12/14/25
S&P 500: 6827
Nasdaq: 23,195
10 Year Treasury: 4.1%
David R. Snyder, CFA
Just about all of the boxes have been checked that an investor would look for to determine that the end of a secular bull market is near.
1. Near record bullish investor positioning.
2. Near record low junk bond spreads.
3. Market concentration at extreme highs.
4. Extreme Valuations by all metrics.
5. Bubbles in multiple assets (gold, housing, high yield spreads, equities, crypto).
6. Unemployment near historic lows for a sustained period.
7. High Leverage.
8. Speculative Fever.
9. Long period of time without a down credit cycle
10. Outperformance of large cap growth stocks, especially technology.
11. Poor market breadth.
12. A new revolutionary technology that captures investors enthusiasm for at least a few years.
13. Overinvestment in the near term of the new technology.
14. Low to mid-teens annualized real total returns for the S&P 500 over a 15 to 20 year period, preferably 16 to 18 years.
15. Leading Economic Indicators declining.
16. Negative output gap.
17. Divergence of free cash flow from earnings (hyperscalers).
18. Circular agreements by the leading tech companies.
19. High labor participation rates especially prime age (18 to 55).
20. Investor margin debt increasing year over year more than 500 basis points more than year over year gains in the S&P 500.
21. Historical high retail trading volume.
Now it is just a timing issue. The leverage is in government debt and in the median debt to EBIDTA of public companies (although interest coverage is still high) as well as the coming build up of debt and negative cash flow of the hyperscalers. Market breadth as measured by the cumulative advance/decline line for all exchanges has not been good over the last couple of months despite the appearance of the broadening of the stock market. Overall, it has not been great since the 2022 low but we need much worse breadth to start a secular bear market. The IPO market, which is one box that has not been checked, has not been especially exuberant. However as explained earlier, we already had our once in a generation speculative IPO market in 2020-21 and will likely not see another one of that magnitude in the near future. Another important box that has not been checked yet is rising interest rates/FED restrictive policy, although the Fed has been somewhat restrictive over the last couple of years.
Full Disclosure: I own several of the securities mentioned positively. None have been purchased within the last month. The opinions merely represent the opinion of the author as CIO of Journey 1 Advisors, LLC and intended to inform the readers about our investment philosophy and strategy. The contents of this report are based on sources believed to be reliable. It is not intended for circulation. It is not intended to offer investment advice, or to recommend the purchase or sale of any securities or investment product. Investment advice is only given after a client has signed an investment advisory agreement with Journey 1 Advisors, LLC and will be subject to the terms and conditions therein. Your decision to buy or sell a security should be based upon your personal investment objectives and should be made only after evaluating the stock’s expected performance and risk.