair Macleod pointed out earlier today. People are going mad buying anything straight into the biggest bubble in the history of the financial world, ever and it's going to go bang very shortly. Thousands of people are going to lose everything. They won't have the chance to log into their trading accounts because those in real control will shut off access to the "system" just like when the markets dropped not that long ago. Hundreds of people couldn't get access to their trading accounts. They couldn't log in for hours or longer. They just watched as stock etc fell and their was nothing they could do. It'll happen again, only this time it will be catastrophic for the masses. By the time they realise what is happening the elite will have cashed out hours ago and bolted for the safety of gold leaving a trail of destruction in their path. Those lucky to scrape through and salvage something before heading for the safety of the PMs will find gold at a price level that will stun them. Silver will be their only option left as all the garbage fiat currencies tank taking derivatives, crypto and BTC with them. Will Saylor buy gold?
By participating in their crypto system, WE enable OUR OWN slavery. I don’t know why Greg keeps pushing this nonsense -you can’t buy shit with it, and when you want to cash out to buy something, you cash out into the same fiat paper currency AND pay tax on. Where’s the appeal here, that it will somehow “keep up with inflation”?
It’s a game, and once again, one THEY control.
Latest stats: 1.86% of all Bitcoin wallets control +95% of all Bitcoin. Dude, anyone playing this game is owned lock stock and barrel by THEM. At least the gold and silver is yours with ZERO counterparty risk.
Other than that, great article to keep us up to date. They’ll do another “pandemic” probably the CyberPandemic they’ve been advertising for the past few years. Zero-out cryptos or exchanges and have people line up for FedCoin…