Economic Outlook 2025

Sports gambling, after being federally legalized in 2018, has become a legitimized industry worth almost $250 billion. Its shameless marketing and addicting game models have suckered in countless of degenerate gamblers who aim to win big. The more risk averse individuals abstain from betting on sports with the justification that the House always wins. Ironically these same individuals comfortably apportion large amounts of their hard-earned money in institutionalized markets with the same prejudicial environment. We all know the game of Wall Street is fixed. The same players always win, even when they lose. Yet, we all must play this game, because it is not financially prudent to sit on the sidelines in an inflationary contest.

The controlled economies of the world rig the financial markets to outpace the degradation of currency. The price appreciation of assets relative to devaluation of purchasing power is an intentional feature of our monetary system. The overvaluation of stocks and real estate is mandatory for governments reliant on favorable consumer sentiment. An impoverished constituent is far less likely to vote for incumbent politicians so the economy must always grow. Luckily for the economically illiterate bureaucrat, fiscal responsibility is entirely discretionary when government debt can artificially pump markets higher. Inflation is disproportionately distributed in our global economy, so the negative effects of money printing are exported to poor countries while simultaneously pulling that excess liquidity into U.S. financial markets. Modern colonization is performed with bank loans and monetary policy instead of guns and ammo.

Methods of valuation only work when markets are competitive and free of influence. So basically, they are worthless in determining a fair price for stocks and other assets. Today’s markets are driven by dubious accounting, taxpayer backed financial instruments, and pure speculation. The average investor more closely resembles the sports gambler than Warren Buffet. Most people are quite passive in their wealth building strategy, subscribing to the traditional 60/40 portfolio. This approach is considered cautious and wise compared to picking individual stocks in unconventional industries. On the contrary, the customary 401K or pension plan is hilariously far from diversified as they primarily allot your capital in high-risk technology stocks and low yielding government debt.

The major stock indices are not equally weighted as a handful of companies dominate the market capitalization by sheer size and influence. That’s why bad news for Nvidia can pull down the entire market. Overvalued U.S. tech companies have more influence on your retirement than you might be comfortable with. The incredible cost of existing government debt has been enough to downgrade the credit rating of the Treasury Bills making up a large portion of your pension. One might attribute the perilous nature of passive investing to… oh I don’t know… gambling.

The dangers of market volatility drastically increase as economic conditions change. I believe 2025 is the culmination of many driving factors. The resurgence of inflation fears, the insolvency of banks, debts maturing at higher rates, liquidity crises, and struggling consumers all contribute to a demoralized global economy on the cusp of catastrophe. Things can look pretty bleak, but there is opportunity in every calamity. Trends dictate long term financial success, and it is considered to fight the inevitable. My personal outlook for financial markets originates from these trends in culture, business, geopolitics and my own bias of course. Take everything with a grain of salt.

Labor Market

The job market can only be understood from the ground. Government labor statistics are either embellished or just utter baloney. Ask your friends in various industries what the real sentiment is like. Have there been any recent layoffs? Is your company promoting or hiring? How much work is outsourced to contractors? All these answers will give you a far better understanding of the current job market. The unemployed will give you an even better insight.

The truth is, it’s not easy to find a decent white-collar job anymore. The supposed labor shortage espoused by our politicians is highly attributable to low-skilled labor and part-time gig work. Over saturation of college degrees and work experience requirements have made gainful employment increasingly difficult past entry level positions. Not to mention, there is a clear incentive for corporations to divert work and capital to cheaper foreign labor.

Corporate recruitment is almost exclusively done straight out of universities and internal references. The rise in AI could replace administrative roles and streamline time consuming work currently performed by an individual. As corporations feel pinched, they will seek cost saving measures. Some statisticians have found over 40% of job listings are FAKE to give the illusion of expansionary conditions. The unemployed are climbing an uphill battle that’s turning vertical.

Outlook: The unemployment rate is highly correlated with the Fed Funds Rate. They can only lie for so long, inevitably they will admit the lack of labor force participation.

Real Estate

Low mortgage rates are the backbone of the real estate market. Buyers and sellers are influenced by the cost of debt which is constantly manipulated by central banks. The price bubble in housing has ceased to inflate as higher interest rates trap the existing homeowner with gold plated handcuffs with their 3% mortgage rate. Perspective buyers are holding off for either cheaper rates or cheaper prices, and they are getting neither. The staggering cost of insurance is making homeownership repugnant, but the alternative is unaffordable rents and missing out on the rigged real estate marketplace.

There are significant trends driving regional markets in housing. The rise in remote work has pushed people away from cities and into suburban areas and small towns. While there is still desirable intercity real estate, the average urban home is shrinking, and young families are looking outward. The commuter economy is falling to the rise in at-home work, and Americans are prioritizing space and safety over convenience and lifestyle.

Commercial real estate was crushed over the plandemic as office space became unused and now unwanted. Gentrification picks favorites as the value of lots become heavily influenced by hype and consumer preference. Look where they’re building new apartment buildings, commerce follows the people not the other way around.

Outlook: Mortgage rates will severely lag any Fed fiscal policy. Date the rate as the realtors say. Any significant drop-in interest rates will be met with a race to buy and higher prices. Real estate is rigged to rise in perpetuity, it’s expensive now, but that doesn’t mean it won’t be more expensive later. Be wary of popular markets, prices can be severely unreasonable despite worsening conditions of safety, traffic or poor construction. Investors should look at up and coming markets further from major cities with local economies. Desirable small towns will be the next boom for commercial and residential real estate. Everyone needs a plot of dirt to call their own.

Stock and Crypto Market

U.S. markets will see major inflows as liquidity gets pulled from foreign countries via inflated currency. The U.S. dollar will strengthen with imposed tariffs, but cheaper interest rates will incentivize more borrowing and investment in the stock market. The market in aggregate is stupid expensive because of a few tech stocks. The AI speculative movement will consolidate into a few companies as actual cashflow producing products hit the market. The government can and will pick winners to create monopolies that take all market share.

I do not invest in Banks, War or Pharmaceuticals however they will likely all do well with the rise in changing interest rates, geopolitical risk, political transition respectively. A multipolar world with nationalistic tendencies will create cartels of resources. Countries with major production of particular resources will look to monopolize their market and drive of the price of raw materials.

The safe trade is in utilities and commodity producers (i.e. mining, infrastructure, government contractors). AI and blockchain technology at scale requires more energy usage than currently available. Electrification is on the rise and energy production will need to meet that demand. Oil producers will underperform as production increases, but alternative energy like nuclear will see increased investment/usage while materials become scarce.

U.S. regulators will legitimize the crypto industry. U.S. based companies will look to go public and merge with the existing financial system. Institutional adoption is already here, and the technology is increasingly necessary as banks struggle to find liquidity. Seasoned crypto assets that have stood the test of time and volatility will outperform everything else. Utility will bring about price discovery but it’s still the wild west and not for the faint of heart.

Outlook: Move out of tech and into commodities. The things that society can’t live without will outperform in a market downturn. There is likely a “melt-up” that will precipitate the end of the market cycle. All bubbles end in complete mania prior to the inevitable crash. Cash will move quickly into safer assets with inherent value.

Traditional avenues of investing are become increasingly dangerous. The top of a market is impossible to determine but the warning signs are there. I am taking a defensive approach this year and derisking into cash as things begin to look more dire. I expect lots of volatility in either direction as investors become uncertain and market driving news becomes more frequent. The banks are in distress, the government has $7 trillion in debt maturing this year, and geopolitical turmoil could make global supply chains unreliable. Take control of your own finances and pay attention to changing narratives or significant opportunities stemming from new government regulation/policy.

We either change with the times or fall into obscurity. Asset bubbles create traps in the things that everyone thinks is safe to buy and opportunities in the things no one is talking about. Wealth doesn’t die; it transfers from one state to another so it’s important to situate yourself in the next big thing rather than the prior. Don’t let your hard-earned savings be obliterated by inflation or crash with some overambitious tech company. Take your finances into your own hands before your 401k reallocates your paycheck to the L.A. Dodgers Moneyline or a Jake Paul parlay.

Stock picks

Freeport-McMoRan (NYSE: FCX)

Denison Mines (NYSE: DNN)

Commodity Picks

Platinum (ETF; Miners; Royalty Companies)

Nickle (ETF; Miners; Royalty Companies)

Crypto Picks

Hedera Hashgraph (HBAR)

Quant (QNT)

Algorand (ALGO)

Ripple (XRP)

Notable Real Estate Market

Tri-cities Tennessee