The Trend Is Your Friend

The old Wall Street saying, “The trend is your friend,” has played out beautifully over the past few months—at least in the stock market.

However, on Main Street, consumers are starting to show signs of tapping out. And as they do, the trend on Wall Street could reverse suddenly.

One source of alternative data showing consumer stress? Google search trends:

Turn Your Images On

Search words and phrases reveal a surge in consumer anxiety over basic needs. (Source: Google)

These are the folks who have taken a hit in recent years, thanks to the massive income inequality that, according to Treasury Secretary Scott Bessent, the Federal Reserve exacerbates.

Consumers who never bought assets like stocks, houses, or gold are lucky to hold steady in good times – but they risk losing it all in a recession.

With the Federal Reserve making big changes in the monetary system and starting to cut rates again, asset owners like shareholders and homeowners will benefit.

Cash-strapped, debt-addled consumers? They’ll be the first to take the hit from an economic slowdown and the next wave of inflation.

~ Addison

P.S.Yesterday’s Grey Swan Live! with Mark Jeftovic was a powerhouse. We covered the shocking assassination of Charlie Kirk and the #1 forecast we made for 2025: the aggressive rise in political violence.

Then we got down to business, turning to Trump’s Shadow Fed and political pressure to cut rates into inflation.

Portfolio Director Andrew Packer showed attendees how the Grey Swan model portfolio is uniquely positioned for interest rate cuts and why income-generating stocks could see big returns as interest rates on bonds decline.

Mark Jeftovic took us on a deep dive into the crypto market, showcasing a number of cryptocurrency projects that have real-world use cases and could see a big move in the months ahead as the Fed kicks off interest rate cuts. Paid-up readers can access the replay here.

If you’re not a paid member of the Grey Swan Investment Fraternity, you can review the benefits of becoming one here.

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

The old Wall Street saying, “The trend is your friend,” has played out beautifully over the past few months—at least in the stock market.

However, on Main Street, consumers are starting to show signs of tapping out. And as they do, the trend on Wall Street could reverse suddenly.

One source of alternative data showing consumer stress? Google search trends:

Turn Your Images On

Search words and phrases reveal a surge in consumer anxiety over basic needs. (Source: Google)

These are the folks who have taken a hit in recent years, thanks to the massive income inequality that, according to Treasury Secretary Scott Bessent, the Federal Reserve exacerbates.

Consumers who never bought assets like stocks, houses, or gold are lucky to hold steady in good times – but they risk losing it all in a recession.

With the Federal Reserve making big changes in the monetary system and starting to cut rates again, asset owners like shareholders and homeowners will benefit.

Cash-strapped, debt-addled consumers? They’ll be the first to take the hit from an economic slowdown and the next wave of inflation.

~ Addison

Then we got down to business, turning to Trump’s Shadow Fed and political pressure to cut rates into inflation.

If you’re not a paid member of the Grey Swan Investment Fraternity, you can review the benefits of becoming one here.

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

Copper and resources are sending us a cleaner market signal than AI stocks.

Channeling Ludwig von Mises, we observe this morning that price is not just a number; it’s information. Price reflects what buyers and sellers collectively believe: demand, scarcity, fear, speculation, disappointment, future expectations and available supply.

When prices rise, and inventories fall at the same time, the message is usually straightforward: buyers need the stuff, and there is not enough of it.

A low VIX does not predict disaster. It measures complacency. A serial skeptic will read it as the calm before a storm. We shook off that feeling this morning and opted to pursue an opportunity instead.

Here goes:

A VIX reading below 15 means the market is not pricing in much near-term trouble, even though there are obvious risks still sitting in the room: Iran, oil prices, memory chip speculation, circular financing, high valuations, epic high concentrations, spiking long-term interest rates, a regime change at the Fed, a meltdown in Japan and a historic deficit and rising national debt.

Money is not flowing in a clean, straight line from outside investors to productive businesses. The firms at the top are investing in and buying from each other.

Microsoft and OpenAI are the easiest examples to follow.

Microsoft says OpenAI has contracted to purchase an additional $250 billion in Azure services, while Microsoft continues to account for $13 billion in funding commitments to OpenAI as an investment.

At this stage, it’s a stock picker’s market.