Written on August 31st, 2025.

It is crazy how there are too many good things to invest in.  This is a rare opportunity and you just have to pick and choose from a long list of potential assets.  The difficult multi-year concentration, with only the top 7 mega-cap technology stocks outperforming, has suddenly moved toward strength spreading out far and wide.  A multitude of sectors and assets and regions and cap sizes are all now doing well.

As I recently wrote to clients in a private MarketCycle Update, the market was (and still is) presenting with signs of a near-term period of temporary weakness.  August and September are often weaker months for the economy and stock market, and if not, then October is usually the difficult month.  Perhaps the S&P-500 wants to pull back toward 6200?  That isn’t bad; it is a routine pullback.  We WILL move higher again… to new record highs.  The stock market ALWAYS has to let off steam when it gets a bit too hot (like now), and this is a good thing.  Pullbacks lead to new highs.

So, pullbacks are a normal part of investing in a bull market.  Protection partly comes from our portfolios being diversified in such a way that all assets are in their own bull market and yet they do not all move in unison!  IE, gold is currently in a bull market and stocks are currently in a longer-term bull market, and they move independently of each other. 

One wants to ignore temporary “V” pullbacks… but to absolutely avoid the big bear markets.

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Intermediate term STRENGTH IS FOUND IN:  growth stocks, momentum stocks of all cap sizes, AI, robotics, innovative-technology, Bitcoin, Ethereum-blockchain, financials, industrials, small-cap stocks (which will benefit from the Fed lowering interest rates this Fall and all through 2026, plus they are a great anti-tech position that can go up when tech drops), gold & silver, private credit and developed market stocks (which will benefit as the USDollar drops a bit lower in the near-term, before recovering in the intermediate-term).  Newly increasing strength can be seen in REITS, healthcare (non-pharmaceutical)… and perhaps China (if it can break above its strong, long-term overhead bear market trendline).

REITS, for a host of reasons, look promising; they are not only defensive in nature, but they are severely oversold.  They go up when interest rates are lowered (coming soon, courtesy of Trump) and they go up when higher inflation is created (also coming soon, courtesy of Trump).  They pay tax-advantaged interest.  They have a (price-to-earnings valuation) P/E of 16x in a world where big tech has a P/E of 29x.  REITS and healthcare and financials all have low P/Es of 16x, meaning that they are undervalued.  REITS, healthcare and financials (plus utilities and most technology) suffer almost no impact from President Trump’s tariffs.

Potential NEW BUYS? 

• REITs (Real Estate Investment Trusts) are the #1 recent buy suggestion from BlackRock, centered in residential and global data centers.  [Note that BlackRock is not the same company as BlackStone, and they do behave differently.]  Avoid private-equity REITS; they are ill-liquid and their total collapse, in a few (4???) years, may help to cause the next big super-bear market, just as collapsing fraudulent home mortgages accelerated the Financial Crash of 2008.  Home prices may dramatically drop during the coming super-bear market (and fixed-rate mortgages may be quite low again), with prices recovering fully during the 2030’s.  Because of the strong potential for stagflation in the 2030’s, avoid floating-rate mortgages like the plague.  If you buy your home at the bottom of the next bear market (in 4-ish years?), because of the strong tax incentives, NOBODY should ever pay cash for a house… let the bank buy your house for you whenever interest rates are low.  Perhaps a fixed-rate, no points, 15-year mortgage when both prices and rates are cheap?  After all, this is, by far, the biggest expense of your lifetime and if you need or want to get out, it can act as if it is an ill-liquid investment.  In the meantime, renting is always a good choice, and renting is easy to get out of.
• Healthcare sector (minus pharmaceuticals and biotech) is the #1 recent buy suggestion from Goldman Sachs (and Warren Buffett).  Aging demographics throughout the developed markets helps to backstop this investment.

Near term, large-cap technology may show some weakness over the coming weeks.  And Crypto may show some near-term weakness.  Frankly, the strongest asset that I see right now is gold.  The strongest asset, when the big super-bear market arrives in a few years, will likely be gold and not crypto, despite what the entire world currently believes.

Inflation seems to be holding at the 3% level which I predicted a couple of years ago.  Nobody will remember that.  President Trump artificially pushing rates toward 0% could raise the inflation level toward chronically higher levels, well above 3%.  During the 2030’s, I’ve been predicting killer inflation levels, creating severe stagflation.  INVEST NOW!  Delay your need for instant-gratification (of buying things) by just a few years, then buy them cheap at the bottom of the coming super-bear market!!  If I am correct, then sometime around the year 2030, everything is going to be dirt CHEAP (before prices rise higher than ever during the 2030’s decade).

Right now, we are in the early stages of a very profitable multi-year bubble formation.  Trump wants to artifically move interest rates toward 0%, regardless of the higher inflation that he will cause.  Deregulation (literally “anything goes”) is moving at lightning speed.  Investors are becoming immune to President Trump’s non-stop shenanigans.  There is money sloshing around everywhere you look; tons of it.  Zero rates will create very low margin borrowing levels for investors (and low fixed-rate mortgages).  It will force “savers” away from bonds and into the stock market.  Low rates create great market-boosting stock buy-back conditions for corporations (who want to raise their stock price by buying and then eliminating their own stock shares, making all remaining shares more valuable).  These are all very strong tailwinds that will drive the stock market higher!

A relatively new client recently asked, “Will we be able to see the final top in this bull market just before the bubble pops?”  My strongest investing ability is seeing tops and bottoms forming.  Clients sometimes call to argue with me at the time, but over the past 35 years, I have been continually right about major tops and bottoms… almost always to the exact week and sometimes to the exact day.  And I say this with no humility… I mean “with all humility.”  lol

So, yes, likely near-term weakness, but I am still CRAZY BULLISH!

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MarketCycle Wealth Management is in the business of managing your investment account so that you can be positioned in the strongest assets and so that you can avoid the big downturns that damage investment portfolios.  We try hard to earn our keep.  There is a CONTACT tab at the top of our website.

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MARKET CYCLE  —  HEDGE FUNDS  —  MOMENTUM  —  RELATIVE STRENGTH  — 

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The stock market is showing incredible internal strength.  It was weak and has now strengthened.  Usually when the stock market has been weak but then improves, the economy itself (and home prices and the consumer) then becomes temporarily weaker as stocks rise up off of their bottom.  That is happening now: stronger stocks, weaker economy; the two do not move in tandem.

And then there is Trump.

President Trump naturally spent the weekend threatening high tariffs again and he (temporarily) followed through on Monday with attacks on some of our closest allies (and the Dow stock index is down over 600 points as I type this today).  Frankly, I just wish that he would concentrate on his golf game; he certainly doesn’t understand how tariffs or the economy work.  Volatility, with drawdowns, is the result in the near-term… but it won’t last; the stronger stock market will eventually win.

Trump’s “Big Beautiful Bill” just passed and is now signed into law… and please don’t shoot the messenger:  The rich get lower taxes and more loopholes; the poor get higher taxes and higher food & health care costs and more hurdles to jump.  Hungry poor children lose their school lunch assistance.  Hospitals and clean energy suffer under the new bill.  Trump gets endless money to build prison camps for legal naturalized citizens and illegal migrant workers, not just in the Everglades of Florida, but his stated plan is to build them all across the country.  Social Security itself was weakened by the bill since the tax cut for some seniors comes directly out of the Social Security system’s coffers… but if you work after qualifying for Social Security, and if you earn too much, you are penalized.   Of course, the deficit quickly goes up by another $3.3-Trillion; the United States is now $37-Trillion in DEBT.  

-$37,000,000,000,000

We may get some near term (tariff caused) economic weakness & turbulence plus continued weakness in home prices and consumer spending… with weakness ending in the late Fall of this year?  Below is a weekend quote from President Trump.  I don’t know about you, but I can’t figure it out.  I do know that when push comes to shove (if the stock market suddenly drops), Trump will cave in on tariffs, continuing the TACO trade.  Please remember that tariffs are NOT paid by the foreign country… they are ultimately paid by YOU in the form of higher prices.  And we have to remember that tariffs haven’t really happened yet… July 9th is the deadline… or is it August 1st?  (Quote courtesy of Fortune via Yahoo News):

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Tariffs impact stock sectors differently, with the below sectors on the left being the safest in a “tariff world.”  REITs and financials (banks) and gold & crypto would also be on the left.  MarketCycle’s client accounts are strongly leaning toward the (green) left on this chart (Chart courtesy of Apollo Global):

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Everything that is needed for the stock market to run higher is now in place since corporations no longer need to worry about regulations or any damage to our environment.  And the super-bull market will now broaden out and pick up speed and, in my opinion, it will eventually go parabolic for longer than people would currently believe possible.

We are in the final few years, the strongest years, of a 20-year secular stock bull that started 16.5 years ago.  The current period will mimic 1997 to 2000, where Internet stocks went sky high and generated outstanding profits.

And the bear market that always follows at the end of all 20-year secular bull periods is a real killer.  The last example was the Dot.com Crash in 2000 which was followed by 10 years of weakness (and the crash was copied again in the Financial Crash of 2008).  If I am right, the coming crash at the end of this decade may totally reset both politics and the economy (and maybe the U.S. even just defaults on its debt or we allow the Federal Reserve to “buy” all of our debt and permanently hide it in their non-audited books?)… a chance to start over, including a new gold backed digital currency since the U.S. owns most of the world’s physical gold; a chance to do things differently and better.  Crisis leads to opportunity.

During the next few years, it will be innovative technology and particularly AI & robotics and crypto & blockchain (and inflation assets) that will lead the way to great profits.  By 2028 the stock market may be moving parabolically higher and this might even cause people to (dangerously) take out second mortgages on their homes and to borrow money from brokerage houses in order to toss the money at the stock market.

There will be some bumps along the road, perhaps a temporary larger pullback in 2027, but investors just need to hang on until the very end.  My job is to spot the end times and then to switch gears AT THE RIGHT TIME in order to profit from the destined big bear market that will then be due.

Technology is fairly immune to tariffs and interest rates and inflation.  Technology has been leading the market higher, BUT it is still in the early stages of its ascent.  Innovative technology, just now at the middle of its “S” curve cycle, is likely to be a particularly strong asset during the coming few years.  AI and robotics technology are both extremely important, as are the smaller utilities that run AI data centers and the big banks and private credit companies that fund the new technology startups.  Effective July 1st of this year, the market is suddenly broadening out while the USDollar is less strong, which means that we now have an opportunity to successfully buy innovative & disruptive technology in all cap-sizes and from all countries, including Japan and Asia.

Interestingly and hard to believe (and fact checked) Amazon literally just created its millionth robot (imagine, Amazon now has 1,000,000 factory robots!).  Meta has just hired a giant “who’s who” list of AI builders.  It’s happening, so one might want to buy into the stock market and just hold on!  (Chart courtesy of TechCrunch)

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I personally believe that the need to create an intelligence is built into our DNA and, as a sort of “manifest destiny,” it cannot be stopped.  So, going forward the BIG story will be artificial intelligence (and robotics).  The rush into AI will likely push the stock market to unbelievable heights over the next few years.  AI & robotics will be a key factor during the remainder of our lives (and beyond), no matter how the stock market reacts to the AI & robotics trade in later years.  I now use AI every day of my life. 

This important chart below shows the potential of what may be THE great technology super-bull that is still in its early stages.  My bet is that the “AI trade” goes parabolic for a profitable and prolonged period.  Going forward, every time that someone on Wall Street declares that we are in an AI technology bubble and that we should “watch out,” just laugh and ignore them… they have no clue as to how big a bubble can become.  In my opinion, this AI bull will be big.

The current wave may prove to be the big one… we’d currently be just about where the question mark is.  (Chart courtesy of Benedict Evans, a technology expert based out of London):

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In general, MarketCycle’s client accounts hold the following positions (there may be some accounts that are too small to hold all positions and custodial trusts for minors and corporate accounts cannot hold any “esoteric” positions):

1. Gold bullion
2. Private credit funding for technology companies (half floating-rate & half fixed-rate, 100% secured, paying 7% interest)
3. Bitcoin & MicroStrategy (our bitcoin ETF pays 28% interest without cutting into profit gains and MicroStrategy is cornering the market in Bitcoin)
4. Managed futures (long-short global interest rates, global currencies and commodities, but does not hold stocks… a great diversifier and a big help during inflationary periods)
5. Developed market growth stocks (growth = strong)
6. Small-cap momentum (momentum = trending strong)
7. Mid-cap momentum (cap = size of the corporation)
8. Large-cap momentum
9. U.S. Technology sector
10. Global innovative technology
11. Global artificial intelligence
12. Global robotics
13. U.S. large-cap banks (they fund new IPOs and mergers)
14. U.S. small-cap to mid-cap utilities (they supply energy to AI data centers)

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That’s it, thanks for reading!

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MarketCycle Wealth Management, for a low fee, manages brokerage accounts for the general public… in the United States and globally.  There is a contact tab at the top of our main website.  We strive to earn our keep.

Our REPORT site can be reached via the connecting link on our website.

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MARKET CYCLE  —  TREND FOLLOWING  —  ROTATION  —  RELATIVE STRENGTH  —  DUAL MOMENTUM  — HEDGE FUNDS

Clients may take it for granted that I am bullish during a bull market.  I mean, what else would I be?  I sometimes quote my (famous) investor acquaintance, Ed Seykota, by saying:  “It is not logical to be bearish in a bull market.”

Well, most investors are still illogically bearish, and this includes professionals and major institutions and even the paid analysts that so many investors depend on.

When one “shorts” the market, they are betting, with their hard-earned money, that the market is going to fall sharply.  Right now, we have the biggest hedge fund ETF short position in the history of the universe.  This makes me very bullish because most people are always wrong… when sentiment is too bearish, it is a very bullish signal.

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And we currently have the most money, in the history of the universe, still sitting on the sidelines, waiting & wanting to move into the markets but too afraid to make the move, although it will.  This makes me long term bullish since much of the $7,250,000,000,000 will slowly enter the market over the next few years.

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Currently, most investors are still selling into any rallies (see the red area at the far-right bottom).  This makes me very bullish.

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But when the stock market drops 18% and then (“V” shaped) recovers as quickly as it just did, then the market tends to just keep moving higher (see the green vertical lines as compared to the S&P-500 over the past 55 years).  This makes me very bullish longer term.

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Currently, there are 34% more home sellers in the United States than there are home buyers.  This will lower home prices, which will lower inflation (because 55% of inflation is being caused by high home prices), which will allow the Federal Reserve to finally be able to lower interest rates, which will be extremely stimulative for the entire stock market, including the very undervalued small-cap stocks.  Lower yields would also offer lower rates on new home mortgages, so that stimulation would put somewhat of a floor under home price losses with, perhaps, strengthening home prices showing up again sometime in 2026.

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SUMMARY:  I’m watching provisions in Trump’s “Big Beautiful Bill” and how it affects U.S. investments by U.S. citizens and by overseas investors; I’ve probably read more about the bill than have most members of Congress.  There is certain to be a battle getting approval for the bill because Trump’s program would increase the U.S. deficit by a whopping $5.8-Trillion (which defeats any legitimate purpose of DOGE… which is now to continue under the leadership of Peter Thiel).

The economy (and housing) is starting to weaken.  Stocks lead the economy… stocks were weak, but they are steadily getting stronger.  And now it is the lagging economy’s turn to weaken as stocks now get stronger.  It is likely that six months from now, in the late Fall, both stocks and the economy will be strong at the same time and remain strong for an extended period.

So, I remain bullish.  I am still bullish on U.S. stocks but have also added Developed Market stocks to our mix (such as Euro area, Northern Europe, UK and Japan).  The USDollar, despite its recent weakness, is still within the walls of its bullish trend channel, but I still also hold gold bullion which is “anti-dollar.”  Artificial intelligence and innovative-disruption stocks will lead the way higher over the next few years.  Big banks will gradually be funding new (IPO) Initial Public Offerings of innovative new baby companies, and both will profit.  Growth stocks will continue to beat value stocks over the next few years, until they fall out of grace in the 2030’s.  Of course, we will continue to get zig-zagging (often Trump caused) volatility and occasional downdrafts.

And we will eventually get the big bear market that is always promised at the end of ALL secular bull market cycles (as in the technology based Dot.com bust in 2000), and that will offer additional profits because it will finally be the correct time to “short” the market.  Again, a “short” is a bet that markets will drop.  But at that “end-times” event, we will be the rare short holder and most of the market participants will be euphorically bullish and buying on every dip, as the market drops (and drops and drops) over a, perhaps, two year period.  But that is not now and it is not soon.

Although everyone else is highly negative, I’m so (patiently) bullish that I’m almost giddy!

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Thanks for reading!

MarketCycle Wealth Management is in the business of watching over the investments in your brokerage account.  The entire process is easy.  We try hard to earn our keep. 

The REPORT website can be visited via the connecting link on the main website.

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MARKET CYCLE  —  TREND FOLLOWING  —  MOMENTUM  —  RELATIVE STRENGTH  —  HEDGE FUNDs

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My last few blogs have been long, so as the pendulum swings, this one will be somewhat shorter.

We are in a secular stock BULL market that started in the Spring of 2009.  Historically, they last for around 20 years.  Secular stock market cycles are long cycles that determine the prolonged strength or the weakness of the markets.  When we are in a secular stock BULL market, the bullish periods will be exceptionally strong and the bearish periods will be less significant.  This current secular BULL cycle likely ends in the Fall of 2028 or the Spring of 2029… I’ll know when we get closer to the end.

We are also in a concurrent and overlapping cyclical stock BULL market that also likely runs until the Fall of 2028 or the Spring of 2029.  Cyclical stock BULL markets run for around 6 years and this one started in the Fall of 2022, at the bottom of the 2022 bear market.

20-year secular bull cycles usually contain three 6-year cyclical bull market cycles plus two bear markets.

The two cycles, secular and cyclical, may end together in late 2028 and both would move in unison into a combined secular AND cyclical bear market which, if history proves to repeat yet again, the combined bearishness could end in a monster bear market crash.  Perhaps the worst in history.

Crashes can be more rapidly profitable than can be any bull market.  I made most of my personal money by shorting the entirety of the crashes of 2000 and 2008.

But right now, a super-strong and unstoppable bull market continues higher; I expect the final couple of years of this bull market to be parabolically strong with a market emphasis on artificial intelligence, robotics and innovative technology… sort of a super-copycat of the late 1990’s Dot.com technology bubble.  If I am correct, people will be obtaining margin loans and mortgaging their house to get hold of extra money to invest in the stock market; a dangerous pursuit because these same people will get themselves trapped in the eventual bear market.

What will cause the next giant bear market?  Massive U.S. government debt (Trump and the Republican Congress members are well into the process of passing a gigantic debt increase, mostly for tax savings for the top 5% and for military weapons, via Trump’s “Big Beautiful Bill.”  This follows Biden’s out-of-control spending habits).

A headline from today’s CNBC financial website:

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So, how will we fund our debt?  It is normally done via the U.S. selling Treasury bonds.  But now, nobody wants to own U.S. Treasuries.  I am writing this article on May 21st and today’s Treasury Auction was a complete dud and the stock market, that was flat, dropped 800 points on the Dow within minutes of the auction.  Treasury bonds are essentially loans given to the U.S. government.  Right now, nobody wants to loan the U.S. government any money.  Most of MarketCycle’s client accounts own NO Treasuries.  So, to fund our rapidly growing debt/deficit, the U.S. will “print money” and buy its own debt via a “not talked about” Quantitative Easing process… which will work… until it doesn’t.

This process of “printing money” to buy our own debt, coupled with Trump’s tariffs (which are entirely paid for by U.S. corporations and U.S. consumers) will create high inflation.  High inflation makes the cost of servicing the debt rise and rise and rise to eventual unpayable levels.  Specifically, this is what will cause the coming debt-ridden bear market.  Unpayable debt and inflation that would be impossible to stop without the Federal Reserve raising interest rates beyond 20%.  Yes, that is what I believe.  I saw rates go to 19% in 1981.  My first home mortgage was at 16%… and I was too dumb (and unstoppable) to understand that 16% is problematic.

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Right now things are good in the markets; where should we invest?  Below is what the market itself is telling us to hold (and this is primarily where MarketCycle’s client accounts are positioned, although I am not suggesting that you should do the same):  innovative technology, mega-cap technology, financials (large banks), consumer services and small to mid-cap utilities.  Momentum stock ETFs would hold primarily those sectors just mentioned, and particular momentum ETFs are often winners (but some are poorly designed).  We should also add “crypto” into the mix.  REITs may not do as well as during past bull markets.  Industrials should (eventually) get stronger again as the new administration in the White House backs further away from their destructive tariffs.  At the end of this final super-bull market, energy will also get strong, just as it did during the Dot.com bubble bull market.

Invest in assets that generate outsized profits (Chart courtesy of Datatrek):

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Artificial intelligence, which offers humans astounding benefits along with accompanying terrifying consequences, will soon be the big (big!) money maker and its profit potential will continue to be under-estimated.  My opinion is that the creation of artificial intelligence is unstoppable… sort of a modern “manifest destiny.”  (Chart courtesy of Morgan Stanley.)

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Certain “momentum” ETFs are often a good method for catching the best assets during the best times, although they have to be watched carefully during downturns.  MarketCycle always holds a minimum of 25% momentum stocks in our portfolios.  (Chart courtesy of Alpha Architect.):

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That’s it… thanks for reading!

MarketCycle Wealth Management is in the business of managing your money through the market cycles.  There is a contact tab on our website, but I can be reached via:

StephenAust@MarketCycleWealthManagement.com

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MARKET CYCLE  — DUAL MOMENTUM  — TREND FOLLOWING  —  RELATIVE STRENGTH  — HEDGE FUNDS