TABLE OF CONTENTS
Market Recap: Daron Acemoglu on the real threat to American prosperity
EQUITIES: Ted Oakley on the recent market turmoil
EQUITIES: Chris Vermeulen on why a 50 percent correction is coming
EQUITIES: Milton Berg on why the market is nearing the bottom
ECONOMY: DOGE should give a $5k dividend check, says James Fishback
What To Watch
MARKET RECAP
Latest News. On Wednesday, March 19th, the Federal Reserve held its key interest rate within the range of 4 to 4.25 percent.
Fed Chair Jerome Powell said at a same-day news conference, “we think it’s a good time for us to await further clarity,” as the U.S. economy contends with tariffs, deportations, and rapid geopolitical changes.
Thanks for reading! Subscribe for free to receive new posts and support my work.
The Fed’s move was not as hawkish as some economists had feared, and stock markets responded positively. The S&P was up 1.1 percent, and the Dow rose 0.9 percent in intraday trading. The 10-year Treasury fell to 4.257 percent, down from Tuesday’s close of 4.28 percent.
The relief to the stock market was a welcome change, after months of downward action. The S&P is down 3.4 percent year-to-date, and the Nasdaq is down 7.8 percent over the same period.
In other news, Donald Trump became the first sitting U.S. president to address a cryptocurrency conference on Thursday, March 20th, after he virtually spoke to The Blockworks Digital Asset Summit (DAS) in New York City.
Crypto prices fell following Trump’s speech, but have since rallied. Bitcoin finished the week up 3 percent, and Ether rose 6 percent from last Friday to March 21st.
During his speech, Trump vowed that the U.S. would dominate the crypto sector, and that dollar-backed stablecoins would “expand the dominance of the U.S. dollar.”
However, Nobel laureate and MIT Professor of Economics, Daron Acemoglu, said that Trump — despite The White House’s optimistic messaging — risks ending U.S. dominance in the global economy.
Referring to his recent Financial Times op-ed on the threats to American prosperity, Acemoglu said, “I was very worried about the direction that the U.S. economy is taking under President Trump.”
In his Financial Times article, Acemoglu pointed to tariffs that Trump has implemented, suggesting they could cause uncertainty, harm U.S. manufacturing, and spark inflation.
“I wanted to warn against some unthinkable outcome within the next two decades that could happen out of this, in particular loss of U.S. economy dynamism and end of U.S. economic leadership at the global level,” he explained. “My guess would be that those, if they come to pass, would be caused by a combination of the institutional damage that the Trump administration is causing, plus the tech industry.”
Acemoglu said that the U.S. tech industry could lose ground to China, due to inefficient consolidation and worse research support.
“Big tech companies in the United States… pour 100s of millions of dollars, sometimes billions of dollars, into new projects, new ventures, research and development, various types of innovative activities,” he explained. “But they’re not very good at it… The U.S. has an advantage, but if it doesn’t maintain its support for academic research, academic independence, if it doesn’t prevent complete consolidation of the industry, [then] that’s in danger as well.”
Market Movements
From March 14th to March 21st, the following assets experienced dramatic swings in price. Data are up-to-date as of March 21st at 9pm ET (approximate).
Virgin Galactic — up 26.9 percent.
Guess? Inc. — up 23.4 percent.
Celsius — up 21.6 percent.
Reddit — down 9.8 percent.
23andMe Holdings — down 6.8 percent.
The following major assets experienced the following price movements during the same time interval.
DXY — up 0.4 percent.
Bitcoin — up 3.1 percent.
Gold — up 1 percent.
10-year Treasury yield — down 1.1 percent.
S&P 500 — up 0.5 percent.
Russell 2000 — up 0.6 percent.
USD/yuan — up 0.2 percent.
EQUITIES:
’STAGFLATION’ CRISIS: HOW BAD IT CAN GET
Ted Oakley, March 19, 2025
Ted Oakley, Founder of Oxbow Advisors, said that the recent volatility in markets was caused by uncertainty, especially around President Trump’s new trade policy.
“I think [CEOs] don’t know what to do,” said Oakley. “If you’re saying well, you’re going to pay X today, but we’ll change it and you’ll pay half-X tomorrow — oh by the way, four days from now maybe you’re paying 2X… companies have a very hard time with that.”
Oakley said that his firm had taken a “defensive” position amidst this uncertainty, investing in U.S. treasuries to manage risk. He added that he was not impressed with current market valuations.
“We’re very high on current earnings, like 24 times,” he said, referring to markets. “You’re still expensive in this marketplace… People are very, very, highly exposed to stocks — the most I’ve ever seen, really, I have to tell you.”
In response to Trump’s statement that the economy would undergo a “period of transition,” Oakley said that The President is trying to echo Ronald Reagan.
“When Reagan came in, the first 44 days the markets were up, until he got inaugurated, and then we went into basically an 18-month bear market,” said Oakley. “It was over in August of ‘82, but maybe he [Trump] is taking a page out of that.”
Responding to the recent rally in gold, Oakley said that it was driven by dissatisfaction with the U.S. dollar.
“The rest of the world does not want to own the dollar,” he said. “I think they’re saying, you know what, when we have extra reserves we’re going to use a lot of that money to buy gold.”
EQUITIES:
’50% PULLBACK’ IS COMING
Chris Vermeulen, March 10, 2025
Chris Vermeulen, Chief Market Strategist at TheTechnicalTraders.com, said that “today is definitely a panic-selling kind of day,” referring to the March 10th market correction, which saw the Dow fall nearly 900 points.
“This [market] is going back into 2023, 2022 levels,” he said. “There’s a lot of fear. If there’s too much fear, it means a downtrend is likely starting.”
However, Vermeulen said that in the short-term, the selling pressure would cease, and there would be a few more upward trends.
“Overall, most of the downside is done,” he predicted. “We should have some type of bounce up into, like, the March 24th-March 25th area.”
Vermeulen said that, “I think we need a great big correction in the market… we’re primed and ready for another 50+ percent selloff.”
When it comes to asset allocation, Vermeuelen cautioned that gold would experience the same downward action as stocks, and that “there is no safe haven when it’s full-on panic [in markets].”
“Sometimes you need to sit in cash and just wait for an opportunity,” he said. “Gold will collapse with the stock market when there’s mass fear.”
He added that he has bought inverse ETFs, which are negatively correlated with broad market activity.
“As the market just keeps having these waves to the downside… we hop on an inverse ETF,” he said. “As everyone is losing their accounts, our accounts are shooting higher on those days.”
EQUITIES:
BIGGER BUBBLE CRASH AWAITS
Milton Berg, March 8, 2025
Milton Berg, Founder of MB Advisors, said that the market has bottomed, or is at least close to a bottom, for now.
“By virtue of the fact that the S&P 600 peaked back in November, and the 10-day rate of change now is the weakest in 350 days… is another reason to suggest we might be at a low,” he said. “Just based on history, you have to expect that what we’re seeing now is actually the panic that you see at the end of a low, rather than something you face before a crash.”
He added that if a rally were to occur, it would be “very strong,” but short-lived.
“It could be a 5 percent rally or 10 percent rally in small caps,” he said. “I’d say [it’s] likely for a short-term rally [to occur]… It may take some indices back up to above the previous highs on a minor basis, but at this point I don’t think that we’re going to see a continuation of the bull market.”
In terms of asset allocation, Berg predicted that an economic slowdown would manifest, which would benefit long-dated bonds.
“I’m bullish on bonds at this moment,” he said. “We think stocks will go down for the same reason bonds will do well, because the slow down or recession historically is bad for stocks and good for bonds. On the other hand, when you have a government trying to save money, trying to pay down debt, that is certainly good for bonds.”
Berg said that gold, a common safe haven asset, had topped, despite surging past $3,000 recently to reach new all-time highs.
“The argument that gold is going to do well doesn’t hold water,” he said, pointing to various charts comparing gold to housing and economic indices. “You can’t argue that gold is cheap… not relative to CPI, not relative to even housing prices. It’s not undervalued.”
ECONOMY:
$5k DOGE DIVIDEND CHECK
James Fishback, March 12, 2025
James Fishback, CEO of Azoria Partners, explained his DOGE Dividend Check idea as incentivizing “millions of Americans to report waste in government spending that they themselves see.”
The DOGE Dividend proposal, as Fishback conceived of it, involves taking 20 percent of the funds that the Department of Government Efficiency (DOGE) saves, and transferring it back to taxpayers in the form of a check.
“We think DOGE can save $2 trillion over the next couple of years,” said Fishback. “If you take 20 percent of that, as the DOGE Dividend calls for, and send it back to taxpayers… you end up with a check of roughly $5,000 to each taxpaying household.”
He added that the savings would be sent back regardless of how much DOGE actually manages to cut from government spending.
“If the savings are only $1 trillion, which I think is awfully low, the check goes from $5,000 to $2,500,” he explained. “If the savings are only $500 billion… then the [check] is only $1,250.”
Fishback dismissed concerns that these DOGE Dividend checks would cause inflation through higher household spending.
“Polling data from CNBC and JL Partners suggests that 70-75 percent of a DOGE Dividend check like this would not be spent, but would be used to pay down existing debt, and to reorganize household finances,” he said. “If you get a $5,000 check and use that to pay down your credit card bill, or your auto loan payment, that is not inflationary. In fact, paying down debt… is automatically deflationary because it takes money out of the economy.”
WHAT TO WATCH
Tuesday, March 25, 2025
S&P/Case-Shiller Home Price Index — A monthly home price index across major U.S. metropolitan areas, tracking repeat sales of single-family houses.
Building Permits — The number of building permits approved in the previous month.
Thursday, March 27, 2025
Initial Jobless Claims — the number of individuals filing for unemployment benefits for the first time in the prior week.
Pending Home Sales — measures the number of homes under contract to be sold but not yet closed, over the prior month.
Friday, March 28, 2025
Thanks for reading! Subscribe for free to receive new posts and support my work.
Connexion
