Bloomberg’s commodity strategist, Mike McGlone, forecasts that the American market may face a significant correction, which would strongly impact the prices of Bitcoin, oil, and stocks.
In a post on social media platform X, McGlone stated that America has a “self-adjusting mechanism” capable of resisting President Trump’s trade war, which could lead to chaos in the market.
McGlone shared a chart showing that the S&P 500 to GDP ratio and the S&P 500 to gold ratio are at high levels – a condition that has historically been a sign of stock market crashes, such as in the 1930s, the late 1990s, and in 2008.
According to McGlone, such an event, also known as a “reversal,” could lead to a significant decline in the prices of stocks, Bitcoin, oil, copper, and bonds.
“America’s self-adjusting mechanism is unstoppable. If unprecedented tariffs and austerity measures do not yield results, the backlash will manifest in the upcoming elections. If the major rebalancing efforts succeed, it could reshape the foundations of the world order for the next century.”
The current issue is the increasing instability with the market capitalization ratio of the American stock market to GDP and compared to the rest of the world, which is at its highest level in about 100 years.
My basic scenario for a typical reversal includes:
– 50% off in the American stock market
– The price of crude oil is at 40 dollars per barrel
- The price of the coin is at 3 dollars per pound
– The yield on 10-year U.S. Treasuries is at 3%
– The price of Bitcoin is at 10,000 dollars, most cryptocurrencies have dropped by 90%.
– The gold price is at 4,000 dollars, which is an exception due to not being a simple reversal.
Source: Mike McGlone/XAlthough McGlone’s predictions about the decline seem severe, he believes this potential level of decline is “normal” when considering historical conditions.
At the time of writing, Bitcoin is being traded at a price of 88,435 dollars.
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Mr. Giáo
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