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Mike McGlone Warns of US Stock Market Plunge and Shift to Commodities

Bloomberg strategist Mike McGlone predicts a challenging year for US risk assets, with Bitcoin and Ethereum's decline signaling potential underperformance in stocks and a shift towards commodities and gold.
Published on 2025-03-12

US Stock Market and Risk Assets Face Potential Plunge

Mike McGlone, a senior commodity strategist at Bloomberg Intelligence, has sounded the alarm on the US stock market and risk assets, suggesting a difficult year ahead. He points to the sharp decline of Bitcoin and Ethereum as indicators of broader market challenges. McGlone highlights that Bitcoin's drop below $80,000 and Ethereum's fall under $2,000 may signal "reciprocal underperformance" in historically elevated US risk assets.

Shift to Commodities and Gold

McGlone anticipates a "reversion of the multidecade lows in broad commodities vs. the US stock market." He notes that US stocks ended 2024 at record highs relative to the rest of the world, suggesting they were overvalued. This could lead to a shift in investor sentiment from risk assets to traditional ones like commodities and gold.

Bitcoin vs. Gold: A Changing Landscape

In a recent tweet, McGlone shared a chart showing the Bitcoin-to-gold ratio reaching its peak. This indicates that Bitcoin's long-term uptrend may be reversing, with gold potentially regaining dominance as a store of value. Additionally, gold ETF inflows have begun to rise after a prolonged decline since 2022, signaling a shift in investor preference from Bitcoin to gold.

McGlone's analysis suggests that while cryptocurrencies may face a bearish outlook in 2025, commodities and gold are poised for stronger performance as investors seek safer havens.

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