The Sum of All Holidays

While the fireworks pop and grills fire up this Independence Day weekend, markets are showing some interesting gearing under the hood. Our latest look at M2 growth versus the Aggregate Index points to roughly 4-to-1 leveraging of new money into gains over the past year—21.9% higher on the index side. That kind of disconnect has shown up in late-cycle bubbles before, and the recursive patterns suggest watching for liquidity shifts or external shocks that could normalize things the hard way.

Yen carry trade dynamics add another layer worth tracking. With USD/JPY in elevated ranges and BoJ policy divergence in play, a rapid unwind scenario remains a high tail-risk flag—potentially rippling through global assets fast. Our state variance extremes and magic ovals on the majors (Dow holding near upper central tendency while Nasdaq looks more bearish) hint at a market that’s been “painted” in spots, with coherence building for potential downside pressure into the fall window.

Longer-wave 1929 comparisons via the Aggregate keep the perspective sharp—steep rises followed by resets have precedents. Full ChartPack and analysis for subscribers dives into the numbers, projections, and what to watch next. Enjoy the holiday responsibly, stay aware, and think long-wave.

And yes, there will be a ShopTalk Sunday this week – I learned something new!