Why Haven’t Stocks Crashed Yet?
Welcome to The Monthly!
Throughout the month of March, we consistently evaluated the question of “Did the U.S. administration inadvertently cede control of global energy markets to Iran?” What began as a geopolitical flashpoint evolved into a broader liquidity story. Iran’s move to charge vessels for safe passage through the Strait of Hormuz effectively institutionalized a tolling regime
Meanwhile, disruptions to Gulf Coast and Asian economy capital recycling flows pointed to deeper strain beneath the surface. Concurrently, withdrawal restrictions across private credit funds served as an early indication that this liquidity shock is beginning to spill into broader financial markets.
As the month progressed, a secondary question emerged: Why haven’t stocks materially repriced? It is key to remember that investors entered this year with historically constructive views across the macro landscape, and there has not yet been sufficient time or data to drive meaningful downward revisions to growth and earnings forecasts. These negative revisions are forthcoming should the nascent energy supply shock and resulting global liquidity crisis persist.
Widening imbalances in Treasury demand and increasingly hawkish central bank guidance suggest investors should not expect policy support. The bottom line: as long as this crisis persists, liquidity will continue to deteriorate, forcing markets to eventually adjust.
As always, members of our global investor community can trust that our institutional-grade risk management overlays—KISS and Dr. Mo—will help our portfolios navigate these emergent risks better than investors attempting to manage risk without systematic rules or relying on fundamental research alone.
In Case You Missed It
A Global Liquidity Crisis Is Underway… What’s Next?
The escalating U.S.-Israel-Iran conflict has moved beyond an energy supply shock and evolved into a global liquidity crisis. In our opinion, investors are underestimating how disruptions in energy flows and capital recycling are tightening financial conditions and reshaping the macro regime.
If Your Portfolio Is Down YTD, It’s Because of Your Action Bias, Not the Iran Conflict
If your goal is to retire on time and comfortably, then you generally only need to make two risk management pivots per year on average. Stop overtrading your account and start maximizing upside capture in trending bull markets and minimizing downside capture in trending bear markets instead.
Chart of the Month
This chart shows the outsized role of the U.S. economy and U.S. dollar throughout global financial markets. The U.S.’s relatively small share of global GDP and population signals a structural imbalance and suggests that this over-allocation may gradually decline as investors and sovereigns diversify.
Successful Signals From Dr. Mo
On January 28, 2026, our Discretionary Risk Management Overlay signaled a bullish breakout in Crude Oil ($USO). Since the pivot, $USO has appreciated 80%.
Community Spotlight
This month, we’re excited to share feedback from a member of our global investor community. This long-time 42 Macro subscriber has used our KISS and Dr. Mo risk management overlays to achieve outstanding absolute returns and unrivaled risk-adjusted returns—which is precisely what they were engineered to do.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
EXPLORE 42 MACRO RESEARCHIs Iran Now Permanently In Control of Global Energy Markets?
Welcome to The Weekly!
This week’s defining question was simple but consequential: Did the U.S. administration accidentally and permanently cede control of global energy markets to Iran? Monday’s relief rally, triggered by a Truth Social post announcing a five-day diplomatic pause, gave markets a temporary reprieve, but the underlying dynamics have only grown more complex. Iran began charging vessels for safe passage through the Strait of Hormuz, effectively institutionalizing an informal tolling regime.
Meanwhile, Apollo and Ares imposed draconian withdrawal restrictions on select private credit funds. This is a stark reminder that the geopolitically driven liquidity crisis is already spilling into broader financial markets.
By Thursday, the more pressing question became: Why haven’t stocks crashed yet? The answer lies in Bayesian priors. Most institutional investors entered this conflict with generally positive expectations for five of the six key macro cycles, and there hasn’t been enough time or negative economic releases to catalyze material revisions to GDP and earnings forecasts. Those revisions are forthcoming every week this crisis persists.
As always, members of our global investor community can trust that our institutional-grade risk management overlays—KISS and Dr. Mo—will help our portfolios navigate these emergent risks better than investors attempting to manage risk without systematic rules or relying on fundamental research alone.
In Case You Missed It
A Global Liquidity Crisis Is Underway… What’s Next?
The escalating U.S.-Israel-Iran conflict has moved beyond an energy supply shock and evolved into a global liquidity crisis. In our opinion, investors are underestimating how disruptions in energy flows and capital recycling are tightening financial conditions and reshaping the macro regime.
Chart of the Week
The Powell Fed continued expanding its balance sheet deep into 2022, even as inflation exceeded 8% and real GDP growth remained strong. Juxtapose this with the FOMC’s directionally hawkish response to the current negative supply shock and it’s easy to see why members of the political right continue to accuse the Fed of political bias.
As data-driven centrists, we don’t have a dog in this race. We simply wish for better monetary policy outcomes than the legacy of accumulated monetary policy errors from the past ~30 years.
Successful Signals From Dr. Mo
On March 4th, 2026, our Discretionary Risk Management Overlay signaled a bearish breakdown in Communication Services $XLC. Since the pivot, $XLC has corrected 10%.
Community Spotlight
This week, we’re excited to share feedback from a member of our global investor community. Specifically, we are highlighting the personal-best performance investors tend to enjoy once they’ve empowered their investment process with our institutional-grade risk management overlays, KISS & Dr. Mo.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
EXPLORE 42 MACRO RESEARCHA Global Liquidity Crisis Is Underway… What’s Next?
Darius Dale joined Maria Bartiromo on Fox Business to break down why the escalating US-Israel-Iran conflict has moved beyond an energy supply shock and evolved into a global liquidity crisis. He argued that investors are underestimating how disruptions in energy flows and capital recycling are tightening financial conditions and reshaping the macro regime.
If you missed the discussion, here are three key takeaways that likely have huge implications for your portfolio:
1) This Is a Capital Account Crisis, Not Just an Energy Supply Shock
While most investors are focused on the impact of oil supply disruptions on current account dynamics, Darius emphasized that the real issue lies in the capital account. Net international investment surplus economies in the Gulf Coast and Asia are no longer generating the revenue and profits growth required to recycle capital into global capital markets, forcing them to sell assets like gold to raise liquidity.
Key Takeaway: This is not just about oil. There is an enormous breakdown in the global liquidity machine that supports risk assets.
2) Risk-Off Inflation Regime Remains in Place
Darius made clear that as long as the US–Israel–Iran conflict persists, markets are likely to remain in a risk-off Inflation regime. This regime is characterized by rising volatility, tightening liquidity, and pressure across both risk assets and traditional safe havens.
Key Takeaway: Investors should position for continued volatility as long as this conflict remains unresolved, not a quick return to risk-on conditions.
3) The Fed Is No Longer a Backstop
Perhaps most importantly, central banks are not stepping in to stabilize markets—and may actually tighten further. Drawing parallels to 2008 and 2020, he noted that investors are selling what they can to raise liquidity, not what they want to sell. Meanwhile, the Fed’s reaction function has shifted from asymmetrically dovish to a bimodal distribution, introducing the possibility of rate hikes if inflation pressures persist.
Key Takeaway: Central bank support appears unlikely over the medium term, and markets must price this risk accordingly.
Final Thought: Geopolitics Leads Liquidity and Liquidity Drives Asset Markets
Markets are transitioning from a liquidity-supported environment to one defined by scarcity, volatility, and geopolitical risk. In short, the longer the US-Israel-Iran war persists, the greater the reduction in liquidity—and decline in asset markets—investors will experience.
If you are not confident your portfolio is positioned correctly for the evolving macro landscape, partner with 42 Macro for data-driven insights and proven risk management overlays—KISS and Dr. Mo—to help you stay on the right side of market risk.
No catch—just real insights to help you stay ahead in the #Team42 community.
Best of luck out there,
— Team 42
Is It Safe To Buy The Dip?
Welcome to The Weekly!
Not Likely. The US-Israel-Iran war remains far from resolved, and global liquidity will likely continue to ebb for as long as it persists. With the conflict exhibiting few signs of de-escalation, the probability that it devolves into a multi-month overhang for markets increases. Our deep study of economic and geopolitical history leads us to conclude that militaries don’t destroy empires. Egos and excessive debt do.
On the macro side, recent data has been broadly supportive of our GRID Model projections of accelerating growth and slowing core PCE inflation. However, marginally hawkish forward guidance from the Fed, BOJ, BOE, and ECB are signaling that investors who have yet to lower their gross and tighten their net exposures should not expect to be bailed out should the global energy supply shock continue to devolve.
Meanwhile, the January TIC data continues to support our Geopolitically Driven Supply-Demand Imbalance in the Treasury Bond Market thesis, with the widening divergence between foreign demand for Treasury coupons and foreign demand for US corporate stocks and bonds now in plain sight.
As always, members of our global investor community can trust that our institutional-grade risk management overlays—KISS and Dr. Mo—will help our portfolios navigate these emergent risks better than investors attempting to manage risk without systematic rules or relying on fundamental research alone.
In Case You Missed It
Why Is the Next Historic Geopolitical and/or Financial Crisis Likely to Occur Within 5–7 Years?
Enjoy this excerpt from our March 2026 monthly Macro Scouting Report webcast in which we detail some of the math behind our conclusion that the timeline for the US to be mired in a historic geopolitical and/or financial crisis is much, much shorter than the median investor realizes.
Charts of the Week
When the dollar, currency volatility, global interest rates, and bond market volatility spikes, global liquidity tends to fall. These countercyclical relationships, tracked here from 2010 to 2026 via the 42 Macro Global Liquidity Proxy, serve as a powerful leading indicator for risk assets.
Successful Signals From Dr. Mo
On March 6th, 2026, our Discretionary Risk Management Overlay signaled a bearish breakdown in Gold Miners $GDX and Silver Miners ($SIL). Since the pivot, $GDX and $SIL have crashed -21% and -22%, respectively.
Community Spotlight
This week, we’re excited to share feedback from a member of our global investor community. Specifically, the real-life impact that KISS has had on their mental and physical health.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
EXPLORE 42 MACRO RESEARCHIs Global Liquidity Breaking Down?
Welcome to The Weekly!
Yes. Global liquidity is showing signs of deterioration. Whether this represents a transitory pullback or a trending breakdown depends on POTUS, his Department of War, and how much they care about the midterm and 2028 elections.
Currently, China (4%) and the US (2%) are the only major liquidity-supplying economies expanding liquidity on a 3mo SAAR basis. Liquidity in the Eurozone, Japan, Switzerland, and UK is down -17%, -8%, -9%, and -13%, respectively, on a 3mo SAAR basis. This is why global liquidity is down -4% on a 3mo SAAR basis as well. Recall that the US dollar, currency volatility, bond market volatility, and energy are all countercyclical leading indicators of global liquidity per the 42 Macro Global Liquidity Proxy, and each is bullish from the perspective of our Volatility-Adjusted Momentum Signal (VAMS).
In short, we continue to believe that it is likely the longer the US-Israel-Iran war persists, the greater the reduction in liquidity—and decline in asset markets—investors will experience.
As always, members of our global investor community can trust that our institutional-grade risk management overlays—KISS and Dr. Mo—will help our portfolios navigate these emergent risks better than investors attempting to manage risk without systematic rules or relying on fundamental research alone.
In Case You Missed It
What Should Investors Do If Their Portfolio Is Down YTD?
Enjoy this clip from our December 5, 2025, monthly Macro Scouting Report webcast in which we unpack signals from two of the core elements of our macro risk management process – our proprietary Positioning Model and Macro Weather Model – alongside key fundamental signals from the inflation and liquidity cycles.
These and other signals are why our global investor community entered 2026 with a non-consensus expectation of turbulence and violent factor rotations in asset markets.
Chart of the Week
As Predicted, Private Sector Wage Growth Is Demonstrably Underperforming Survey-Based Measures Of Labor Market Slack
Private sector wage growth is continuing to underperform traditional survey-based measures of labor market tightness. While indicators such as small business hiring difficulty and the share of firms reporting few qualified applicants remain elevated, realized wage growth has been trending lower.
Successful Signals From Dr. Mo
On December 17th, 2025, our Discretionary Risk Management Overlay signaled a bearish breakdown in Business Development Companies (purveyors of private credit) $BIZD.
Since the pivot, $BIZD has depreciated 15%.
Community Spotlight
This week, we’re excited to share feedback from a member of our global investor community. Specifically, the spectacular performance 42 Macro clients experience, thanks to our KISS and Dr. Mo signals.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
EXPLORE 42 MACRO RESEARCHIs Your Portfolio Positioned for Rising Geopolitical Risk?
Welcome to The Weekly!
Geopolitical tensions intensified this week as conflict in the Middle East escalated, amplifying market anxiety related to a protracted energy supply shock and a repricing across sovereign debt curves. Brent crude oil shot up to the mid-90-dollars per barrel as investors grappled with the conflict’s duration and potential for sustained disruption to global energy supplies.
While consensus is variably pricing a broader conflict, the highest probability outcome in our view is “this too shall pass”, ultimately leaving asset markets in a healthier condition after unwinding the historic degree of crowded bullish positioning we’ve consistently warned about since early November. In the near term, geopolitical suspense will likely give the Powell Fed cover to further delay normalizing monetary policy.
Onshore, corporate layoffs (namely Morgan Stanley $MS) tied to the AI disruption trade continue to reinforce the Jobless Recovery thesis. Regarding the February Jobs Report, weak negative impulses in Private Sector Employment, Average Weekly Hours, Private Sector Labor Income, and strong negative impulse in Private Sector Average Hourly Earnings in February supported our Jobless Recovery, Structural Uptrend in Productivity Growth, and Continued Disinflation Driven by Housing and Labor theses.
As always, members of our global investor community can trust that our institutional-grade risk management overlays—KISS and Dr. Mo—will help our portfolios navigate these emergent risks better than investors attempting to manage risk without systematic rules or relying on fundamental research alone.
In Case You Missed It
Will AI Drive the Next Wave of Global Equity Leadership?
On Thoughtful Money (watch here), Darius joined Adam Taggart to answer several of the key questions being asked within our global investor community amid accelerating macro and geopolitical uncertainty.
42 Macro is also pleased to announce our new partnership with Thoughtful Money, expanding the reach of our platform to hundreds of thousands of independent investors around the world. Be sure to check out the discussion to learn more.
Chart of the Week
Along Globalization, The Diffusion Of Internet Technology — Which Is Far Less Productivity-Enhancing Than AI — Contributed To A Jobless Recovery In The Early 2000s
A similar dynamic may be emerging as AI accelerates productivity while simultaneously reducing labor demand across white-collar industries. If AI proves even more productivity-enhancing than internet technology, the U.S. economy could once again feature strong economic growth alongside persistent labor market slack, reinforcing our Jobless Recovery thesis.
Successful Signals From Dr. Mo
On January 28th, 2026, our Discretionary Risk Management Overlay signaled a bullish breakout in Crude Oil $USO. Since the pivot, $USO has appreciated 42%.
Community Spotlight
This week, we’re excited to share feedback from a member of our global investor community. Specifically, the incredible ROI that 42 Macro provides to our community.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
EXPLORE 42 MACRO RESEARCHWill AI Drive the Next Wave of Global Equity Leadership?
Darius Dale recently joined Adam Taggart on Thoughtful Money to explain why investors may be misreading the current macro environment. While the S&P 500 has moved sideways in recent months, Darius argued this is not a topping process. Instead, markets are likely experiencing choppy rotation due to a historic degree of crowded bullish positioning and the convergence in profitability and valuations across sectors, industries, and geographies due to AI-led productivity gains.
If you missed the discussion, here are three key takeaways that likely have huge implications for your portfolio:
1) What Looks Like a Market Top Is Likely Just Rotation
42 Macro’s market regime nowcasting signals still point to a risk-on Goldilocks environment, with growth, monetary policy, and liquidity providing tailwinds for risk assets. The sideways action in U.S. equities is largely the result of historically crowded positioning in mega-cap tech unwinding as investors rotate into other parts of the market.
Key Takeaway: The current chop is likely not a topping process. Instead, it is likely a rotation from crowded mega-cap tech into international equities, small caps, and cyclicals.
2) AI Diffusion Is a Convergence Catalyst
We believe that corporate AI adoption will drive convergence in productivity, profitability, earnings growth, and valuations across sectors, industries, and geographies. Because many international markets start from lower comparative bases with regards to productivity and profitability, the rate of change could be faster than what we see in U.S. markets, which are already dominated by highly profitable mega-cap tech companies.
Key Takeaway: Markets starting from lower trend rates of productivity growth are likely to experience the fastest productivity gains amid accelerating AI diffusion.
3) Paradigm C Remains a Powerful Growth Backdrop
The current macro environment is still best described using our Paradigm C framework, a regime where fiscal expansion, monetary easing, and deregulation are all occurring simultaneously to “run the economy hot”. When those three forces align, the result is typically above-trend economic growth and strong tailwinds for corporate profits and risk assets.
Key Takeaway: Investors should not fight a macro backdrop where fiscal policy, monetary policy, and deregulation are all pushing growth higher.
Final Thought: Position for the Rotation
Markets may remain choppy as crowded positioning unwinds, but the broader risk-on market regime remains intact. By year-end, we expect investors to be satisfied with returns in the equity and credit markets—especially those who invest beyond the traditional mega-cap tech companies.
If you are not confident your portfolio is positioned correctly for the evolving macro landscape, partner with 42 Macro for data-driven insights and proven risk management overlays—KISS and Dr. Mo—to help you stay on the right side of market risk.
No catch—just real insights to help you stay ahead in the #Team42 community.
Best of luck out there,
— Team 42
Can Markets Thrive Amid Policy Uncertainty and AI-Driven Labor Disruption?
Welcome to The Monthly!
This past month’s market action reinforced just how much uncertainty there remains surrounding the long-term outlook for U.S. monetary policy, even as renewed scrutiny regarding ballooning AI capex budgets drove meaningful dispersion within global equity markets. Cross-asset volatility intensified after the nomination of Kevin Warsh for Fed Chair, while investors simultaneously parsed the deflationary risk AI disruption poses to non-technology industry profits.
The Resilient US Economy continues to recover from its U-shaped slowdown, propelled by fiscal expansion and employment growth in government-adjacent sectors like health care, education, and social services while private-sector hiring remains stagnant. The risk of a jobless recovery remains elevated with meaningful implications for inflation and corporate profits.
In our view, the stock market can still perform well if AI permanently impairs the labor market. Much like globalization and the federal tax code which codifies egregiously preferential treatment to capital income over labor income, AI is simply another tool engineered to consolidate wealth and power. History has already proven that such consolidation is not bearish.
Make no mistake, understanding how these dynamics differ from past cycles is critical for navigating what comes next.
In Case You Missed It
Is Crowded Positioning the Real Driver of AI Volatility?
On Fox Business, Darius joined Maria Bartiromo to discuss why recent volatility surrounding fears of AI disruption are more a function of historically crowded bullish positioning than a deterioration in the structural growth outlook.
Widespread AI adoption is likely to drive a sustained uptrend in productivity, corporate profits, and disinflation, but markets must first work through positioning imbalances.
Could Bank Deregulation Reshape Market Liquidity?
The announcement of Kevin Warsh signals a potential shift in liquidity provisioning from the Federal Reserve back to the commercial banking sector.
We believe that substantial bank deregulation would be required to reduce the Fed’s footprint without destabilizing markets—thus rendering bank deregulation as the only logical choice.
Chart of the Month
The True Promise Of AI Isn’t Mere Efficiency; AI Is An Effective Tool To Cut What Is Still Most Companies’ Biggest Cost — Labor
This chart highlights the long-term tug-of-war between labor’s share of income and capital’s share of income in the U.S. economy. As AI proliferation accelerates, companies are increasingly using technology to compress labor costs, reinforcing a regime of rising margins and productivity gains that supports corporate profitability over the medium term.
Successful Signals From Dr. Mo
On November 29th, 2025, our Discretionary Risk Management Overlay signaled a bullish breakout in Commodity Producers $GNR. Since the pivot, $GNR has appreciated 25%.
Community Spotlight
This month, we’re excited to share feedback from a member of our global investor community regarding the immense value of our risk management signals, which allow them to make high-quality investment decisions in a fraction of the time.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
EXPLORE 42 MACRO RESEARCHWhat Matters More, AI Disruption or Bank Deregulation?
Welcome to The Weekly!
Recent divergence in global equity markets reflects mounting scrutiny of corporate AI capex trajectories, as market participants parse both escalating investment commitments and the deflationary risk AI poses to non-technology industry profits.
From this starting point, bank deregulation appears to be a greater upside risk than AI disruption is a downside risk, as (1) regulators broadly align on a deregulatory trajectory tied to the recalibration of the US Basel III Endgame framework, and (2) Paradigm C—the growth phase of the cut → grow → print sequence required to address the geopolitically driven supply-demand imbalance in the Treasury bond market continues to be the dominant driver of the economy and asset markets.
Elsewhere, the Q4 GDP and December PCE data supports our Resilient US Economy, U-Shaped Economy, and Sticky Inflation themes, broadly aligning with the latest FOMC projections of a ~2% real growth and 2.5–3.0% inflation US economy.
In Case You Missed It
This Is What Kevin Warsh Will Say About the Labor Market to Fix the Fed’s Broken Reaction Function
Enjoy this excerpt from our February 14, 2026 | Around the Horn webcast breaking down the declining dynamism of the US labor market as indicated across dozens of key high- and low-frequency economic statistics.
Our research continues to view the Fed’s reluctance to return the policy rate to a neutral setting as perpetuating a likely jobless recovery. Additionally, we project a structural uptrend in productivity growth, which will likely cause an even greater bifurcation between the outlooks for GDP and corporate profitability and the outlooks for employment, consumer confidence, and incumbent politicians.
Chart of the Week
The Diffusion of AI Throughout The Global Economy Favors International Stocks Over US Stocks As Productivity Converges
As AI adoption spreads across the global economy, productivity gains are broadening beyond the U.S. While U.S. firms have led in recent years, the convergence of global productivity trends suggests international equities may be positioned to benefit as AI-driven efficiency gains become more evenly distributed across developed and emerging markets.
Successful Signals From Dr. Mo
On November 29th, 2025, our Discretionary Risk Management Overlay signaled a bullish breakout in Energy $XLE. Since the pivot, $XLE has appreciated 21%.
Community Spotlight
This week, we’re excited to share feedback from a member of our global investor community. Specifically, the data-driven discipline that 42 Macro provides to our community.
It’s always rewarding to see KISS and Dr. Mo deliver meaningful outcomes for investors around the world. We truly appreciate your feedback.
Parting Shot | Factor Risk
Market risk is one thing. Factor risk is another.
Staying on the right side of the cycle is difficult. Staying on the right side of growth vs. value, U.S. vs. international, quality vs. beta, across multiple rotations, is exponentially harder.
Factor rotations occur more frequently than market cycles. The probability of stacking consistent wins declines dramatically.
Most investors don’t need factor alpha. They need disciplined exposure to beta and systematic risk management.
Explore 42 Macro’s KISS and Dr. Mo and discover the frameworks and signals that underpin our systematic approach to managing risk.
EXPLORE 42 MACRO RESEARCHWill Inflation Cause Asset Markets to Devolve From Violent Chop Into a Violent Drawdown?
It’s the Valentine’s Day & President’s Weekend’s Edition of the The Weekly!
In answer to the question:
No, this bearish scenario is unlikely according to our cyclical and structural research views related to the inflation cycle. The just released softer-than-feared inflation print spurred incremental conviction around prospective Fed easing, driving rates lower and leaving equities marginally changed as investors closed out a volatile trading week with a sigh of relief.
The recent correction instead likely signals an acceleration in AI diffusion. As we have detailed, a wider adoption of AI technology represents a durable positive shock to productivity, which represents a positive shock to corporate profitability and negative shock to trend inflation.
Related, the Resilient US Economy is recovering from its U-shaped slowdown, but the upturn is being propelled by fiscal expansion and government employment while private-sector hiring stagnates—setting up a jobless, AI-accelerated recovery with historic implications for inflation and corporate profits.
Make no mistake, understanding how these dynamics differ from past cycles is critical for navigating what comes next.
As always, members of 42 Macro’s global investor community will have deeper insights into our views and how our institutional-grade risk management overlays, KISS and Dr. Mo, help investors maximize gains in bull markets and minimize losses in bear markets.
In Case You Missed It
If Your Stomach Is Dropping From Market Ups And Downs, Here’s Why
Enjoy Forbes‘ recent piece (read here) examining the surge in cross-asset volatility as stocks, metals, and crypto all sold off in tandem.
As Darius highlights in the article, there is a key structural shift underway: a growing inverse relationship between dollar and currency volatility, driven by the growing geopolitical supply-demand imbalance in the Treasury market.
Chart of the Week
The Dramatic Underperformance Of Employment Growth Relative To The Growth Of Labor Supply Supports Our Jobless Recovery Thesis
Employment growth is dramatically underperforming relative to labor supply growth, supporting 42 Macro’s Jobless Recovery thesis. AI diffusion and capital deepening are boosting output and productivity without a commensurate rise in hiring.
Successful Signals From Dr. Mo
On November 29th, 2025, our Discretionary Risk Management Overlay signaled a bullish breakout in Global Commodity Producers $GNR. Since the pivot, $GNR has appreciated 21%.
Community Spotlight
This week, we’re glad to share a Valentine from a member of our global investor community. Specifically, the unmatched value that 42 Macro provides.
It’s always fulfilling to see KISS and Dr. Mo create positive outcomes for investors around the world. Thank you.
Parting Shot | The Cantillon Effect
Money is never neutral. It enters the system somewhere, and the first recipients benefit most.
The Cantillon Effect explains why new liquidity often lifts asset prices and government-supported sectors before it shows up in wages or broad consumer prices. The sequence matters.
In cycles shaped by fiscal expansion and shifting liquidity flows, identifying where capital is moving can be as, or even more important than reacting to headline data.
Explore 42 Macro’s KISS and Dr. Mo and discover the frameworks and signals that underpin our systematic approach to managing risk.
EXPLORE 42 MACRO RESEARCH