Humanity will ring in a new year in the week ahead.

Here’s hoping 2025’s every bit the horrific, blood-soaked melee that 2024 turned out to be.

I’m kidding. I mean, 2024 was a bloody free-for-all in many parts of the world. But I certainly don’t wish that for 2025. Hope’s not a strategy, though, and I’m not optimistic.

Many of 2024’s worst atrocities admitted of an all-too-familiar tragicomedic paradox: Our species has an incurable penchant for unironically justifying the most godforsaken behavior by reference to the Divine. That’ll continue in perpetuity. Some things never change. That’s one of them.

Another’s our affinity for avarice. (We’re a sin lovin’ lot.) When it comes to risk assets — which for the vast majority of market participants just means equities — that can be fortuitous or not. It’s true that greed’ll get you eventually, but in the meantime, there’s nothing like unbridled rapacity to drive already buoyant stock prices higher still. And the US equities trade is riding pretty high, notwithstanding a few stumbles here and there in December.

As the simple figure above shows, big-cap US equities were on track to be the second-best-performing asset in 2024, behind only gold. The S&P’s 25% annual gain counts as a helluva encore following 2023’s 26% total return.

Can it continue? Yes. Could it all come crashing down? Yes. Does anyone have any better idea than anyone else about which outcome’s more likely? No. As regular readers are apprised, I long ago gave up on the patently ridiculous notion that Wall Street’s would-be soothsayers are capable of making accurate predictions about the future course of equities, let alone calling tops in melt-ups. Maybe they ring bells to usher in a new calendar, but they generally don’t ring them as a warning at market tops. Market timing’s a fool’s errand. You’d have better luck running a mixed-race woman for President of the United States. (Too soon?)

I know just one thing for sure: I don’t know much, a humble concession which, according to the wisest man to ever live, gives me one up on most of humanity. That said — i.e., while conceding that my opinions aren’t any better or worse than anyone else’s — I doubt seriously the notion that investors will decide in 2025 to rotate out of the mega-cap US tech leadership in an orderly fashion in favor of… pick your alternative, small-caps, “cheap” European shares, Chinese equities, etc. The key word’s “orderly.” If the names that comprise a third of US market-cap go out of favor in the new year, my guess is it’ll be an “event,” so to speak, and it won’t be orderly. It’s hard to picture a significant “Magnificent 7” setback unfolding without adverse (I don’t want to say “dire,” necessarily) consequences for the “broad” market, precisely because the “broad” market isn’t very broad.

Frankly, I’m not sure what else you want to own, if not big US tech. Does anyone seriously believe it’s worth it these days to go “picking” like Mike Wolfe for vintage oil cans (i.e., value stocks) in a world where Tesla can add half a trillion in market cap in the space of a month due entirely to a non-fundamental, political catalyst? And that’s to say nothing of Nvidia which, when it gets cookin,’ can add $300 billion in a single session.

Anyway, there’ll be plenty of time for this debate, but no one will likely be too interested in the days ahead. Because just like the last several days, most people will be on extended vacation. For those of you unlucky (i.e., junior) enough to be clocked in during New Year’s week, you can look forward to some not-entirely-trivial US macro releases, starting with pending home sales on Monday. Updates on the two marquee home price gauges (FHFA and Case-Shiller) are due Tuesday. Wednesday everyone will be suffering the aftershocks from the previous night’s non-lethal alcohol poisoning. Thursday brings jobless claims. And Friday ISM manufacturing.