Credit and financial conditions continue to be a headwind for stocks. Every Monday morning we run through our State of the Market during our live coaching call with members. Randy brought up two great charts: 1. Credit spreads in relation to the S&P 500 2. The National Financial Conditions Index Both are inversely correlated to the performance of $SPY and both are showing serious issues with a sustainable uptrend. You can think of this pair of charts as the ease at which the market thinks liquidity can get to the companies that need it. And right now they're telling you to be very careful. I'm going to cover this in more depth next week during a webinar that I am hosting on helping define the market environment before placing trades. The goal is to help you save money by not overtrading when markets are punishing being aggressive. It's free. If you're interested, DM me and I will send you the info. Limited spaces so first come, first served.

My new 2 cents about the Brazilian fiscal trajectory under Lula IV: stress assumptions looks increasingly unsustainable I am assuming 1% real GDP growth (being optmistic here), a stable 12% Selic for the next four years (being optmistic here), and the primary deficit continuing to expand at its recent average quarterly pace, Brazil’s gross debt/GDP is projected to climb from 93% today (FMI Number) to roughly 120% by October 2030. The nominal deficit would rise toward 13–15% of GDP, driven overwhelmingly by interest costs on a rapidly growing debt stock. With nominal growth around 5–6% and interest rates stuck at 12%, the debt dynamics will turn into a classic snowball. This raises serious questions about the medium-term value of Brazilian sovereign bonds and the attractiveness of long BRL exposure. A debt ratio heading toward 120% under high real rates increases both rollover risk and the probability of further currency depreciation or fiscal adjustment forced by markets. Without a credible path to meaningful primary surpluses or substantially lower rates, the risk-reward on Brazilian duration and the real looks skewed.

Lula is back. Adios $EWZ

Pretty much. As of the past few weeks, debt markets have almost entirely shut off access to money for any company that doesn’t have substantial revenue independent of AI data centers. SpaceX closed $40B of debt for GPUs, but we’re investment grade and have Starlink & launch revenue. That means the 200+ neoclouds are going to see guppy-level death and consolidation. Some will make it through, but not many.

99.9% of people posting about ETF flows don't understand how they impact the durability of a trend. Outflows do not mean price is going to collapse anymore than inflows mean price will immediately rise. It's the consistency and positioning that matter. This is a nothingburger

Want to make a lot of money? Do this. Take my Flush Reversal tear sheet and throw it into your LLM. I use Grok Bot for this. Take a screenshot of the current market internals, plus what you want to trade. Ask it for the game plan off the open. Better than a $1,000/mo mentor.

Beauty of a base breakout in RingCentral $RNG 4 year highs, post earnings