Rocketing into 2026

While the entire US Economy crumbles, it seems like America and the world will be betting on a small sector with massive speculation.  The charts and the politics all point to no holds barred suck everyone into a market uptrend that will make the last 2 years seem quaint.

The only reservation I have is the American consumer and middle class are being marginalized.  But in the new world ahead, I don't think American middle class matters to the financial markets.

What will matter is using AI to reduce labor, increase productivity, and advance capabilities in a winner take all run.  The number of relevant public companies in this sector is small, with a material amount of private equity funding the core beneficiaries.

With less stock to purchase that is relevant, with massive money waiting fora  downturn that never came, I can see upwards of a 25% market gain from here to EOY, as insane as that sounds to you, its even crazier for me.

So while I can't advise go all in on this sentiment, I can say, you have to be in it to win it.

My last post listed some of the companies I am in, I will be closing out my shorts (most against specific companies) and look for long opportunities.  I didn't bet big on IREN and CIFR for the AI/Bitcoin datacenter play (I sold early), I am eyeing up HIVE as it hasn't made a run yet.

Stocks I like still is HIVE, FBTC (Bitcoin), SMR, TSM, URA, OKLO, SLDP.

Best I can say is good luck! Unless SPY closed below 663, there is absolutely no reason to be bearish.

Rocket into 2026

Today is "Turn around Tuesday" closing higher than Monday any day this week, and I agree with below.

The S&P 500 (SPY) has closed above 666 for multiple days, solidifying its advancement.

The red line is the SPY relative to dollar value, and the green/red bar line is the SPY.  Last week the market made a new high in US Dollar value terms.  That means up until last week, the most global purchasing power your life saving was lower since January of 2025  even though the SPY was much lower.

In any event, everything points upwards.  We may in-fact see a market parabolic up into 2026.  The consumer and employment numbers are not good, inflation is being sticky, electric energy prices are poised to remain high and continue higher.  But none of the USA negative attributes matter.  At the end of the year is when the US spends beyond its means (borrows) into the economy, and the market is showing signs of bullish.

I expect crypto to explode upwards, energy stocks, and the current fad sectors.    The only thing I see negative is even I have materially reduced shorts (not zero).  The market tends to top when even the bears buy in.   Big money, such as investment funds, have been selling and reduced their market exposure.  It is possible they give in, and start buying to not miss out into the end of year.

This all changes nothing about the end game, this ends in tears, the us economy is in shambles, people are bankrupt, unemployed, priced out of housing, the staple costs exploding up, healthcare about to double.  In effect the US as the worlds consumer is about to end, and that was a key attribute the world had become dependent on.

Key holdings: FBTC, RGLD, HMY, BKKT, CIFR, FETH, FBTC, SMR, TSM, URA, INTC, OKLO, SLDP. buying HIVE

Key international:  INDA, SHLD, EZA, EWW, EFAV, EWL (Switzerland, not a growth play), 

Key shorts (limited size): LOW (option bear call spreads), STLA (puts from Sept 2024),  CNI, SLG, FNGD.

SPY 666

Back in March 2009, spy exact bottom was 66.6#.  I still remember that day.   Tuesday, SPY hit 666.##.

As my previous post, a material close above this number for a couple of days indicates we are facing a crisis event with a market collapsing up.

Alternatively, some sort of universal anomaly with an odd market top.   Either way, I am looking over next few days for the decision .

Part of the market driver is the under reported collapse of the dollar.   Everyone should be aware that people buy dollars for wealth storage due to their confidence in USA future.  What has changed ?!?!?

Decisions being made

Parabolic Blowoff

Strap in, the market may have an uncontrollable epic parabolic move up, with a terminating event.
Long the market should be excellent, providing you can get off at the right level.

If we end above S&P500 666 today, there is really no reason for the market to go down until everyone is in, with full saturation of buyers.

Challenges Ahead

The Federal Reserve under Greenspan in the 90's made a fatal mistake.  He signaled the Federal Reserve moved from stability to helping the economy.   Most people see nothing wrong with the Federal Reserve helping the economy.  But in a capitalist society, and wanting to avoid government intervention into the public sector, the Federal Reserve should have maintained its disposition.   Once he lent a helping hand, politicians and the public switched to view the Fed is the driver of the economy.

This lead to politicians not being accountable for the economy, and to point to the Fed.  Stock market, Bond rates, asset processes are suppose to reflect the economy health as signals to politicians.  Then Politicians adjust policy and lead the country forward. 

Leadership is hard, easier to ask someone else to kick the can.  That has landed us to today.
At some point, can kicking won't work.  There IS one exception to this view, if the economic model changes.  AI has the potential to be so impactful the economic rules I am viewing no longer apply.
Until AI has invaded the economy sufficiently, the older economic model is the guide.

There IS the possibility that the can kicking is sufficient to switch to a newer AI economic model, though I give this a low probability mainly due to multi-front resource constraints.

To me, Ray Dalio is the most articulate of the future view excluding AI rewriting the economic model.  And I completely agree we must suffer in the USA and UK economically to force change.  This will happen when the fed tries to kick the can, and it can't.

Banking Sector Timebomb

We see complete disregard for the US Constitution (Executive, legislative,  and Judicial) separation of powers, and each branch not fighting to retain legal boundaries.   It is reasonable expected that legal lines in US financial markets will not be honored.   I do expect extend and pretend to be financed by the federal government.  China is on the precipice of financial failure due to their corrupt financial markets.  The US looks to recreate that mistake, however, it may take a few years until the markets fail.  I do expect the US Dollar to reflect this through relativity, and value of the dollar to Bitcoin, Gold, and some countries.

It is very rational to be 100% invested in the US stock market right now, providing you can time stepping off the elevator before the cord is cut.  I am trying to hedge US financial system reliance with investing in the world and alternative assets, and yes, target US companies.

This is quite a detailed video, but he is trying to communicate some of the shell games going on.

AI Investment Bubble

We have the makings of the AI investment bubble popping.  The popular news is sending out information reflecting a negative POV for AI development.   Without AI excitement, there is not much else to promote US stock market upwards.  

Inflation is crunching all US citizens, and inflation is going to be here for years.  Until US administration decides to tax the rich instead of put heaver taxes (tariffs) on the bottom 99%..   Further USA debt spending and war efforts are not abating, but the safety net for US citizens is being dismantled.  Lastly, with expulsion of cheap labor, and AI data centers demanding energy and water, food prices will continue to skyrocket.
All of this ends with US stock market going down as profits pullback.   But this time is different.

With all the negative about AI, one thing is clear to me, it will be immense efficiencies to corporations faster than the internet did.   It will be hard to capture this in a GDP number, but make no mistake, companies that can leverage AI to improve their efficiencies will be rewarded in the stock market.  

The problem is, the larger the company, the harder to actually manifest this benefit.  I expect after this drawdown an EXPLOSION of new businesses powered by AI.  People of 1-5 in a company providing the value of 20 people.  These companies can adjust much quicker than large companies.  Large companies will return to outsourcing to many small companies to get the work done.

Eventually this will massively benefit large companies.  I have huge optimism for some companies after this next downturn.  Buying general ETFs wont be a winning strategy.

Keep your ears open, the more negative AI news you hear is a signal that the bubble is popping.