Oct 27, 2026 · 1h 8m
Deluard sees a bear market beneath resilient indexes
The Fed Put Is Dead: Why Stagflation & a Bear Market Are Next | Vincent Deluard | StoneX
The episode tests whether weakening breadth, sticky inflation, and fading policy support have ended the market regime investors relied on.
- 1Market breadth and collapsing consumer stocks suggest a bear market may be developing despite major indexes near their highs.
- 2Persistent inflation, credit deterioration, and oil-supply risks could leave the Federal Reserve unable to deliver expected rate cuts.
- 3Europe’s fiscal and political strains point toward a weaker euro reached through crisis rather than coordinated reform.
Don't miss
Deluard explains why a severe oil-supply shock could hurt stocks and bonds simultaneously, leaving energy exposure and volatility hedges among the few potential beneficiaries.
The brief
Vincent Deluard argues that a bear market may already be underway beneath resilient U.S. indexes, where weakening breadth and collapsing consumer stocks reveal deeper damage.
His central tension is stagflation: inflation remains entrenched while credit deteriorates, fiscal support fades, and the Federal Reserve has less room to cut rates.
Deluard warns that geopolitical conflict, damaged refining capacity, transport costs, and regional oil premiums could create an inflationary supply squeeze that hurts stocks and bonds together.
The conversation then turns to France and the Eurozone, where fiscal paralysis, high energy costs, and fragmented politics make a weaker euro more likely through crisis than coordination.
The standout call is tactical rather than triumphant: shift away from equities toward long-term Treasuries, while recognizing that an oil shock could challenge both sides of that trade.
What was said on this episode
30 statements · 6 positive · 22 negative · 2 mixed
Most U.S. stocks indicate that the equity bull market has ended.
“I would think so. I mean, most stocks would suggest that.”
Listen at 1:11
Long-term Treasuries should outperform stocks over six months.
“If the decision comes down to owning stocks or treasuries over the next six months, I don't think there's a question. It has to be long-term treasuries.”
Listen at 2:37
Long-term Treasuries are probably attractive over the next six months.
“So for the next six months, yeah, long-term treasuries are probably a good place to be.”
Listen at 7:07
Inflation will remain structurally around 3.5–4%.
“we are in this kind of secular inflation and probably that 3.5 4 percent a range that we are at now will uh will prevail”
Listen at 7:43
Long-term Treasury yields could reach 6–7%.
“We could very easily 6%, 7% on long-term yields.”
Listen at 8:09
Current economic growth is primarily coming from the AI investment bubble.
“Where is our growth coming from? It's the AI bubble.”
Listen at 9:02
Excluding hyperscaler CapEx, underlying economic growth is weak.
“If you take out the close to 2% of GDP that we see in hyperscale CapEx, you realize that that growth is really not that great outside of the CapEx bubble.”
Listen at 9:05
AI CapEx cannot continue doubling annually as its GDP share grows.
“the AI capex is so big now that you start running into these base effect issues. Start accounting for 3% of GDP. It's kind of hard to double every year.”
Listen at 11:17
Inflation will remain exceptionally persistent and fail to decline.
“I do expect the inflation to be extraordinarily sticky and not coming down.”
Listen at 17:45
The Fed will lower growth forecasts and reinterpret inflation favorably.
“the fed would probably uh guide a bit lower revised on the the growth forecast uh and then find some sort of creative way to dismiss inflation”
Listen at 18:09
Energy-cost increases will eventually pass through into wages.
“I would not jump to the conclusion that it's different this time, that workers do not have any power, and that this This increase in energy costs will not pass through to wages.”
Listen at 22:25
Oil prices could reach $200 per barrel.
“It's not out of the realm of possibility to see $200 oil.”
Listen at 26:11
A major oil disruption would raise both oil prices and Treasury yields.
“oil oil and yields uh would go up at the same time”
Listen at 27:27
Holding energy stocks and Treasuries together could hedge an oil shock.
“the way to hedge that is you know to be long energy stocks i think kind of a barber approach where your long energy stocks and your long treasuries at the same time would probably work well.”
Listen at 27:32
France has a roughly 5.5% GDP deficit and negligible growth.
“the deficit is, you know, around five and a half percent of GDP. The growth is non-existent.”
Listen at 31:34
France’s apparent growth is essentially inflation rather than real expansion.
“the only growth that we have is just inflation, basically”
Listen at 31:52
German rearmament hurts France’s defense sector but supports German growth.
“Germany rearming is a negative shock for France. It is positive for German growth.”
Listen at 36:51
Currency depreciation is the easiest way for Europe to restore competitiveness.
“The easiest way is to trash the currency.”
Listen at 39:31
The euro’s design is causing a major crisis that may force integration.
“The euro is doing what it should do, which is cause a giant crisis.”
Listen at 45:13
France’s tax rates are high enough that further increases reduce tax revenue.
“France is probably on the wrong side of the Laffer curve where we tax so much that raising the tax rate actually diminishes the tax revenues.”
Listen at 48:07
Lagarde’s successor is unlikely to match Draghi’s crisis leadership.
“I don't think we're going to see that with her successor”
Listen at 51:48
Governing Brazil is substantially harder than winning its election.
“winning the election is easy. The easy part, governing is the hard part.”
Listen at 55:05
Brazil’s energy profile is improving due to rising oil production.
“Brazil on the margin improves its energy. profile”
Listen at 57:25
The political left remains electorally viable globally.
“The other lesson that I would take is the left is not dead.”
Listen at 58:46
Markets are entering a period without reliable Federal Reserve or fiscal support.
“for the first time since 08 we're going to enter a period without either fed put or a fiscal put”
Listen at 1:00:27
Neither monetary nor fiscal backstops will be available over two years.
“In the next two years, I don't really see any of these puts.”
Listen at 1:01:07
Equities will be lower in six to twelve months.
“if you ask me in six, 12 months, I think equities are lower. Yes.”
Listen at 1:03:29
Europe will achieve currency adjustment through chaos and repeated crises.
“Europe is going to do. with chaos and repeated crisis.”
Listen at 1:04:00
A weaker euro against Asian currencies is the appropriate solution.
“the solution really is weaker euros from Asian currency.”
Listen at 1:04:57
France could eventually leave the euro as part of its solution.
“it could be that that would be some sort of a, yes, walking out of the euro. That could be part of the solution for France.”
Listen at 1:07:27
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.
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