The economy's buffer is shrinking. Can you feel it?
The warnings aren't necessarily screaming collapse... but the margin for error is getting very tight.
Bank of America is encouraging investors to “take profits.” In a note on Monday laying out their bear case for the S&P 500, they said, “We see opportunity in S&P 500 stocks, but not the overall cap-weighted index.”
Goldman Sachs says we’re this close to a stock market bubble, driven by enthusiasm over artificial intelligence.
Société Générale is warning that oil prices will need to rise moving forward, as global inventories are depleted and strategic reserves require rebuilding.
Meh! Analysts issue warnings all the time. Better yet, each of these signals can be explained away on their own.
However, when taken in the aggregate, and coupled with the many other apparent (and not necessarily bullish) signs and signals, they point to the fact that the economic buffer that has sustained Americans thus far is shrinking.
For the past several years, we’ve all witnessed the economy survive one shock after another: lockdowns; inflation; supply chain stress; war; political instability; consumer exhaustion; market mania. Somehow, almost inexplicably, the engine keeps running.
(Has anyone noticed any slowdown in purchasing activity at the local Costco or Sam’s Club? The team at Collapse Life hasn’t. All these folks surely aren’t there just for the free samples. Leave a comment as to how things look where you live.)
A resilient system absorbs shocks because it has depth, redundancy, savings, trust, and room to maneuver. An exhausted system keeps going because it has no other choice. In other words, fumes still count as fuel… and that’s where we appear to be at the moment.
When signals start flashing across markets, households, restaurants, oil, debt, and geopolitics at the same time, it is worth listening to people who have spent a lifetime watching cycles unfold.
This Wednesday night, paid subscribers are invited to join us for a live conversation with Peter Grandich, the original “Whiz Kid of Wall Street,” who has spent more than 40 years riding the market roller coaster.
Peter has seen bubbles inflate and panics unfold. He has been right. He’s been wrong. And after four decades in and around markets, money, debt, gold, risk, and human psychology, he brings perspective, which these days is far more useful than certainty.
Our gathering on Wednesday will not include crystal ball predictions. That’s not the point at all. What is the point — and why we’re thrilled to have access to Grandich Gray Matter — is to ask better questions so we can anticipate what may be coming.
What is the market really pricing in? What is it ignoring? Where is the stress showing up first? How should ordinary people understand the gap between official confidence and lived reality? And what has Peter learned from decades of watching people lose their heads at exactly the wrong moment?
Come gather some wisdom from someone who has seen a lot.
Wednesday night.
Paid subscribers only.
Click below to upgrade.
Hope to see you there.