Disinflation (which lasted from 1981 through 1997) is bad for commodities but is good for bonds and stocks. Deflation (which started in 1998) is good for bonds and bad for commodities—but is also bad for stocks.

It’s the most extreme divergence between consumer sentiment and the stock market in over 40 years. This next version of the chart shows the same data, but it’s measured in terms of how far they are off from their highs. We have look back at the early 1980s to find a similarly low sentiment reading while stocks were near their highs: This divergence

The "Old Economy" (The Bust): Reality: Outside of AI, traditional cyclical industries are contracting. Investment in industrial equipment, residential housing, and non-residential construction is falling. The Divergence: If you strip out the AI spend, the "real" business cycle looks like a recession. High interest rates are successfully crushing