This Week in Barrons: 3.9.2025

• As the 'degenerate economy' accelerates… PLEASE, learn how to spot the Greater Fool, and be careful that it’s not YOU.? As digital degeneracy explodes and consumer protection implodes: ‘Let the Buyer beware.’?
• Citigroup accidentally credited $81 Trillion to a customer’s bank account… instead of their $280 transaction.? The 2 staffers assigned to review transactions failed to notice a single transaction that was 12 times the ENTIRE U.S. Federal Government budget. ?A third employee caught the mistake, and put a stop to it before any funds actually left Citigroup.? The bank described the incident as a ‘near miss’.? Last year, Citi had 10 ‘near miss’ errors of over $1 Billion.? [FYI: Maybe it’s Citi’s new marketing campaign:?‘We’re Citigroup – Where our blunders boost your bottom line.’]
• The Opposite of a Good Idea … could also be a good idea.? Per Seth Godin: the hard part isn’t finding the proof before you begin.? The hard part is beginning – knowing that you may not succeed.
• Specifics ALWAYS help to clarify and cement understanding.

The Markets:

• Overall: Per Fischer King: “Trump’s mass deportations, combined with Elon’s firing people and reducing the deficit – will cause an initial severe overreaction in the economy.”? After all, our economy is propped up by debt and artificially suppressed wages – so markets will tumble.? But ‘this too shall pass’, and we will be left with sounder footing, and a recovery to a healthier and more sustainable economy.? To these thoughts Elon said: “That sounds about right.”
• Bull markets End with euphoria, and Rollover on declining earnings growth.? Overall, mortgage rates are coming down, and I’m also sensing market panic with the VIX hitting 27.? BUT, March is statistically one of the most bullish months for the stock market.? Currently, markets are being driven by extreme fear. ?ALWAYS: BUY fear and SELL greed.? We still have some volatility over the next two weeks, and my guess is that we’re about three-fourths done with the current move lower.? Treasury Secretary Bessent said: "The housing market is stuck, but sometime in the next few weeks, it is going to unfreeze".? I’m also liking Uranium here because the previous uranium hype has deflated the balloon just as nuclear policy transformation is coming.? However, if we cannot get a proper market flush, then markets will just move sideways.
• 5 Sins that Investors most often make: (a) Forget to do the Math.? (b) Chase Shiny Objects.? (c) Confuse knowledge with Unique knowledge.? (d) Forget to Keep-it-Simple.? And (e) Turn Speculation into Investing.

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InfoBits:

• OpenAI needs to make money … and to that end, they’re preparing to launch?a suite of specialized AI agents.? These AI agents will cost $2,000 a month for a business professional, $10,000 a month for a software developer, and $20,000 a month for Ph.D.-level researcher. ?
• ChatGPT was visited a record 610m times in February … as people are finding ways to enjoy spending time with AI chatbots.
• Meta will spin off?Reels, its short-form video product … and launch a stand-alone Meta AI app as a ChatGPT competitor.
• Apple's AI-powered Siri have been pushed back to 2027.? That’s a century away in AI dev-years.? With Amazon’s Alexa and competitors leveling up – are we seeing a full-blown Apple AI emergency?
• TSMC (Taiwanese Semiconductor Company) will invest $100B … in the U.S. – building 5 additional chip facilities & hire 20,000.
• T-Mobile's parent Deutsche Telekom + Perplexity just announced … their new ‘AI Phone’.? It’s a real-time language translator, podcast creator, and avatar generator.? It will be a Q3 release for under $1,000.
• ‘Detroit, we’ve got a problem’… your automobile profit margins are ridiculously thin; therefore, some models will need to raise their sticker prices by the entire amount of the new tariff (25%).? [And THAT’S gonna leave a mark.]
• Uber + Waymo went to school on Tesla … as Uber in Austin, Tx. is now offering passengers the ability to opt in for rides in Waymo’s driverless Jaguars. ?Uber and Waymo beat Tesla (HQ’d in Austin) to offering driverless rides.
• BlackRock is buying majority stakes in Panama Canal ports … putting a U.S. firm in control of a key Trump targets.
• Coming soon near you – half-price Wegovy … Novo Nordisk is trimming the price tag for a slimmer waistline.
• 25-year-old pro video gamer Jacob Worthington made $250,000 … after winning this year’s Madden Bowl.? That’s ~$75,000 more?than what the individual players took home after winning this year’s actual Super Bowl.
• The US economy added 151,000 jobs in February … all the while revising January’s payroll lower by 125,000 jobs.? But we really only added 15,000 jobs, because our government included 136,000 ‘fake jobs’ created by its own Birth/Death model.? Also, the unemployment rate rose to 4.1%. ?

?Crypto-Bytes:

• Trump Fire Festival’d all of the attendees…? of the First Crypto Summit.? They heard crypto-rhetoric, and FIFA’s soccer head ask the room if anyone was up for launching a FIFA coin – live.? [So much for 2-crypto-steps forward.]
• Bitcoin exchange balances continue to plummet … suggesting that bitcoin holders are unwilling to sell their bitcoin at these levels.? Prices will have to substantially increase in order to unlock more liquidity from the long-term holders.
• Bitcoin ETFs are not the only buyers of BTC … Japan’s Metaplanet continues to acquire as much bitcoin as possible == ~500 bitcoin in the last day.
• Circle finally figured out that their crypto ‘experience’ sucks…? and introduced Modular Wallets with Passkeys.? Users can now authenticate transactions with Face ID and biometrics – basically where wallets should-have-been five years ago.
• Good News… ?The U.S. Government has officially recognized the world’s largest cryptocurrency as a strategic asset and correspondingly established a strategic bitcoin reserve.? It will initially be funded by bitcoin seized in criminal and civil forfeiture cases.? And, “The Sec. of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional bitcoin, provided those strategies have no incremental cost to American taxpayers.”?
• Bitcoin Magic Levels:

o? $70,000 == ‘Final Boss’:?If support crumbles there, it’s lights out for any bullish momentum and it would be the last stand for any heroic comeback.

o? $86,000 == the ‘Air-Gap’ Zone:? A no-man’s-land where if not defended – a drop to $70k would be imminent.

o? $92,000 == the ‘Momentum Magnet’:? If Bitcoin can reclaim this ‘short-term holder cost basis’, it will resume its climb to all-time-highs.

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TW3 (That Was - The Week - That Was):

• Monday:? On Sunday, bitcoin prices jumped over 9% to over $94,800 (after falling as low as $78,273 on Friday morning) following Pres. Trump’s recent executive order on digital assets.? The Exec. Order created a ‘Crypto Strategic Reserve’ that will hold Bitcoin, ETH and other U.S. focused tokens such as: XRP, DOGE, SOL & ADA. ?This market is nervous about 2 things: (a) Trump’s big address to the nation on Tuesday night, and EU + Ukraine pounding the drums of war.? Many believe that the Ukraine + France + Germany + UK want to put Russia in its place.? They believe the reason that large shipments of gold were sent to the US. was that they fear a European theatre war – and want their gold out of their respective countries.? Follow the money.? During every war, there are people who: ‘Know & See Things’ – before everyone else does.? The reason for gold and silver being up ~2% today is that things are just not right in market-land.
• Tuesday:? The Dow Jones Industrial Average is now down 1,800 points in 24 hours.? The S&P 500 is 3% away from entering correction territory, and the Nasdaq is just 0.5% away.? This is getting real. ?Right now, people are looking for a return of their money, not on their money.? The next support on the DOW is at about 42,800, and after that it's the 200-day at 41,800.? The S&P has actually come down to its 200-day and is trying to stop the bleeding.? The NASDAQ has plunged through its 200-day.? It’s the speed of this decline that is causing the pain.

?? The /ES futures are trading well below the critical 5911 level. ?The 5911 level represents the gateway back into the?Volatility Box.? It’s a level traders use to gauge whether the market is stabilizing or spiraling further into bearish territory.? If /ES futures can rally back to 5911 and hold above it, we’d be giving traders more opportunities for short-term setups.??But if the market continues to struggle below 5911, it signals that sellers remain firmly in control, and that next step could be a doozy.? For now, 5911 isn’t just resistance; it’s the market’s beacon of hope for a recovery. ?Until then, this market’s next move remains lower.

Morgan’s Moments…?

• Tariffs: “Just the facts.”? Here is a list of Canadian tariffs on U.S. goods: Butter = 298%, Milk = 270%, Cheese = 245%, Chicken = 238%, Eggs = 163%, Sausages = 69.9%, Barley Seed = 57%, Copper = 48%, Aluminum =?45%, Steel = 25%, Cars = 45%, Televisions = 45%, and Lumber = 15%.
• The White House’s Approach via Secretary Bessent: (a) Cut Government Employment, Medicare, Food assistance, School Lunches, and Low-income housing.? Do this along-side: (b) Massive corporate tax cuts, Gutting the IRS, Increasing Deregulation, and ‘Drill baby Drill’.? The final piece will be a: (c) Return to Quantitative Easing and Loosen Monetary Policy.
• Who’s Winning the AI Chatbot race?? I tried asking various AI chatbots for a list of the big tech news stories of the day. ?OpenAI’s ChatGPT and xAI’s Grok both delivered a good list, and ChatGPT even offered up links.? Google’s Gemini, not so much.? It just offered-up a couple vague bullet points with no specifics.? I then asked the same 3 chatbots to pull some data from SEC filings.? ChatGPT instantaneously pulled the numbers, and Grok was right behind it with an equally good answer.? Google’s Gemini said that the problem was ‘challenging to answer without digging into every financial report’.? Duh Gemini – that’s the point!? Gemini’s performance was poor.? I was even paying for Gemini, but not for Grok or OpenAI.? How is it possible that Google, the once-great tech company that invented this entire arena – is this far behind its rivals??

Next Week: Did we hit bottom?

• Overall:? ?I’d say there is a good chance of a short-term rebound, but given the looming macro risks, global vs USA rotation, and un-ignorable issues like expensive valuations – we are looking down the barrel of a bear market.
• The Selling this past week was violent.? ?The financials moved to all-time-highs on Monday, and then sold themselves two standard deviations lower by Friday afternoon.? The S&Ps hit 5673 early on Friday, but remain in over-bought territory on a monthly chart.? So, we’re just beginning to really feel selling that matches consumer pessimism.? While sectors like the home builders and consumer discretionary are getting decimated – healthcare (XLV) remains higher by +9% YTD and consumer staples (XLP) = +6%.?

TIP #1: If you can still find substantial sectors up by almost double-digits YTD, this market has NOT hit bottom.??

• Higher degrees of correlation are still not there… but we did touch that level on Thursday for an hour.? Without correlation we cannot have capitulation; therefore, we are NOT finding a bottom as of yet.? If the SPY went all the way down to 500, we would still not erase all the gains from last year.?

TIP #2: Begin to look at 3 and 5-year charts, to see where we could potentially end-up if things continue sideways to down.

• Big-Boy Pants == Volatility Backwardation… but even after hitting one standard deviation higher on the VIX on Friday – selling was still methodical and orderly.?
• Use OPTION SPREADS to trade this market… because of the high volatility.? The minute this marketplace smells a rally, it will crush volatility much lower.?

Tip #3: To avoid feeling a Volatility Crush, use Options Spreads to protect your positions.?

?? Even in the middle of a rip-your-face-off rally, buy a SPREAD instead of a straight Call Option – because of this high volatility.

• The S&P (SPX = $5770) Expected Move (EM):

-?????? Last Week’s EM = $112, and we moved over $200 lower – outside the EM.

-?????? Next Week’s EM = +/- $151, and that tells me to SELL / FADE any rallies because we have NOT found the bottom quite yet.?

• The Bitcoin (IBIT = ~$49.5) Expected Move (EM):

-?????? Next Week’s EM = +/- $3.5 … a 7% EM for the week!

TIPS:

• If I were only reading the technicals… ?this looks to be a bull market correction; therefore, both sentiment and positioning support the case for a short-term rebound.? But Mag-7 Valuations & Allocations are still high, and that coupled with a Global (up) / USA (down) mentality – produces a ‘further rotation for longer’ movement that’s gaining popularity.? Per Callum Thomas: there’s also a ‘gradually at first – then suddenly’ program working where global risk and headline fatigue are weighing on investor sentiment.? This is starting to be reflected in actual positioning: domestic = risk-off and global = rotation.? Again, there is a good chance of a short-term rebound, but taking everything into account - at some point we will be switching from a bull market correction to a bear market rally. ?DO NOT ‘buy-the-dip’ unless you’re nimble and brave; otherwise, buy-more-popcorn and enjoy the show.

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HODL’s: (Hold-On for Dear Life)

-????? (+) PUBLIC.com Bond Portfolio (6.9% yield)

-????? (+) IBIT – Blackrock’s Spot Bitcoin ETF ($49.5 / in at $24)

-????? (+) Physical Commodities = Gold @ $2,917/oz. & Silver @ $32.9/oz.

-????? Bitcoin (BTC = $86,000 / in at $4,310)

-????? Ethereum (ETH = 2,200 / in at $310)

-????? ETHA – Blackrock’s Spot Ethereum ETF ($16.3 / in at $20)

-????? (+) GLD – Gold ETF ($268 / in at $212)

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Options for Income: **IBIT

-????? BUY the IBIT ETF: Bi-Weekly

-????? BUY PUTs: 1 Std. Dev. Lower, Expiring = 3-weeks away, OTM (out-of-the-money) for protection.

-????? SELL Covered CALLs: 0.75 Std. Dev. Higher, Expiring = 2-weeks away, OTM for income and to finance the PUTs.

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Crypto Alts:

-????? (-) Aave (AAVE = $193 / in at $155)

-????? (-) ChainLink (LINK = $15.4 / in at $11.15)

-????? (-) Doge (DOGE = $0.19 / in at $0.22)

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‘De-Gen’ Economy:

-????? Apple (AAPL = $239 / in at $220)

-????? Robinhood (HOOD = $44.4 / in at $42)

-????? (+) Singapore (SE = $135.7 / in at $107)

-????? (+) Philip Morris (PM = $150 / in at $131)

-????? (+) CME Exchange (CME = $254.5 / in at $238)

-????? (+) CBOE Exchange (CBOE = $213 / in at $197)

Please be safe out there!

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