One Data Point Closer to a “Terrifying Bull Market”

This morning’s Producer Price Index (PPI) shows that inflation is still with us.

While traders were betting that the Fed would cut interest rates next month, that’s being rethought today. And with a rate cut already priced into markets, prices are trending lower.

Given how far markets have already gone, the prospect of interest rate cuts isn’t bullish for the economy – it’s actually bearish. It’s a sign that the real economy is struggling and needs cheaper access to capital.

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Markets are overpricing economic conditions and could be ready for a big pullback (Source: X/Twitter)

The staggering 0.9% month-over-month increase shows that inflation isn’t going away – and may be about to accelerate.

If so, that could cause conditions for a crack-up boom – or what Mark Jeftovic refers to as a “Terrifying Bull Market” – a stock market that rallies, but because investors are trying to get out of the dollar by any means possible.

Today’s data print isn’t the end of the world – the market isn’t even down that much this morning. But it’s one more nail in the coffin for the value of the dollar.

~ Addison

P.S. Some companies are thriving under the shifting tariff regime — and from other Trump policies that are decidedly pro-growth. But “pro-growth” also means you need lower interest rates. At least in the Trump Great Reset playbook.

The tricky part? Government printing debt out of thin air usually means more inflation. Under normal circumstances, the Federal Reserve would be leaving rates unchanged in September… or even raising them.

Therein lies the pickle we’re in.

You can’t let interest payments on the existing debt swallow the government budget. This means that, in addition to “pro-growth” economic strategies, you need lower interest rates.

But lower interest rates also mean higher consumer prices for necessities like energy, food, housing, health care and tuition.

The bond market doesn’t like deficits or debt, either. Investors demand higher interest rates to lend the government money.

Like we said, it’s a pickle.

We’ll be digging into both sides of that equation — plus our latest research — in this week’s special session of Grey Swan Live! tomorrow, Friday, August 15, 2025… exactly 54 years since Nixon “closed the gold window.” Members will get the sneak peek before anyone else.

As always, your reader feedback is welcome: feedback@greyswanfraternity.com (We read all emails. Thanks in advance for your contribution.)

This morning’s Producer Price Index (PPI) shows that inflation is still with us.

While traders were betting that the Fed would cut interest rates next month, that’s being rethought today. And with a rate cut already priced into markets, prices are trending lower.

Turn Your Images On

Markets are overpricing economic conditions and could be ready for a big pullback (Source: X/Twitter)

The staggering 0.9% month-over-month increase shows that inflation isn’t going away – and may be about to accelerate.

Today’s data print isn’t the end of the world – the market isn’t even down that much this morning. But it’s one more nail in the coffin for the value of the dollar.

~ Addison

Therein lies the pickle we’re in.

You can’t let interest payments on the existing debt swallow the government budget. This means that, in addition to “pro-growth” economic strategies, you need lower interest rates.

But lower interest rates also mean higher consumer prices for necessities like energy, food, housing, health care and tuition.

The bond market doesn’t like deficits or debt, either. Investors demand higher interest rates to lend the government money.

Like we said, it’s a pickle.

As always, your reader feedback is welcome: feedback@greyswanfraternity.com (We read all emails. Thanks in advance for your contribution.)

Bitcoin isn’t a trade and trying to time it with chart patterns generally does not work.

I’ve never really felt like technical analysis carried much real predictive edge in general and when it comes to BTC, I’ve seen too many failed “death crosses” to change my opinion.

The one that just triggered in mid-November as bitcoin flirted with $90,000 is just the latest.

What really matters? It’s a monetary regime change – if market participants are trading anything it’s getting rid of a currency (“it’s the denominator, stupid”) for a store of value – and we’re seeing it in spades with Bitcoin and gold.

White-collar hiring is, in fact, slowing. Engel’s Pause is taking hold of the jobs picture.

In the meantime, everyday Americans are rediscovering an ancient truth: there is wisdom in wearing steel-toed boots.

Jobs that struggle to attract bodies in boom times are now seeing stampedes of applicants.

– Georgia’s Department of Corrections: applications up 40%.

– The U.S. military: reached 2025 recruiting goals early.

– Waste management staffing: applications up 50%.

For now, economists call this “labor market tightness.” Anyone who has ever scrubbed a grease trap knows it by another name: fear.

Bitcoin has historically weathered 30%+ corrections while still in a bull market.

Global liquidity fears and lower odds of a Fed rate cut in December are driving bitcoin and other cryptos lower at present.

As Andrew Zatlin described on Thursday’s Live! we can expect a series of stimulus efforts next year, ahead of the midterms, driving new liquidity. The $2,000 “tariff rebate” checks President Trump has been touting are but one example.

When higher liquidity hits the market – in whatever form it takes – today’s bitcoin buyers will be waiting.

Make like the whales, and use market selloffs and stimulus to your advantage.

The market seems to know something about private credit that we don’t. And in a big enough liquidity event for private credit, investors will have to sell off more liquid assets if they want capital.

That’s the danger private credit poses today, exactly at a time when rules are being eased to make it easier for retail investors like us to buy into this asset class.

I’m in the camp that this smells like a way to keep the party going by providing another source of liquidity – the passive investment flows from your regular 401(k) contributions. The smell takes on a sour note as this sector starts to falter.

Perhaps today’s selloff is simply a reaction to declining interest rates, the growth of private credit, and a few inevitable deals that have gone sour recently.