Ed Yardeni has suddenly donned his skeptic’s monocle. With the S&P 500 up a dizzying 37% in six months, Yardeni frets that the bull parade has grown so rowdy it might just trample its own parade route by December.
Yardeni, the perma-bull behind Yardeni Research, built his reputation on unshakeable faith in upward trajectories. Yet after investors thumbed their noses at Federal Reserve Chair Jerome Powell’s rate-cut side-eye, even he admits the vibe feels a tad too festive—like a backyard barbecue where everyone’s brought kale smoothies instead of beer.
The S&P 500’s sprint defies history’s rulebook, matching just five other adrenaline-fueled runs since 1950. November, that perennial holiday tease with its average gains over three decades, now looms like a mischievous uncle promising candy but delivering fruitcake.
Yardeni eyes a possible 5% dip from the peak by year-end, blaming “stretched” sentiment and technicals that scream “pull over” louder than a cop at a tailgate. “One rogue snowball fight could send stocks sledding downhill,” he mused over the phone, his voice a mix of economist gravitas and reluctant party pooper.
Market breadth? It’s narrower than a hipster’s jeans, with gains propped up by a few mega-caps while the rest of the herd grazes nervously. Investors Intelligence’s bull-to-bear ratio hit 4.27 last week, crossing the “everyone’s invited, even the bears” threshold that historically precedes a collective sigh.
Retail investors have been bullish above their 37.5% norm for five of seven weeks—like overeager Black Friday shoppers lining up at dawn for socks. Yardeni’s own 2025 S&P target of 7,000 still gleams optimistically, just 2.3% above Friday’s close, outshining most strategists’ crystal balls.
But oh, the technicals: S&P trades 13% above its 200-day moving average, a gap wider than the enthusiasm at a free-sample station. Nasdaq 100? A whopping 17% over its support, echoing the pre-August yen-carry fiasco when markets hiccuped like a cat on caffeine.
Enter Tom Lee of Fundstrat Global Advisors, the rally’s unflappable uncle who scoops up dips like they’re discounted Halloween candy. “November’s historically bullish—think turkey and touchdowns,” Lee quipped in a client note, dubbing this “the most hated rally” since that one family reunion where Aunt Edna brought tofu turkey.
The S&P’s 16% 2025 climb so far bodes well, with data from the 1920s showing a median 4.2% November-December pop when the year’s first 10 months deliver 10% gains. The sour note? 1938’s 3.8% flop, when the market apparently decided breadlines needed no stock market garnish.
Stakes spike as traders wager on Fed doves cooing softer than signaled. This week’s Fed chatter from John Williams, Chris Waller, and Michelle Bowman could either fan the flames or spritz them with reality water—scrutinized like a celebrity’s grocery list.
Economic tea leaves brew busily: factory data and manufacturing prints arrive amid a government shutdown that’s apparently too bureaucratic even for jobs reports. Wall Street, ever the multitasker, will also dissect earnings from McDonald’s, Yum! Brands, Uber, and Lyft to sniff consumer moods—like fast-food fortunes foretelling if shoppers splurge on nuggets or nurse their wallets.
Over half the S&P has reported, eyeing a ninth quarter of profit growth at 13%—twice preseason whispers, per Bloomberg Intelligence. It’s as if corporate America threw a surprise party and invited double the cake.
Yardeni’s parting wisdom? “Buy the dips if you’ve got cash—it’s like snagging clearance fudge.” But he waves off doomsayers: no 10% correction on the horizon, just enough wobble to keep seatbelts fastened.
In this market funhouse, where mirrors multiply the bulls, Yardeni’s cautionary bleat reminds us: even the sunniest forecasts cast shadows. As December’s tinsel twinkles, investors might just trade eggnog toasts for a prudent peek at the exit sign—lest the party’s piñata burst with confetti and cautionary tales.
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