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Feb 10

This time is NOT different.

A thread 🧵

2/ The National Bureau of Economic Research has 3 specific conditions to define an asset bubble:

- The asset needs to rise by >100% over a 2-year period.

- It needs to outperform the broader market by at least 100% over that same period.

- It needs to deliver a 5-year return of >50%.

3/ Railways in the 1840s, Dow Jones in 1920s, and Japan's stock market in 1980s, all of these melt-ups were officially bubbles.

And in each case the bubble eventually burst, triggering economic downturns, including the Great Depression.

Today, the media consensus is that we are in a tech bubble.

Read 25 tweets

Bravos Research

@bravosresearch

Feb 6

Japan’s $10 TRILLION debt meltdown is about to hit the US

Buckle up.

A thread 🧵

2/ For years, Japan was seen as the epicenter of global sovereign debt risk, but this has now changed.

In just the past few weeks, we’ve seen a major shift, with currency and debt risk moving from Japan to the US.

3/ This is showing up clearly in the US dollar index breaking a structural uptrend that’s been intact since 2011.

The playbook we’ve been outlining for months is now playing out.

And we’re witnessing the most coordinated policy shift since the Plaza Accord of 1985.

Read 26 tweets

Bravos Research

@bravosresearch

Jan 30

The US stock market is near all-time highs in dollar terms

But is down 45% when measured in gold terms

What does this mean for the economy and financial markets?

A thread 🧵

2/ The shifts unfolding today in the global monetary system, the geopolitical order, and global trade have major implications for the markets.

Yet most people are completely misreading what is truly happening in the financial markets.

3/ This chart shows the US stock market against the US economic policy uncertainty index.

In early 2025, the US stock market and US economic uncertainty index mostly moved together.

But over the past year, we’ve seen a clear divergence slowly build between these 2 lines.

Read 23 tweets

Bravos Research

@bravosresearch

Jan 26

Donald Trump wants the US economy to keep outperforming

But he also wants a weaker dollar to support re-industrialization

This would require breaking a major relationship that’s existed since the 1960s

A thread 🧵

2/ The US government has a problem.

For decades, interests of the government and the Federal Reserve were aligned.

But these interests are now diverging and this could lead to the single greatest shift in US financial history.

3/ The US economic strategy of the last 30-years can be captured in 1 chart.

This chart shows the Trade Balance versus the Capital Account Balance.

The trade balance shows whether the US imports or exports more goods.

The capital account shows whether foreigners buy US assets or the US buys foreign ones.

Read 25 tweets

Bravos Research

@bravosresearch

Jan 15

The US bond market is beginning to break

Long-term yields are still rising

While short-term yields are falling

History shows this is a MAJOR warning signal

A thread 🧵

2/ 1 of the most fundamental relationships in financial markets is breaking right now.

In the last 1-year, the 30-year Treasury yield has been rising while the 3-month Treasury yield has been falling.

This divergence signals that the monetary policy is breaking.

3/ The 3-month yield is effectively set by the US Federal Reserve.

And the 30-year bond yield is primarily influenced by private investors or foreign governments.

These private investors are often called bond vigilantes.

History shows that their actions can work against what the US central bank is trying to achieve.

Read 24 tweets

Bravos Research

@bravosresearch

Jan 9

Truck sales are collapsing, but stocks are hitting record highs

The last 3 times this happened were in 2000, 2008, & 2020

All of them saw an economic recession and a major market crash

Is this time different?

A thread 🧵

2/ This chart shows the aggregate economy index.

When we mark the exact peaks and troughs, they line up precisely with the official start and end dates of recessions.

3/ On average, the stock market peaks several months before an economic recession begins.

By the time most people feel economic stress, the stock market is usually already far below its highs.

This leads many to think that stocks are perfect forward indicators of the economy.

Read 23 tweets

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