Debt exploding.
Tech sector dominating everything.
Gold inaccessible.
Investors operating with leverage to the limit.
Is this rally grounded or out of touch with reality?
Understand the dynamics of the current mess!
- US public debt has gone parabolic.
Total debt has already reached US$37.9 trillion!
It rose an incredible US$400 billion in September alone, and has already increased US$1.7 trillion since July, when the debt ceiling was lifted.
- And the trajectory is one of continued explosion
At the current pace, the US will reach $40 trillion in debt by 2026.
The debt-to-GDP ratio is already at 124%, the highest level since the peak of the pandemic.
This is the backdrop behind everything that is happening.
- Meanwhile, the market focuses on a single horse: tech.
Tech stocks now account for 38% of the US market value.
The highest level in history—even higher than the 33% seen in 2000, the height of the dot-com bubble euphoria.
- But this is an isolated phenomenon in the US.
In the rest of the world, the tech sector represents only 12% of the global market excluding the US.
In other words, no other country is investing so heavily in a single sector.
This concentration makes the market more vulnerable to specific shocks. Although it seems to make sense given the scale of the current revolution.
- Buying gold with an American salary has never been so expensive.
Today, an average worker in the US needs 116 hours of work to buy a single ounce of gold.
This is the highest level since 1929.
It's not just gold that's risen; purchasing power is plummeting.
- The price of gold won't stop—and wages haven't kept up.
The metal is already worth almost $4,300, while the average hourly wage in the US is only $36.50.
Gold is rising because the dollar is melting. Official inflation doesn't show it, but real wages are getting weaker.
- And market leverage hits all-time high
Margin debt in the US reached $1.1 trillion, the highest level ever.
In September alone, investors borrowed an additional $67 billion to buy assets.
- The risk isn't just in value—but in speed and complacency.
Today, margin debt is equivalent to 2% of the S&P 500, more than during the 2000 bubble.
And there's pressure on the SEC to release ETFs with leverage of up to 5x per day.
This could turn any correction into a collapse.
- When the tide turns, the system can't handle it
With so much leverage, it only takes one slip to turn into an avalanche:
• Margin calls
• Forced liquidations
• Domino effect on prices
This is what happened during the crypto crash on October 10th.
- The math doesn't add up
Record public debt.
Extreme concentration in tech.
Gold out of reach.
Investors leveraging to the limit.
This rally is supported by excess.