Zeberg argues the US economy has been hollowed out for over a year, with revised payrolls showing only 16,000 jobs per month from April 2025 through March 2026, and that only an AI investment boom adding 1-2% to GDP has delayed a recession that his business cycle model flagged structurally in July. He insists there is no bond crisis and that yields will plummet as labor weakens, expects a final blow-off top in the NASDAQ (39,000-41,000) and a stock market peak potentially by November to January, and calls this a late-cycle setup like 2007 with a consumer weaker than in 1929. He expects a deflationary bust first, then Fed stimulus and a stagflationary phase later, with gold pulling back toward $3,100 before a long-term run to $27,000-29,000 by 2030, and Bitcoin in a bear market.
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Labor market and recession signal: Revised payrolls average 16,000 jobs per month, and the first print of 162,000 had a record-low 44% survey response rate. His model gave a structural recession signal in July, which has led recessions by 1-3 months across eight recessions with no false signals, and he says the median US consumer cannot cover a $2,000 bill with a 3% savings rate.
Bond yields will plummet: He rejects Luke Gromen’s “bond singularity” view and the bond vigilante narrative, noting high-yield credit spreads are not dangerously wide and yields always spike late cycle (as in 2007) before following the labor market down. He is watching short-duration yields, the S&P-to-bonds ratio, and low-quality credit spreads as the trigger, expecting yields to fall sharply.
Fed and stagflation: He says the Fed’s 0.25% hike on September 12 under Warsh is “playing with fire,” comparing it to hiking into the bubbles of 1929 and 2000, and that the real risk lies in opaque private credit and private equity. He argues stagflation can’t occur during a bust because inflation falls in recessions (his comparison: a 3% savings rate now versus up to 20% in the 1970s), and stagflation would come after Fed stimulus.
Dollar, NASDAQ, and gold: He expects the DXY to dip to 93-94 first, fueling a final risk-on push (NASDAQ 37,000-39,000, possibly 41,000, S&P 8,500-9,000), then a dollar rally toward 120 as the bubble pops. Gold, he says, could correct toward $3,100 (he admits he was wrong about how high it could run) before a Fed-driven takeoff, and the gold-to-S&P ratio is turning in gold’s favor as in 1929, 1971 and 2000.
Bitcoin and altcoins: He thinks Bitcoin topped in the fall of 2025 and entered a bear market, with a bounce to roughly $115,000 before it needs to prove it can hold above $10,000 in the deflationary bust. Ethereum and altcoins should outperform Bitcoin near term (Ethereum $7,200-7,400, altcoin market cap around $2 trillion), but he rejects the idea of Bitcoin as a reserve currency.
