In the wake of the pandemic bubble, Wall Street and Silicon Valley created the AI bubble, now teetering on the brink of collapse. An intriguing theory suggests the call/put ratio might forecast market turns, and attention is drawn to the semiconductor market’s recent turmoil, especially its peak in July.
Notably, the sharp drop in the National Association of Homebuilders (NAHB) Index indicates declining consumer confidence, a classic lag effect. While the housing market currently captivates spectators, the broader population remains largely untouched by the tumultuous events of 2022 and 2023.
Furthermore, the OECD’s tracking of the US M3 money supply reveals a concerning trend—contracting since July 2022 and now 3.3% lower than a year ago. Similar patterns in 1993 and 1995, when the M3 never turned negative, were not accompanied by inflation concerns, raising alarm bells about the current economic climate. As the AI bubble faces its final stage, signs point to an impending storm on the economic horizon.
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When the pandemic bubble imploded, Wall Street and Silicon Valley invented the AI bubble.
Which is approaching its final stage of implosion. pic.twitter.com/yB2iYL5oyz
— Mac10 (@SuburbanDrone) December 11, 2023
I had a theory that the call/put ratio could predict market turns.
I think it can. pic.twitter.com/kcwvaxp0XP
— Mac10 (@SuburbanDrone) December 11, 2023
"I hope this is not this again" pic.twitter.com/PVf1PLUyc6
— Mac10 (@SuburbanDrone) December 11, 2023
I am looking at this semiconductor overthrow.
Because that was the high in July. pic.twitter.com/LbW6F1Mnla
— Mac10 (@SuburbanDrone) December 11, 2023
2/4
They watched from the sidelines.But another year brings more people into this housing debacle. That horrible feeling, logging into the MLS and seeing no new listings, every day.
Even worse, having your hand forced and swapping a 3% mortgage for 7% because the school stunk.
— Jeff Weniger (@JeffWeniger) December 7, 2023
4/4
Now, a new cohort, the Class of 2024, will join them on the list of the frustrated. Before, maybe they responded positively to the Consumer Confidence index. But once they start spending their evenings frustratingly scrolling Redfin, any confidence they had will be gone.— Jeff Weniger (@JeffWeniger) December 7, 2023
The OECD still tabulates US M3 money supply. It has been in contraction since July 2022 and is 3.3% lower than it was a year ago. The two prior lows, whereby this never went negative, were in 1993 and 1995. Neither of those periods are associated with inflation frights. pic.twitter.com/0PnJxQTQzP
— Jeff Weniger (@JeffWeniger) December 11, 2023
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