Vincent Deluard, Global Macro Director at StoneX, has issued a warning regarding the sustainability of current equity valuations, specifically pointing to the limitations of artificial intelligence capital expenditure. He argues that while markets may remain resilient through the upcoming midterms and the anticipated Anthropic IPO, the trend of doubling AI capex cannot continue indefinitely. Consequently, Deluard plans to shift his outlook to bearish on stocks after November.
In contrast to his cautious view on equities, Deluard remains bullish on Bitcoin and gold, identifying them as superior hedges against long-term dollar debasement. His analysis highlights breaking points in Treasury yields, oil prices, and the yen carry trade, suggesting these macroeconomic stressors could trigger broader market instability. The strategist also references France’s bond market crisis and potential Eurozone contagion risks as factors influencing global financial conditions.
Deluard’s divergence between equities and hard assets underscores a growing institutional skepticism toward the valuation models underpinning the AI-driven market rally. By pinpointing November as a critical inflection point tied to political events and specific corporate listings like the Anthropic IPO, he suggests that current liquidity conditions are masking structural vulnerabilities in both US fiscal policy and global debt markets. This perspective aligns with a broader narrative where traditional growth engines are viewed as overextended relative to their capacity to service rising costs and interest rates.
The continued bullishness on Bitcoin amidst warnings about Treasury yields and currency debasement reflects an evolving institutional framework that increasingly treats digital assets as a hedge against monetary policy failures rather than purely speculative instruments. As attention shifts to the sustainability of AI capital expenditures and the fragility of the yen carry trade, the market structure may see a reallocation of risk away from high-beta equities toward assets perceived as having stronger defensive characteristics against inflationary pressures and sovereign debt concerns.
