Liquidation Event: How Bad Will It Get? | Mike McGlone

Bitcoin

Across the shows: 27 speakers in other episodes, 22 bullish and 10 bearish calls, past 30 days

• Mike McGlone · Bloomberg IntelligenceBearish

  Bitcoin is in a bear market, still has room to fall, and could drop to $10,000.

  McGlone's long-running view is that Bitcoin is his best leading indicator. He was bullish until it passed $100,000 in 2025, when he said it would drop a zero to $10,000 and has not rescinded that. Bitcoin peaked on October 6, 2025, fell in both 2025 and 2026, and has been in a bear market since its bounce. It is now around $75,000, and he says it has a lot of room to go lower. Bitcoin lost 2025 and 2026 while the Nasdaq rose, and he reads its weakness as the first casualty, with the Nasdaq to follow.

  “when I got above a 100,000, I said it's gonna drop a zero, go back to 10,000. I still haven't rescinded that”at 5:14

Intel

Across the shows: 16 speakers in other episodes, 5 bullish and 14 bearish calls, past 30 days

• Mike McGlone · Bloomberg IntelligenceBearish

  Intel has become too expensive, and its sharp fall is mean reversion to a more reasonable level.

  After David Lin says Intel's roughly 62% fall from its summer peak is a return to its mean, McGlone agrees. He says Intel was a great stock until the early 2000s and 2008, and that Intel has since been replaced by many newer companies in the S&P 500. He describes rapidly advancing technology and market rotation, with money moving from momentum to low volatility. In his view the stock had become too expensive, so the decline is a normal reversion in a classic case of hubris.

  “Yeah. So I don't disagree with it. Gotten way too expensive.”at 21:32

Gold & precious metals

• Mike McGlone · Bloomberg Intelligence

  Treasuries, not gold, are the safety play; gold is near a four-decade high versus Treasuries.

  Asked whether gold is still the safety play after its selloff, McGlone says no: Treasuries are. His evidence is that gold's price relative to a basket of Treasuries is the highest in about four decades. Gold has corrected from about $5,600 to about $4,000 and silver fell from $120 to about $50, which he sees as support levels, but he argues these bounces should not be relied on as safety while the cycle turns. He also says the debt-driven case for gold is weak, since gold, silver and crypto correlate more with the stock market than with the debt load.

  “It's not. It's the play for safety. Our good old US treasuries. Gold right now is the highest price versus a basket US treasuries in about four decades.”at 30:20

• Mike McGlone · Bloomberg Intelligence

  Gold and silver peaked after parabolic rallies and will range for decades, like crude oil did.

  McGlone compares gold and silver to crude oil. Crude peaked around 2000 or 2008, blew off, and then spent about twenty years in a range. Gold and silver had the most parabolic rallies in history and peaked in Q1 in a disinflationary environment. Gold and silver velocity rallies were last matched in 1980, when CPI was about 15%, and a long disinflationary period followed. He expects these metals to find support near $4,000 gold and $50 silver but to stay in long ranges that frustrate buyers for years.

  “Gold and silver had the most parabolic rallies in history, and they peaked in q one in a disinflation environment.”at 32:23

Oil & fuels

• Mike McGlone · Bloomberg Intelligence

  Crude oil will fall to about $50 by a year from now as supply surpluses build.

  McGlone says WTI, at about $90, has never closed above $100 and is roughly where it was about twenty years ago. US and Canadian crude surpluses are approaching 9 million barrels a day, versus about 4 to 5 million at the 2022 peak. He argues the energy price spike was not structural: a Middle East war and central-bank hikes triggered it, and it will prove temporary. He adds that the Iran conflict accelerated trends already in place, including the Western Hemisphere becoming the marginal price setter, technology replacing fossil fuels, and Volkswagen cutting jobs. He calls energy a cycle that has been in a bear market for twenty years.

  “Well, oil will come down. My view is by this time next year, we're gonna be talking about $50”at 10:51

US rates & the Fed

• Mike McGlone · Bloomberg Intelligence

  Equity declines will tighten financial conditions, so the Fed's next moves will be 50bp cuts.

  McGlone says don't fight the Fed, but he argues the Fed is about to reverse. Futures price roughly three-quarters odds of a December hike and about 1.9 hikes over the next year, down from three. The bond market has already tightened, with 30-year mortgage rates at a three-decade high. He expects a further stock-market decline to do the remaining tightening, after which the Fed would move to a series of 50-basis-point cuts. He also argues that the Fed is fighting a wealth-driven and energy-driven inflation that falling stocks would fix.

  “if the stock market can just do some more of the tightening form, the next moves from the Fed will be a series of 50 basis points cut.”at 13:40

US stock market outlook

• Mike McGlone · Bloomberg Intelligence

  Stock market is in an early cascade; a 20% drawdown is virtually unavoidable in coming years.

  McGlone calls the recent selloff 'sissy stuff' and says the real cascade has not started. He points to stock market capitalization of about $81 to $83 trillion, which has likely peaked, and to stock market capitalization relative to GDP at a 100-year high. Stock market capitalization relative to debt is at its highest since 2001 on a year-end basis. He says the Nasdaq peaked on October 6, 2026, and that a 20% stock correction corresponds to a 50% fall in GDP. A 100% gain since the 2022 bottom can easily retrace 50%. He also says open interest in copper tends to peak and decline in November, so this is a liquidation year. Bitcoin's weakness is his leading indicator for the Nasdaq. He expects the drawdown to accelerate into next year.

  “Can we expect to not get through the next years without a 20% drawdown? It's virtually impossible not to have that happen.”at 15:41

AI bubble & tech valuations

• Mike McGlone · Bloomberg Intelligence

  High-flying AI and tech stocks are reverting, with a much larger correction still ahead.

  McGlone argues the first casualties of the cascade are AI and tech high-flyers. He cites AMD down about 38%, Nvidia down about 25%, Intel down about 62%, Meta down about 22%, and Google's worst single day in its history, plus CoreWeave's debt strains. He calls these moves early and says the reversion is just getting started, comparing it to his earlier bearishness on Bitcoin and gold when they became overstretched. He frames it as a psychology-driven extreme, with money managers forced to stay in the trade or risk being fired.

  “That's not even started. This is sissy stuff so far. What you're seeing there are some of the high flyers reverting. Look at them on a ten year basis.”at 18:21

US elections & politics

• Mike McGlone · Bloomberg Intelligence

  Trump's name may be judged like Herbert Hoover's if a stock-market reversion hits.

  McGlone argues Trump was elected when the stock market was the most expensive in a century on some metrics. He says a reversion would define Trump's legacy the way the Depression defined Hoover's. He says Trump is already blaming Democrats. He adds that Republicans need to move away from Trump's policies to survive, because voters are paying more for food and energy and want the inflation fixed.

  “So I've been putting his name next to Herbert Hoover and that risk of just a normal cycle.”at 19:01

US inflation

• Mike McGlone · Bloomberg Intelligence

  CPI has peaked near 4% and could turn negative within a year on deflationary forces.

  McGlone says CPI was already falling before the war and is now about 3.7%, and that it probably peaked near 4%. He compares this to 1980, when CPI peaked near 15% and a long disinflation followed. He sees deflationary forces building: technology replacing fossil fuels, Volkswagen layoffs, the US tariffs of 100% on cheap Chinese EVs, and crude's long bear market. He argues the energy and food price spike is temporary. Elsewhere he says CPI is more likely to be around zero next year, and his base case for next year's CPI is that it goes negative.

  “My focus by this time next year is we just have a normal drawdown in stock market, is that CPI is going negative.”at 20:25

US Treasuries & yields

• Mike McGlone · Bloomberg Intelligence

  A 5.15% five-year yield was the signal to shift from risk assets into fixed income.

  McGlone says the five-year Treasury yield reaching about 5.15% on October 15 was the signal to move from risk assets to fixed income. He says that would have been the highest since 1999 if it had held through year end. Almost 5% is still available on most Treasuries and the 10-year is about 4.86%, so investors can still clip coupons. He argues that a disinflationary environment makes long duration attractive again, and that a Treasury rally could follow as volatility in risk assets rises.

  “that five year note yield went around 5.15%. We're gonna look back from the future. So that was your signal that you're supposed to be getting out of risk assets and focus on fixed income.”at 22:14

Commodities (broad)

• Mike McGlone · Bloomberg Intelligence

  Commodities are very risky, with volatility near twice the S&P 500, and move like stocks.

  McGlone says gold, silver and broad commodities are risk assets with volatility roughly two times the S&P 500, and stocks are also highly volatile. He says commodity volatility is near multi-decade lows versus stocks, which is an unusual setup. He argues that when beta falls, high-correlation, high-volatility assets like commodities fall much further. Only metals made new highs this year, and the Bloomberg Energy Spot Index is about where it was in 2005. He concludes that metals are stock-market puppets rather than safe havens.

  “Gold's a risk asset. Its volatility is two times the S and P 500. Silver's a really risk asset. Commodities are very risky. Their volatility is almost two times the S and P 500”at 22:26

Copper & industrial metals

• Mike McGlone · Bloomberg Intelligence

  Copper has broken key support and trades as a stock-market proxy; US inventories are bloated and liquidation is coming.

  McGlone says copper's correlation with the S&P 500 on a 50-week basis is at its highest ever, and that copper has just broken through key support near $6.40. He calls US copper's price chart the same as the QQQ and S&P 500 charts, with copper in the position of a stock-market puppet. He cites CME copper inventories of about 800,000 metric tons, roughly 1,200% above the five-year moving average, while London and Shanghai inventories are only slightly above it. He notes open interest is peaking and typically falls in November, which he reads as a liquidation signal across markets.

  “copper has reached its highest correlation ever on a fifty week basis versus S and P 500 and it just broke through good support.”at 25:11

US housing

• Mike McGlone · Bloomberg Intelligence

  Housing has peaked; prices are expensive versus income and carrying costs erode its wealth protection.

  McGlone says housing has peaked, with mortgage rates at a three-decade high. He notes that housing reached its most expensive level versus income in history. He says a home's price gains overstate the wealth they create, because property taxes, carrying costs and maintenance eat into returns, and a home melts if not maintained. He sees better alternatives in stocks, precious metals and crypto. He also expects the short-term rental boom to fade.

  “It is. But one thing we remember about housing is it got to its most expensive versus income in history, and it's very expensive.”at 33:20