JUST IN: 🇺🇸 Treasury Secretary Bessent says the entire economy is not at risk of recession. ...

Core Viewpoint - The current U.S. equity market, particularly in tech and AI, is experiencing a dangerous bubble reminiscent of the late 1990s Nasdaq bubble, with high valuations and compelling growth narratives, but the circumstances surrounding this cycle's potential collapse are fundamentally different, which could lead to a more severe economic impact [1][3][4]. Market Valuations - Some U.S. tech companies are trading at over 30 times forward earnings, indicating extremely rich valuations that echo the TMT sector's capital investment frenzy in the 1990s [1]. - The absence of a tightening monetary policy from the Federal Reserve, which typically serves as a catalyst for a bubble's demise, raises concerns about a prolonged market melt-up [4][6]. Economic Vulnerability - The current economic landscape is more vulnerable than during previous bubbles, as the wealth concentration among high earners, who are heavily invested in equities, drives a significant portion of consumer spending [7][8]. - A potential stock market correction of 25% or more could severely impact consumer spending and the overall economy, highlighting the risks associated with the current market dynamics [7][8]. Retail Investor Participation - The widespread participation of retail investors, encouraged to "just buy the dips," poses a risk as this belief in perpetual market growth could lead to significant losses during a market downturn [8]. - The concentration of wealth among high earners, inflated by the stock market, raises concerns about the broader economic implications of a market correction [8]. Historical Context and Predictions - The analyst has a history of bearish predictions, including calls for major market crashes, and emphasizes that the current market conditions are overdue for a correction, given the absence of a recession since 2008 [9][10]. - The long-term risk of inflation in the West, driven by fiscal irresponsibility, could lead to a scenario where central banks resort to quantitative easing, exacerbating economic vulnerabilities [11][13]. Private Equity Concerns - The private equity sector, benefiting from low bond yields and leverage, is seen as highly vulnerable to shifts in the economic environment, with recent bankruptcies indicating deeper systemic issues [15][16]. - The metaphor of "credit cockroaches" suggests that these bankruptcies may signal broader problems within a highly leveraged sector that has significant ties to the real economy [15][16].

Core Insights - The yield on the 10-year Treasury note was 4.06% as of November 21, 2025, with the 2-year note at 3.51% and the 30-year note at 4.71% [1] - The inverted yield curve, where longer-term yields are lower than shorter-term yields, is a reliable leading indicator for recessions, typically turning negative before recessions [2][3] - The average lead time to a recession based on the first negative spread is approximately 48 weeks, while using the last positive spread date yields an average of 18.5 weeks [4][6] Treasury Yield Analysis - The 10-2 spread has shown multiple instances of turning negative before rising again, particularly noted before the 2009 recession [3][5] - The 10-3 month spread also indicates a similar pattern, with a negative spread observed from October 25, 2022, to December 12, 2024 [5] - The Federal Funds Rate (FFR) influences mortgage rates, with the latest 30-year fixed mortgage rate reported at 6.26%, one of the lowest levels in over a year [7] Market Behavior - Federal Reserve policy has significantly influenced market behavior, particularly in relation to Treasury yields and mortgage rates [8] - ETFs associated with Treasuries include Vanguard 0-3 Month Treasury Bill ETF (VBIL), Vanguard Intermediate-Term Treasury ETF (VGIT), and Vanguard Long-Term Treasury ETF (VGLT) [9]

Group 1: Nvidia Earnings and Market Reaction - Nvidia reported strong earnings with a 66% growth in data center revenue, exceeding expectations [4][5] - Despite initial gains, Nvidia's shares finished lower, reflecting market concerns about the economic situation and potential AI bubble [5] - The Bitcoin market is experiencing a downturn, with Bitcoin dropping below $83,000, marking a 33% decline from its peak [6] Group 2: Retail Earnings Overview - Home Depot's shares fell 6% after missing earnings expectations and cutting guidance due to a cautious outlook on consumer spending and a soft housing market [8] - Lowe's initially dropped in sympathy with Home Depot but later rebounded after beating earnings expectations, although it remains cautious about the economic environment [9][10] - Walmart's shares rose 6% following strong earnings driven by e-commerce and international sales, while Target's shares declined due to a third consecutive quarter of declining comparable store sales, down 2.7% [11][12][13] Group 3: Fintech and Consumer Lending Sector - The buy now pay later fintech sector is under pressure, with Klarna reporting a loss and a significant increase in provisions for credit losses, leading to a 16% decline in its stock [14][15] - Competitors like Affirm and SoFi also saw declines of 13% and 10% respectively, indicating concerns about consumer delinquencies [15][16] Group 4: Economic Data and Job Market - September jobs data showed an addition of 119,000 jobs, but the unemployment rate rose to 4.4%, primarily due to more people re-entering the job market [17][18] - Revisions to previous months' job data raised recession concerns, with August now showing a loss of 4,000 jobs [18][19] Group 5: Tariff Rollbacks and Federal Reserve Signals - Recent tariff rollbacks are seen as a response to economic pressures, with the Fed's stance on potential rate cuts becoming increasingly mixed [21][25] - Market expectations for December rate cuts have fluctuated significantly, reflecting uncertainty in economic conditions [25][27] Group 6: Upcoming Economic Events - The upcoming Thanksgiving week is expected to bring lower market volume and potential volatility, with a flood of economic data and earnings reports anticipated [28][29] - Black Friday will provide crucial insights into consumer spending behavior and retailer performance as the holiday season approaches [33][34]

A recession would put indebted governments everywhere to a stern fiscal test https://t.co/T0yykpqpEW ...

LATEST: 📊 Financial markets are in a late-cycle stage and not facing an immediate recession, according to QCP Capital, which says Bitcoin is becoming increasingly sensitive to broader macro shifts. https://t.co/htUJHAW56Y ...

LOGIN SUBSCRIBE | FastCo Works advertisement BYÂ Jennifer Mattson Listen to this ArticleMore info 0:00 / 0:00 The gap between the richest and poorest Americans is widening in what Federal Reserve Chairman Jerome Powell has called a "bifurcated economy,†as the cost of living skyrockets from housing to food prices, but wages for most workers remain stagnant. Basically, high-income individuals are doing well, while lower- income consumers are struggling more and more. That situation has sparked discussions abo ...

Markets in Late-Cycle Phase, Not Recessionary: QCP► https://t.co/vlOG0zYEsR https://t.co/vlOG0zYEsR ...

Core Insights - A majority of Asia-Pacific institutional investors anticipate a market correction in 2026, primarily due to concerns over a potential tech bubble, geopolitical tensions, and recession [1][2]. Group 1: Investor Sentiment - 74% of institutional investors globally believe a correction is overdue, with 80% in the Asia-Pacific region sharing this sentiment [2]. - Among Asia-Pacific investors, 48% cite the potential for a tech bubble as their top concern, followed by geopolitical shocks at 45% and recession at 40% [3]. - The sentiment indicates that markets may face challenges in the upcoming year, as noted by Natixis Investment Managers [5]. Group 2: Investment Strategies - Approximately 60% of investors in the Asia-Pacific region plan to increase their allocations to equities within their home region to diversify away from the US market [6]. - Only 25% of global investors intend to increase their allocations to US equities, compared to 44% for Asia-Pacific equities and 42% for emerging market equities [8]. Group 3: Market Outlook - Views on the Chinese market are cautious, with three-quarters of global and Asia-Pacific investors indicating that slow growth is the "new normal." However, 70% of Asia-Pacific investors believe China can withstand a prolonged trade war with the US [9].

Market bear John Hussman's firm said it's watching six signals in the job market that could indicate a recession. The firm pointed to trends like AI-driven layoffs and job losses in key sectors. Hussman is known for his bold and frequently cataclysmic calls about the economy and markets. There's a key report investors should be mining this week for recession warnings, according to the investment arm of one notorious market bear. Hussman Strategic Advisors — the investment advisor led by the famed p ...