Thread by @financefelix

5 crash indicators just lit up red.

The same ones that warned us before 1987, 2000, 2008, and 2020.

But unlike those crashes, today's rally has something different: real profits and massive government spending.

Here's why 2025 could keep running:

Think of crash indicators as your car's warning lights before a breakdown.

They flag when markets get too hot or the economy wobbles.

There are 5 big ones to watch:

1) Schiller PE
2) Buffett Indicator
3) Unemployment rate
4) Inflation rate
5) GDP growth

1) The Schiller PE measures stock prices against 10 years of average earnings.

When it's above 25-30, stocks are getting pricey.

Right now we're at 38 - higher than 2008, 2020, even 2000.

It's like paying $38 for just $1 of profit.

2) The Buffett Indicator divides total stock market value by US GDP.

When it's above 150%, it warns of a bubble forming.

We're sitting at 211% right now.

For comparison, the dot-com bubble only peaked at 150%.

3) Unemployment just ticked up to 4.2%.

When low unemployment starts creeping higher, it's an early recession signal.

Fewer jobs means less spending, which leads to weaker stocks.

That's how the dominoes start falling.

4) Inflation is at 2.7% right now.

When it goes above 2-3%, it pressures the Fed to raise rates and slow growth.

GDP growth forecast also dropped to 2.5% next quarter.

Anything below 2% signals real weakness.

5) GDP growth forecast also dropped to 2.5% next quarter.

Anything below 2% signals real weakness.

Here's how these indicators warned us before past crashes.

The dot-com bust was brutal.

NASDAQ dropped 78% over two years.

Schiller PE hit 44 and Buffett was 150%.

Companies had no real profits, just dreams.

In 2008, the S&P dropped 57%.

Schiller sat at 27, Buffett at 120%.

Housing drove everything up.

When inflation hit 5%, the Fed had to raise rates.

That was the domino that toppled it all.

COVID was different.

The S&P fell 34% in 33 days - about 1% every single day.

Schiller was 32, Buffett at 140%.

But lockdowns caused the crash, not market cycles.

A man-made collapse.

So why might 2025 be different?

Unlike dot-com's profitless startups, the Magnificent Seven are cash machines.

Microsoft made $76 billion last quarter. Azure up 39% on AI demand.

Plus policy rocket fuel.

Trump's tax cuts, corporate breaks, deregulation.

A $3 trillion deficit is spending juice for the economy.

Q2 beat at 3% growth.

Hard to have a recession with deficits this big.

But valuations are nuts.

Schiller at 38, Buffett at 207%.

Higher than every previous crash.

If AI hype fades or earnings miss, we hit the ground hard.

Markets work in patterns.

Once you understand them, fear goes away.

You know what to buy, sell, dump.

That's the difference between guessing and knowing.

Listen:

There's a simple 3-step system they use to trade confidently (despite having zero experience).

This is the same system Wall Street uses to spot patterns & opportunities.

I'm holding a masterclass walking through this exact system.

RT & comment "FREEDOM" & I'll send you the link.

More money's been lost waiting for crashes than in actual crashes.

Peter Lynch said that.

Markets don't crash from nowhere.

These indicators give you a dashboard.

They flashed red before '87, 2000, 2008, 2020.

They're blinking now, but AI profits and policy are keeping the party alive.

The smart play?

Don't panic. Don't run for hills.

Watch the indicators, but remember: bubbles can run longer than anyone expects.

The key is riding the wave, not fighting it.

Move around sectors as patterns shift.

That's real risk management.

Don't just sit in one thing grabbing headlines.

Follow the patterns, not the hype.

Any skill can be learned.

Why learn from someone slightly better when you can learn from someone who actually knows what they're doing?

That's always been my approach.

Don't get too comfy.

Never assume tomorrow's great.

But don't panic at every warning either.

Watch metrics, understand patterns, trade with market rhythm.

That's how you win.