This is How the Economy Collapses.

Over the course of the last three years, the U.S. stock market has jumped by 100%, effectively doubling in price. It took over 20 years for the stock market to double in size from 1965 to 1985, and it took 17 years for the stock market to double between 1997 and 2014. This is one of the strongest stock market rallies in U.S. history. Yet at the same time, 64% of Americans are living paycheck to paycheck, U.S. unemployment has been on the rise for the last two years, and GDP growth has slowed to practically 0% in 2025. The economic system is dysfunctioning, and as we're going to see, things are going to get a lot worse before they get better. Real quick, we're launching our biggest product ever on November 18th for Black Friday, a trading curriculum that is entirely designed to get you to become a hyper-profitable swing trader. This is the framework that we use to beat the market on a consistent basis. Those who attend to this event live will have access to the biggest offer that we'll ever do on this product. During the live stream, I'll also be showing you step-by-step our entire framework for generating market-beating returns in trading. I'll be joined by our lead trader, who's among the top 0.1% highest performing traders in the world. You can register to the event completely for free, and anyone who attends will also be getting one extra gift completely for free. So if you want it, click the link down below to register to the event, and I'll see you on November 18th. In order to understand exactly what is happening, we need to take a look at this chart. It shows us the S&P 500 index that has been soaring higher over the last three years against a key vital economic indicator that has completely flatlined. This is housing starts in the U.S., so it's the number of home constructions being started any given month, which shows us the level of activity in one of the most important sectors of the economy, housing. As you can see, housing starts peaked right here in March of 2022. This is the very month where the United States Central Bank began to raise their interest rate from 0% all the way up to 5%. These high rates caused a complete flatline of the housing market. This is a much more accurate representation of what has been happening underneath the surface over the last three years. High interest rates across the economy have slowed the job market down significantly as we've seen from a rising unemployment rate over the last two years. Borrowing costs have been elevated for small businesses, impacting their ability to grow and high mortgage rates have created a housing affordability crisis for the consumer, completely crushing consumer confidence and spending. The truth is, high interest rates have weakened the fabric of the economy considerably over the course of the last three years. The Federal Reserve sees and understands this. The chair of the Federal Reserve, Jerome Powell, has recently stated that the job market and weak growth is becoming more and more of a risk, which has recently pushed them to stop QT, which was the removal of liquidity from the financial system, and cut interest rates in order to stimulate economic growth once again. Now, so far, there is nothing inherently wrong with this. This is how the business cycle works. When the economy gets hot, the Federal Reserve raises interest rates to tighten liquidity in the financial system, which cools the economy down. When the economy cools down, the Federal Reserve lowers interest rates to loosen liquidity in the financial system, which heats the economy back up. This is how things usually play out. But there is something that is deeply broken about how things are playing out today. Firstly, the Fed has been cutting interest rates since 2024. But despite that, we've not seen any positive effect on economic growth. As we mentioned earlier, GDP growth in 2025 has essentially been non-existent. The job market has slowed to its weakest point since the pandemic. Consumer confidence is still incredibly weak at around the same levels it was in the Great Financial Crisis. And finally, as we mentioned earlier, activity in the housing market is still completely dead. So it seems that the Federal Reserve's rate cuts so far are nowhere enough to revive real economic growth, and they'll likely need to cut interest rates much more before they see some real improvement in economic activity. The only problem is potentially needing to take their interest rate back down to where it was pre-pandemic. But the consequences of doing this could be disastrous, because what we are seeing is that the Federal Reserve's rate cuts are having an outsized positive impact on how investors in financial markets are allocating to the stock market and how technology companies are spending. You see, there's currently approximately $7.5 trillion stored in something called money market funds. This is essentially cash that has been stored away and that is generating a return on investment through an interest rate. The amount of money stored in these funds has skyrocketed in recent years as a result of the high interest rate environment that we've been in. But every time that the Federal Reserve cuts interest rates, it essentially pushes investors away from cash and into other financial assets. And what better place to allocate your capital than the stock market that is riding the wave of AI? Just the largest seven companies in the S&P 500 index currently have an estimated cash pile of $500 billion. And we know that over the last three years, they've been ramping up their capital expenditures in a massive way. Now, part of this is just excitement around AI, but part of it is also a result of the Federal Reserve lowering the return on investment that these companies can get from holding cash. So on the one hand, you have the real economy that is struggling from high interest rates. This is the part of the economy that 90% of the U.S. workforce is tied to, and that is in deep need of monetary policy stimulus from the central bank. On the other, you have a very small fraction of the economy tied to technology and AI that is getting hot and speculative, which could be at the risk of turning into a full-fledged bubble. This is a setup that unfortunately we do not think will end well. The U.S. central bank will be forced to continue lowering interest rates and providing liquidity in order to stimulate the real economy. But as they do so, they'll also be stimulating the stock market and potentially fueling the AI bubble. This will continue until the bubble gets extreme and they are forced to remove liquidity in order to control it. As we know from history, financial asset bubbles popping can lead to pretty severe economic pain. We've been riding AI stocks over the last few months, and it seems we'll be pushed to continue doing so given the current macroeconomic context. If you want to learn how to turn information like this into actual profitable trading, don't forget to register to our event for November 18th down below. I look forward to seeing you there. Thank you for watching.