YWR: Boom Charts. Pt 2

Erik

Aug 26, 2025

∙ Paid

It’s good to see traders getting bullish on China again.

It’s a reminder how opinions change.

Last year China was ‘uninvestable’ (Unleash the Cash Dragons).

Now it’s hot.

But the stock market of the #2 economy in the world waking up is a positive signal about something else.

That a global boom is underway.

Another controversial YWR view.

Back in May, in the midst of the chaos, we brought you the Global Boom Charts.

This month in Killer Charts we follow it up with more boom charts.

It’s 37 slides with sections on the following:

The No Growth Sentiment
The US Consumer is Under Leveraged and Employed
Is the Glass Half Full? (global manufacturing sentiment)
A Weak Dollar Regime
India is the new China.
The China Bull Market.

Below are 8 highlight slides with a link to the full presentation at the bottom of the post.

Let’s set the scene. Let’s start with sentiment.

What’s something nobody thinks can happen?

Hint. It’s why people love Bitcoin and Gold and AI stocks.

Key slide #1: The No Growth Sentiment

The most consensus view is that the world can’t grow. Stagnate yes. Grow no. PM’s say to buy inflation plays, and tech because the rest of the world is screwed.

Nobody thinks a Boom can happen.

#2 The US consumer is more than ‘OK’.

Let’s start with the bedrock of the global economy; the US consumer. The US consumer is always ‘rolling over’.

Except in reality the US consumer has never been better. The unemployment rate is at historic lows and US households are rich. US consumer debt growth has been minimal since the GFC (2.1% CAGR), while asset growth in real estate, stocks and 401K’s has been stellar. Their balance sheet looks great.

Through policies such as 401k’s and home ownership US consumers have benefited from rising asset prices in a way that is rare in the rest of the world.

#3 But a weak dollar gets the rest of the world going.

The US consumer is solid, but it’s time to wake up the rest of the world.

The dollar is the lead. It moves first. Everything in the cycle flows from there. Gradual $ weakness is not a negative. It’s a positive. It’s the slow realisation it’s safe to go back into the rest of the world.

#4 Step 2: EM rates can fall.

The next step after currency stability, and calmer inflation, is rates start to fall in emerging markets. Brazil stands out with very high real rates.

#5 Step 3 International equity markets outperform. Investors know international markets look attractive, but they are always paranoid about the FX risk.

But what if ‘FX risk’ becomes an ‘FX tailwind’?

What started with the FX markets, and spread to the fixed income markets, next flows into the equity markets and finally the real economy (cranes).

#6 Businesses sentiment globally is positive with room to improve.

Businesses are slightly positive (52.7), but full of uncertainty. Which is natural because we are at an inflection point.

But rather than see sentiment as being on the cusp of declining, could it be about to rise? Is this actually a good level from which to improve? Is the glass half full?

European PMI readings are rising. Does the bullishness in Chinese stocks mean their PMI’s could be about to rise too? India is already the most bullish (60.7).