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Ripple Effect

Consumers Got the Memo

Loading ...Addison Wiggin

November 12, 2025 • 1 minute, 27 second read


Debt to assets

Consumers Got the Memo

Although consumer debt is at an all-time high, consumers themselves got the message during the last crisis: Pay down debt, own more assets.

That’s taken the U.S. household debt-to-asset ratio to levels last seen in the 1970s, around the time the U.S. went off the gold standard:

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Households, unlike government, have paid down their debt and benefited from rising asset prices (Source: FRED)

Contrast that with government. The U.S. government, still enduring its longest “shutdown” ever, managed to grow its debt by half a trillion dollars – while its doors were officially closed!

Rising government debt, moreso relative to GDP than the total value, is on the precipice of full-blown crisis level. When the government gets into trouble, households need to be prepared.

We expect the end of AI buildout euphoria in the stock market may be the catalyst. What you can do right is get your own financial house in order. Pay off debt. Own hard assets. Don’t borrow to invest in the stock market.

~ Addison

P.S. We’ve invited Bloomberg’s #1 employment analyst Andrew Zatlin, to join us tomorrow on Grey Swan Live! for obvious reasons:

Andrew Zatlin — the #1-ranked economic forecaster on Bloomberg and one of the most connected data minds in finance.

For decades, Andrew has helped billion-dollar hedge funds stay three steps ahead of Washington’s chaos, consumer shifts, and global supply chain shocks.

As unemployment ticks up, politicians trade on insider intel, and Pelosi closes out an era, he’ll reveal what his data is signaling next — and what investors should prepare for.

If you have requests for new guests you’d like to see join us for Grey Swan Live!,  or have any questions for our guests, send them here.

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The Debt of Intelligence

November 12, 2025 • Addison Wiggin

SoftBank offloaded its entire $5.83 billion Nvidia stake to bankroll an even bigger gamble: tens of billions in OpenAI.

Son insists this is his next Vision Fund moment.

OpenAI’s swelling valuation doubled SoftBank’s profit last quarter. He may have sold the pickaxe factory, but he’s betting the mine still goes deeper.

The Debt of Intelligence
Dan Denning: The Hollow Class, Part I

November 11, 2025 • Addison Wiggin

A 50-year mortgage doesn’t make housing cheaper. But by stretching the repayment period over time, it DOES lower the monthly payment on your principal. That lowers the percentage of your total income you’re spending on repayment. And in a strange way, it makes sense.

With a fixed rate mortgage and inflation running in the high upper digits, the real value you of your total debt goes down over time (inflation pays off your loan, as long as your income rises faster in nominal terms). Of course you pay off a lot more interest over 50 years than 30 years. And it takes a lot longer to build up equity (assuming also that house prices don’t fall).

Dan Denning: The Hollow Class, Part I
An Armistice of Convenience

November 11, 2025 • Addison Wiggin

Last night’s 60–40 Senate vote shoved the government back toward “on.” There’s apparently a shutdown truce… for now.

A bloc of Democrats “crossed the aisle” after weeks of getting nowhere on health-care demands. “We had no path forward… and SNAP beneficiaries were losing benefits,” Sen. Tim Kaine, one of the 7 who conveniently aren’t up for reelection, said.

The new deal funds Washington only through January, tacks on three bills to keep parts of Defense, Ag, and the Capitol complex humming through 2026, reverses shutdown-era RIFs, and restores back pay.

The House is next; the president says he’ll sign it fast when it gets to the Oval Office.

An Armistice of Convenience
The Quality Stocks Index Is A Screaming Buy… For The Long Haul

November 11, 2025 • Addison Wiggin

The S&P 500 Quality Index ranks companies not by market cap or a compelling AI story, but rather by fundamentals. Earnings, profit margins, and financial leverage. Reasonable debt.

You know, the kind of stuff that makes your eyes glaze over. And the type of companies we like to hold for the long haul in our model portfolio.

The Quality Stocks Index Is A Screaming Buy… For The Long Haul