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Bravos Research Profile picture
@bravosresearch
Aug 22, 2024 • 14 tweets • 4 min read • Read on X
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US gov. debt market collapse has started

This has MASSIVE implications for the economy

A thread 🧵 Image
2/ US government bonds have broken below a 40-year uptrend

After experiencing one of the most aggressive bear market since the 1980s Image
3/ Treasury bonds, typically 40% of an investor's portfolio, have led to significant losses because of their sharp decline
4/ Since March 2020, gold has outperformed Treasury bonds by +100% amid surging government spending

Government expenditures have risen from $3.4 trillion to almost $4 trillion in just 2 years Image
5/ Constantly rising government spending, financed by issuing more Treasury bonds, is a BIG problem

This has caused bond prices to drop significantly
6/ Treasury bond issuance in 2024 is expected to hit $1.9 trillion

This level is higher than even the peak of the 2008 Financial Crisis levels Image
7/ Although we expect a bounce in bonds, our long-term outlook on it is bearish

You can find our latest Watchlist and all our Trade Setups with at:

bit.ly/GameofTrades
8/ A key factors that’s driving this long-term breakdown in Treasury bonds is the decline in labor force participation rate

This metric has shown a strong negative correlation to US government debt since 1999 Image
9/ The decreasing labor force participation + increasing government debt indicate economic strain

This is because of more people retiring and fewer people working

The combination has required the government to increase its spending Image
10/ With the aging US population and more people retiring

Labor force participation is likely to decline further

This would increase government debt even more, unless spending changes Image
11/ That’s why Gold has seen a lot of bullishness

Surging +35% since Oct 2023

Our members have already secured a 22% gain on $GDX when we booked partial profits on 23rd May

And continue to hold the rest for more upside Image
12/ You can check all our 2024 closed trades for FREE on our landing page

It's been a solid year for our members with an average win of 16.92% and average loss of just 3.93% Image
13/ Join us now for just $1.45/day to access our real-time Trade Alerts with full details:

- Long/Short position
- Allocation weight
- Entry
- Stop-loss
- Reasoning for the trade

bit.ly/GameofTrades
14/ Thanks for reading!

If you enjoyed this thread, please ❤️ and 🔁 the first tweet below

And follow @gameoftrades_ for more market insights, finance and investment strategies

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More from @bravosresearch

Bravos Research Profile picture
May 18
The US stock market is now more expensive than it was in 1929, 1965, and 2000.

Each of these coincided with a major market top that led to over a 35% drawdown.

But each of them were triggered by one key factor…

A thread 🧵 Image
2/ 1929, 1965, and 2000 marked some of the highest stock market valuations in modern history.

And today the stock market is at even higher levels than any of those periods.

Now, valuations are not a timing tool.

But historically, extreme valuations have done a surprisingly good job at signaling major market peaks.Image
3/ In 1929, the valuation peak was followed by an 80% market collapse during the Great Depression.

In the 1960s, it led into a decade of stagnation as stock market valuations were slowly repriced.

And in 2000, the dot-com bubble burst and wiped out trillions of dollars in market value.Image
Read 24 tweets
Bravos Research Profile picture
May 13
The probability of an economic recession has just hit 50%

This has preceded every single downturn since 1960

Buckle up…

A thread 🧵 Image
2/ This line represents the probability of the Fed raising their interest rates in 2026 based on bond market expectations.

And the other line represents the probability of rate cuts.

Rate hikes are now becoming the highest probability scenario for the rest of 2026. Image
3/ And if these expectations are right, they're going to have massive consequences for the US economy.

Because right as this is happening, economists are increasingly warning about a potential recession. Image
Read 22 tweets
Bravos Research Profile picture
May 8
Hyperscalers are set to spend $700 billion on AI infrastructure this year.

Investors are already comparing today’s AI boom to the 2001 internet bubble.

But the underlying economy may be telling a completely different story…

A thread 🧵 Image
2/ Microsoft, Amazon, Meta, Alphabet, and Oracle are expected to spend $700 billion this year alone on AI infrastructure.

That's more than the entire GDP of developed nations like Sweden or Singapore. Image
3/ This spending spree has probably been the single biggest force driving the stock market over the past few years.

Investors see this massive spending and assume that it will translate into significant future growth.

And since these companies make up a large portion of the market, their spending has the power to lift the entire index with them.Image
Read 20 tweets
Bravos Research Profile picture
May 6
Major market drawdowns have proven to be exceptional buying opportunities

But the forces behind this buy-the-dip psychology are now reversing…

A thread 🧵 Image
2/ The stock market has often recovered quickly from major macro shocks, including:

- 6 months after the pandemic
- 12 months following 50-year high inflation
- 3 months after a trade war disruption

Recently, the Iran war has disrupted global oil supply, but the market recovered to ATHs within just a few weeks.Image
3/ We've seen a similar pattern play out multiple times over the last 15 years.

Every single correction was immediately followed by a market rally.

But today, the forces behind this buy-the-dip mindset are reversing. Image
Read 22 tweets
Bravos Research Profile picture
Apr 30
Oil shocks have systematically coincided with a rising unemployment rate

This happened in the 1970s, 1990, 2001, and even 2008

But there is one big difference this time around…

A thread 🧵 Image
2/ The US stock market has just made its fastest 10% jump since May 2025.

We’ve only seen similar moves 4 other times since 2009: April 2020, January 2019, October 2011, and March 2009.

And each of these rallies were followed by more upside on the stock market. Image
3/ On the other hand, the University of Michigan Consumer Confidence Survey just hit levels weaker than during the heart of the financial crisis.

This is a survey that tells us how people feel about the future of their own financial situation and the economy.

So the war in Iran is certainly not making everyday people more optimistic about the economy, unlike what investors seem to be pricing into the stock market.Image
Read 26 tweets
Bravos Research Profile picture
Apr 28
The US stock market just hit record highs despite a major oil shock

Historically, such oil shocks have triggered economic recessions

Is this time different?

A thread 🧵 Image
2/ After some talks of a ceasefire, oil prices went down and stocks reached new ATHs.

But oil is still 40% up from its pre-war levels.

Shouldn't the economic drag of a 40% oil jump prevent the stock market from hitting record highs? Image
3/ What many people miss is that this has less to do with the S&P 500 itself and more to do with the currency it’s priced in - the US dollar.

And this is leading us straight into what we think is one of the biggest investment opportunities in the last 10-years. Image
Read 24 tweets

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