‘Epic’ Market Reversal Can Persist, Goldman Says
It was easy to miss, buried as it was under an avalanche of domestic political headlines, but investors just witnessed history.
As documented here on at least four occasions over the past several days, US small-caps outperformed big-caps and mega-cap tech by the most in nearly half a century in recent sessions.
That showing would've garnered above-the-fold coverage in the financial pages were it not for what I (aptly) described as "the most bizarre, extraordinary week for American politics in
Ah Goldman, always forecasting the continuation of whatever is happening.
Just kidding, I think GS is okay.
I think something like this: 2Q earnings okay, in September Fed cuts into what still seems like a strong-ish economy, possible November Trump bump, then usual year-end rally. Market broadens, whether rising-tide-all-boats or overheated-and/or-profitless-AI-backlash or both. In 2025, ham-handed and overtly inflationary policies precipitate the recession, made longer and deeper by Republican Calvinistic beggar-the-needy ethos, and various geopolitical risks manifest. During all this, yield curve steepens before flattening. Just a guess but you’ve got to bet on something.