Oct 23, 2026 · 1h 1m
Deluard warns index highs conceal a weakening market
StoneX' Vincent Deluard: The S&P Is Hiding a Bear Market | #655
The episode tests whether strong U.S. index performance can survive deteriorating breadth, higher yields, and renewed inflation risks.
- 1Deteriorating breadth and a divided economy are making record U.S. indexes look stronger than the broader market.
- 2Rising yields and possible inflation shocks could challenge the equity assumptions that supported years of optimism.
- 3Deluard sees opportunities beyond U.S. stocks, including Asian currencies, Japan, the UK, and Latin American markets.
Don't miss
Vincent Deluard explains why strong gold and crypto performance alongside rising real yields may signal expectations of future inflation or unconventional policy.
The brief
Vincent Deluard argues that record U.S. index highs conceal deteriorating breadth, while technology wealth masks struggling local economies and a divided recovery.
After years of favoring equities and high nominal growth, Deluard turns cautious as rising yields, seasonal weakness, and midterm-election risk threaten a market reversal.
The next inflation shock may come through agriculture, diesel, food, tariffs, or policy responses—even as oil prices remain lower than expected.
Deluard compares Europe with post-crisis Japan, then looks abroad for opportunity in Asian currencies, Japan, the UK, and Latin American equities.
The standout tension is between rising real yields and strong gold and crypto performance, which Deluard reads as a warning about future inflation or unconventional policy.
What was said on this episode
31 statements · 9 positive · 19 negative · 1 mixed · 2 neutral
Over 70% of U.S. stocks trade below their 200-day moving average.
“More than 70% of U.S. stocks are trading below the 200-day moving average.”
Listen at 1:28
U.S. index support may not continue much longer.
“we may not be able to keep that for much longer.”
Listen at 2:28
Vincent is becoming bearish on stocks.
“I'm turning bearish on socks.”
Listen at 6:30
Vincent would reverse his equity and duration positioning.
“I would flip.”
Listen at 6:51
Higher yields are becoming a problem for stocks.
“we are starting to see attractive level of yields that I think are becoming a problem for the stock market.”
Listen at 6:53
Current consumption supported by asset withdrawals cannot continue.
“this can't last.”
Listen at 9:10
The bull market’s justification has become circular and self-referential.
“Eventually, the sole justification for the bull market is the bull market itself. It's a very circular argument.”
Listen at 9:15
A major Democratic sweep is expected in the midterm elections.
“That would be my expectation.”
Listen at 11:21
No meaningful Fed or fiscal support is expected over the next two years.
“I don't see any of these puts in the next two years.”
Listen at 13:35
The global economy effectively faces oil prices of $150–$200 per barrel.
“effectively, we are living in $150 to $200 oil world.”
Listen at 16:08
Chinese producer-price inflation is running around 5–6%.
“now ppi is running at five six percent”
Listen at 16:37
The next economic shock will produce inflation through the policy response.
“I don't know what the next shock will be, but I know it will be inflationary because the policy reaction will be inflationary.”
Listen at 17:10
Agriculture poses the greatest risk for the next inflation shock.
“I would be most worried about the ag part of the equation”
Listen at 18:39
Normal stock correlations would imply a VIX near 40.
“The VIX would be around 40, if that were the case.”
Listen at 24:27
The dominant AI investment narrative is losing strength.
“The main narrative is getting tired, this kind of AI story.”
Listen at 25:53
Europe currently resembles Japan’s 2011–12 condition, but worse.
“Europe today is where Japan was in 2011-12, just uglier.”
Listen at 26:58
A weaker euro would restore European growth.
“Weaker euro will work.”
Listen at 31:33
Europe’s currency weakening will occur through successive crises.
“it's just going to happen in a nasty way through a sequence of crisis.”
Listen at 34:03
The euro may fall substantially, potentially to 0.8 or 0.6.
“the euro much, much weaker, maybe 0.8, 0.6.”
Listen at 34:22
Asian currencies are attractive investments.
“I like the Asian currencies.”
Listen at 35:41
Japan is emerging from its debt crisis.
“I think Japan is going out of the debt crisis.”
Listen at 35:43
The Japanese yen is an attractive position.
“The Japanese yen would be one that I like.”
Listen at 36:23
The Bank of Korea will need to raise interest rates.
“My expectation is that the Bank of Korea will have to raise rates”
Listen at 38:40
Vincent is becoming bullish on bonds.
“i'm kind of turning bullish on bonds”
Listen at 40:10
Attractive international investment opportunities will emerge over time.
“I do think that over time, great investment opportunities will emerge.”
Listen at 40:56
Capital should eventually be deployed into discounted French luxury stocks.
“I wouldn't rush to trade, but that would be how I would deploy capital.”
Listen at 42:58
The United Kingdom would benefit relative to Europe from the eurozone debt crisis.
“The UK would benefit, relatively speaking, from the eurozone debt crisis.”
Listen at 43:54
A long-UK, short-Eurozone equity pair trade could work.
“I could see the UK on a pair trade. You know, you would be kind of short Eurozone equities and then you'd be long UK against it.”
Listen at 45:43
Markets may expect unconventional inflation measurement or policy developments.
“the market is thinking there's going to be some goofy stuff with inflation.”
Listen at 51:05
France currently meets all major markers of a severe sovereign debt crisis.
“Perfect hit for France. We hit every single marker of a severe debt crisis.”
Listen at 57:12
France’s current debt situation is very serious.
“this is bad. This is very serious.”
Listen at 58:22
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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