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Peter Grandich: latest market views
Peter Grandich & Company
Summary
Peter Grandich is a veteran Wall Street market strategist with over 40 years in the business, author of 'Confessions of a Former Wall Street Whiz Kid' and publisher of The Grandich Letter blog, who now works in retirement, business and estate planning in Wall, NJ.
Chorus has 36 views from Peter Grandich across 2 episodes on The David Lin Report since October 26, 2026.
What they talk about most
- Market sentiment, positioning & volatility · 4
- Oil & fuels · 4
- US stock market outlook · 4
- AI bubble & tech valuations · 3
- Gold & precious metals · 3
- Agriculture & food commodities · 2
- Copper & industrial metals · 2
- Credit markets · 2
- Middle East & Iran · 2
- US consumer · 2
- US elections & politics · 2
- US growth & recession risk · 2
The latest views
Newest first. Every quote is checked against the episode's transcript.
A significant US market decline is coming, possibly the worst ever, and it must start by late November.
Grandich argues the market has been going sideways to down through the summer, with only a shrinking group of S&P 500 stocks carrying it. Several hundred S&P 500 stocks are already 20% or more below their highs, which he says qualifies as a bear market, and there are more new lows than new highs. He sees the market as at least facing a significant correction, possibly a bear market, depending on whether passive flows keep coming. He says that if the decline is to happen before the holiday period, it needs to show up by the end of November, otherwise it likely waits until January.
“You're gonna have the worst decline ever, maybe even worse than nineteen twenty ninth.”at 0:06
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Oil will stay elevated because the Middle East conflict is causing more damage than officially acknowledged.
Grandich argues the Iran war was supposed to be won months ago but is now about eight or nine months in, with oil making near-new highs since it started. He says the opposing side is inflicting more damage than the self-declared victor, which keeps oil elevated. He doubts reports that Hormuz throughput is back to prewar levels, because the US is still drawing heavily on the Strategic Petroleum Reserve, a drawdown that cannot be sustained much longer and may become physically hard. He says oil at $115 to $120 shows there are problems regardless of official messaging.
“there's more damage being done from the opposing side than the so called victory side. And so I think that's part of the reason why oil is elevated and will stay elevated.”at 3:05
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
The AI bubble is unraveling and is a major driver of the stock market decline, alongside the Middle East and midterms.
Grandich says the unraveling of the AI bubble matters as much to the current stock decline as the Middle East crisis. He argues investors have concluded AI is not the win-all for everything, and that the technology sector is finally breaking down. He says tech had been carrying a narrowing market, so without it the market would be down a lot. He expects historians to call this the biggest bubble ever on Wall Street, a single asset passed around on promises that everyone would benefit. He also points to big technology companies whose free cash flow has swung negative as they spend heavily on AI, and says mega-cap companies treated like countries are a mistake.
“I also believe as important as the Middle East is to the stock market right now decline, so is the unraveling of this enormous AI bubble.”at 4:51
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
A Democratic House or Senate sweep means legislative standstill, which is worse for small business and may push Trump out.
Grandich says he's seen no legislation benefiting small business owners in decades, with policy favouring big technology companies and large corporations. He cites clients who are nearly half small business owners, facing rising costs, regulation and legal issues. He expects the midterms to be more negative for them, with more of a standstill in Washington. He also gives a personal opinion that if Democrats take both chambers, Trump won't finish his term because of infighting and revenge politics, and he expects Trump to leave with pardons.
“I think the election can only be more negative for them and more of a standstill in Washington”at 7:33
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
The administration may launch new military action soon after the election, before the new Congress takes office.
Grandich argues that Democrats would not fund a continuing large-scale war under a Trump administration, and that the new House and Senate take office in early January. He thinks that is why the administration may be preparing to act before then, possibly fitting a war into the six or seven weeks after the election. He presents this as a plausible explanation rather than a certainty.
“And that could be why they're gonna try to fit a war into six or seven weeks soon after the election.”at 11:39
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Energy stocks can still perform well but are not undervalued after their run.
Grandich says he is not bullish on the broad equity market. He says energy stocks can still perform well, but he sees no undervaluation in them. He suggests anyone who has not yet participated is probably in a late stage of the trade. He ties this to the oil price, which he expects to stay elevated.
“I'm not bullish at all on the general equity market. [...] They can still perform well, but I don't see any undervalue in this there.”at 12:14
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Agriculture & food commodities
Middle East fertilizer disruption will cause global food shortages in 2027.
Grandich says the Middle East crisis is under-discussed in its effects on food. Fertilizer supply was disrupted, so farmers could not do normal planting, growing and animal feeding in some areas. He expects these effects to show up in 2027, with certain regions facing dramatic food shortages. He also flags diesel as a bigger worry than gasoline, since US goods move by trucking and diesel is trucking's largest single cost.
“I believe we're gonna see more of the effect [...] in 2027. And that is how this coming food shortage that's gonna be in the world because of the lack of fertilization”at 13:27
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Market sentiment, positioning & volatility
Hedge funds have turned very short while the public buys tech funds, a bearish divergence.
Grandich says hedge funds have become very short while the general public has aggressively moved into technology funds in recent weeks, so professionals are leaving while retail money comes in. He reads this as a sign the market is anticipating at least a significant correction. He argues that once the market stops rising, the key question is whether passive investment flows slow, dry up or turn negative. He calls passive flows the last support for the bulls and the factor that will decide between a simple correction and a bear market.
“we've seen hedge funds become very short. This was happening by the way, while the public in the last couple of weeks aggressively went into technology funds.”at 17:20
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Gold mining stocks have record free cash flow but are not attracting money the way tech stocks did.
Grandich contrasts the mining industry, which had years of negative cash flow and now posts record free cash flow, with big technology companies whose free cash flow turned negative over the last couple of years. Despite the mining cash flow, he says no one stampedes into miners the way they did into technology. He says that is why he expects to be fully invested in mining stocks again by the end of the day.
“the mining industry that for many years had a lot of negative cash flow now has record free cash flow, but no one stampedes into them the way that they stampeded into the technologies.”at 21:30
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Gold has technical damage and needs a base near $4,000 before a major move up, with downside to $3,400-3,500 risked.
Grandich says the paper gold market has been played to the downside since late August, breaking key technical supports. Gold has made two lower highs after a strong run while still supported near $4,000. He says a rally would need to retake the prior high near $4,800 to avoid breaking $4,000 and falling to support around $3,400-3,500, which he doesn't see as the likely outcome. He needs a base of at least a few weeks at $4,000 before people trust the level, though he notes gold is entering a seasonally stronger period. He says he is committing virtually all his investment capital to gold now, betting it won't fall much below $4,000.
“Listen, I'm committing virtually all my investment capital to this area now. So I'm obviously betting it's not gonna go much below 4,000”at 26:47
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
The 10-year Treasury yield will rise to 5.5% to 6% in 2027.
Grandich says rates are going up, not mainly because of inflation or the war, but because the world is recognising it is becoming harder for the US to borrow more than it takes in. He argues that lenders will need a higher yield to keep providing money as the US struggles to make interest payments on time. He says foreign investors have been selling heavily, and that US hedge funds using leverage to buy Treasuries are the reason yields are not higher. His 2027 yield call is for 5.5% to 6%, and he admits his fixed income team disagrees on bonds.
“And that's why I still believe that we will see a 5.5, six percent ten year in 2027.”at 29:09
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Low-end corporate bonds, including AI neocloud borrowers, are weakening and may recover only 10-30 cents on the dollar.
Grandich says the low end of the corporate bond market is becoming terribly weak. When yields reach levels like those seen at neocloud borrowers, there is a big question whether issuers can keep paying interest, let alone principal, and more issuers fit that profile. He is very concerned about these groups, which could miss interest payments and return only about 10 to 30 cents on the dollar. Institutions have bought insurance-like products to hedge the risk.
“the corporate bonds are a completely different story. [...] I'm very concerned about the groups that you spoke about. [...] there'd be maybe ten, twenty, thirty cents on the dollar return back”at 29:17
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
China's bond yields have fallen sharply as investors view Chinese debt as safer than US Treasuries.
Grandich says that even though China's stock market has come down, its bond yields have dropped dramatically. He says this means China's cost of money is cheaper than it has been in many years. He attributes it to people feeling safer putting money in China than in US Treasuries. He adds that the world now has more competition for capital than it did when US rates were very low, and that bond yields around the world are more comparable now.
“China, even though their stock market has come down, their yields have dropped dramatically. Their cost of money is cheaper now than for a lot, a lot of years for them and all. And that's because people are feeling actually safer to put money there than in the US treasury.”at 29:57
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
US debt of $40 trillion and $2-3 trillion deficits are heading toward a reckoning, with interest payments becoming a problem within years.
Grandich argues the US has $40 trillion of debt and still runs $2 to $3 trillion yearly deficits. He says the country is only a few years from when paying interest becomes a real challenge. He describes decades of fiscal mismanagement coming due, because the US cannot keep borrowing and make timely interest payments. He cites foreign sellers as evidence that the world already recognises this, and he uses it to argue against locking money into long-term bonds.
“$40,000,000,000,000 in debt and we're still running 2 to $3,000,000,000,000 yearly deficits. We're only a few years away now to where paying the interest is gonna becoming a real challenge.”at 32:58
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
The US is worse off than in 1987, 2000 or 2008 and lacks the capacity to fix the next crisis.
Grandich, who says he sidestepped the 1987, 2000 and 2008 declines, argues that the US could previously act to eradicate the cause of a crisis, but no longer can. He says the country can no longer create trillions of dollars on demand as it did during COVID. If the US needed another $5 trillion, he believes markets would conclude the country cannot repay principal and would struggle to pay interest. He judges the economy, society and politics as much worse off than in those three periods.
“What's different now is I think we're worse off than any of those three periods. And the reason is the country, at least The US was in a position to do something to eradicate whatever that crisis was caused by. I don't believe we are that anymore.”at 36:22
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Market sentiment, positioning & volatility
Circuit breakers won't stop large market drops; the total damage over days ends up similar.
Grandich responds to David Lin's point that circuit breakers prevent a one-day crash like 1987. He argues the 1987 crash was driven by a new system for routing small orders into the market, which amplified momentum, and that circuit breakers will not stop the market from falling 20% over five days or twenty. In his view, whether losses come in one day or ten makes little difference, since after those ten days the outcome is largely the same.
“I don't think it's gonna stop it from a market being down 20% in five days or twenty... after those ten days, whether it was one or ten, we're pretty well gonna be in the same boat.”at 37:49
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Passive-fund inflows are propping up stocks; if they reverse, the decline could exceed 1929.
Grandich says the buy-the-dip mindow that advisors preach works only because passive investing keeps money flowing into the market, which is why two-thirds of advisors have never seen a bear market. He warns that once passive flows turn into outflows, the result could be the worst decline ever, perhaps worse than 1929. He adds that buying everything would fail then, because the economy, society and politics are in worse shape than at any point in US history. He stresses he is not saying this is happening.
“And the day passive investing flips and it's no longer certainty money flows in, but money starts coming out of passive investments, you're gonna have the worst decline ever, maybe even worse than 1929.”at 40:37
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Copper supply is structurally short, so the metal should keep rising over time even without AI demand.
Grandich argues copper's demand case holds even if AI infrastructure spending slows, because normal global growth alone requires six tier-one copper projects to come online between now and 2050. Only six such projects have come online since 2020, so the supply-demand imbalance is severe. He concedes there will be corrective phases, but he expects copper to keep working higher over time.
“Without AI, just normal expectation of growth in the world, we need six tier one copper projects to come online between now and 2050 in order to meet the expectation of normal growth. Right now, we've only had six since the year 2020.”at 41:27
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Most US households spend beyond their means, a structural problem that will cause economic trouble.
Grandich says that across a wide spread of Americans, from professionals to athletes, seven out of ten families live at least one lifestyle above their finances, which is only sustainable by spending more than they earn. He links this to the economy by arguing that until Americans spend less than they make, the US will keep facing problems, regardless of how bad people say the country is.
“Seven out of 10 families... they live at least one lifestyle above their finances. And the only way you can do that is you're spending more than you make.”at 44:18
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Market sentiment, positioning & volatility
Short holding periods, now about six months versus 8.5 years in 1980, add volatility and emotional trading.
Grandich cites a statistic that the average stock was held 8.5 years in 1980 but only about six months at the end of 2025. He argues investors are no longer long-term holders. Shorter holding horizons produce more volatility and push people toward emotional rather than fundamentals-based decisions.
“In 1980, the average stock was held eight point five years. ... At the end of 2025, the average hold was six months.”at 45:38
The David Lin Report: China's Tech Stocks Crash 40%: Is Wall Street Next? | David Woo ·
Oil will stay elevated because the Iran conflict is unresolved and not won, despite reports of normal flows.
Grandich says oil is elevated and will stay that way. The war, now about eight or nine months old, was supposed to be won months ago, yet oil is making near-new highs since the conflict began, with Brent around $115 to $120. He argues more damage is being done by the opposing side than by the supposed victor. He is skeptical of reports that Strait of Hormuz throughput is back to prewar levels: the US keeps drawing down its strategic petroleum reserve, which he says doesn't make sense if oil flows had normalised and which he says cannot be sustained much longer. He also flags diesel as more important than gasoline, because trucking is the main way goods move in the US and diesel is trucking's biggest cost.
“And so I think that's part of the reason why oil is elevated and will stay elevated.”at 3:11
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Unravelling of the AI bubble is as important a driver of the stock decline as the Middle East.
Grandich argues the AI bubble's unravelling is as important to the current stock decline as the Middle East crisis. He expects historians to call it the biggest bubble ever on Wall Street, built on one kind of asset passed around with many claiming everyone will benefit. He believes investors have concluded AI is not a win-all for every company, and that technology is finally breaking down stocks. He points to big technology companies whose free cash flow has turned negative over the last couple of years, and says that without technology the market would be down a lot, since tech has carried breadth. Its rollover is why he sees a significant correction coming.
“I also believe as important as the Middle East is to the stock market right now decline, so is the unraveling of this enormous AI bubble.”at 4:51
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
A Democratic sweep would stall Washington and could push Trump out early; gridlock is bad for small business.
Grandich calls the midterms the most important election since he has been in the business. If Democrats capture the House and Senate, he says he personally believes Trump will not finish his term, citing infighting, revenge threats from Democrats at every level, and Trump's intolerance of criticism; he expects Trump to leave as Biden did, with pardons. He also believes Democrats would stop funding large-scale war under Trump, which is why Trump may act before January. He says small businesses, roughly half his firm's clients, have seen legislation favour large corporations and big tech for decades, so the election can only be more negative for them, with more standstill in Washington. He flags this as opinion, not gospel.
“If for some reason they also capture the senate, it's my personal opinion, it's just a thought. It's not gospel. I believe Trump won't finish out his administration.”at 9:27
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Energy stocks can still perform but are no longer undervalued after his recent buying.
Grandich says he started buying energy stocks several weeks ago and that they can still perform well, but he does not see any undervaluation there. He suggests that if investors have not participated by now, they may be late, since the group has already moved.
“They can still perform well, but I don't see any undervalue in this there.”at 12:14
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Agriculture & food commodities
Fertiliser shortages from the Middle East crisis will cause food shortages in some regions in 2027.
Grandich believes the effects of the Middle East crisis will show up more in 2027 through a coming world food shortage. The Gulf disruption reduced fertiliser supply, so farmers could not do normal planting, growing and feeding of animals. He expects some areas of the world to see dramatic food shortages. He sees this as under-discussed relative to its importance.
“And that is how this coming food shortage that's gonna be in the world because of the lack of fertilization that was able to get out and do the typical planting and growing.”at 13:41
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
The Middle East situation is much worse than the administration has admitted; the Iran conflict is a quagmire.
Grandich argues the Middle East situation is far worse than the current administration has let on for many months. The group that was supposed to be annihilated still has the capacity to cause harm, and more damage is being done by the opposing side than by the supposed victor. He says this could end up being one of the biggest quagmires in US history. He thinks the administration has massaged things to keep stocks up. He also suggests Trump may try to fit military action in before a Democratic Congress takes office in January, since Democrats would be unlikely to fund a continuing large-scale war while Trump is in charge.
“So the Middle East situation is a lot worse than we've been led to believe by this current administration for many months.”at 13:47
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Expects at least a significant correction, possibly a bear market, with breadth and passive flows the key risk.
Grandich says the market is anticipating at least a significant correction. Hedge funds have become very short while the public has aggressively moved into technology funds. Several hundred S&P 500 stocks are already down 20% or more from their highs, which qualifies as a bear market for them, and new lows outnumber new highs. He says the market has run out of steam since Labor Day and could see significant declines. The key question is whether passive investment flows slow, dry up or turn negative; if they do, a simple correction could become a bear market. He says that if a serious correction is coming, it needs to show itself by the end of November, otherwise it likely begins in January. He also says the worst decline ever, possibly worse than 1929, is coming.
“Well, market is anticipating at least a significant correction. Think at the very minimum, we've seen hedge funds become very short.”at 17:11
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Gold and silver have technical damage that needs repair; expects a base near $4,000 before a major move up.
Grandich says gold has broken key technical supports since late August and has made two lower highs while still holding around $4,000. A previous high near $4,800 would need to be taken out to avoid a retest of $4,000, and a break below could bring the next support near $3,400 to $3,500. He says that is not his primary case, but the bears' argument is legitimate. He expects a base of at least a few weeks at $4,000 before people believe that level is supportive. He notes the season is turning from weak to stronger for gold.
“And the technical aspect now is gold and silver even more so has seen technical damage that needs to be repaired before we can expect a major move back up.”at 26:57
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Expects the 10-year Treasury yield to reach 5.5-6% in 2027 as the US struggles to fund its deficits.
Grandich believes rates are going up, not mainly because of inflation or war, but because the US is finding it harder to keep borrowing more than it takes in and will eventually struggle to make interest payments on time. Lenders will therefore demand higher yields. He cites $40 trillion of debt and $2 to $3 trillion of annual deficits, and says foreign ownership has been selling heavily. Competition for capital has also grown: China's yields have dropped to cheap levels, so investors feel safer there than in Treasuries. Hedge funds using leverage to buy Treasuries are the only reason yields are not higher.
“And that's why I still believe that we will see a 5.5, six percent ten year in 2027.”at 29:09
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
Low-end corporate bonds are very weak; distressed issuers may recover only 10-30 cents on the dollar.
Grandich says the low end of the corporate bond market is becoming terribly weak. At yields of 15 to 16%, the question is whether issuers can keep paying interest, let alone repay principal, and more and more issuers fit that profile. Institutions have bought insurance-type products to hedge losses, but he is very concerned about these groups. He expects that if they default, bondholders may get back only 10 to 30 cents on the dollar, because that is all the companies can pay on their bonds.
“I'm very concerned about the groups that you spoke about... there'd be maybe ten, twenty, thirty cents on the dollar return back because that's all they can on their bonds.”at 29:22
The David Lin Report: The 'Unravelling' That Triggers Biggest Market Reset Ever | Peter Grandich ·
6 older views from Peter Grandich are on the episode pages, and all of them are a question away in your AI with Chorus.
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