MacroPass™: Ted Oakley's Q1 2025 Market Outlook
A concerningly high percentage of investors are singing "Don’t Worry … Be Happy"
This week’s installment of our popular MacroPass™ service for premium members of this Substack comes from high net worth financial advisor Ted Oakley.
It’s his quarterly market outlook for Q1 2025.
He’s quite concerned about the current sky-high levels of speculation, noting “This period we are in is marked by most investors seeing little or no difference between risky and riskless.”
To find out how he positioning client capital in such an environment, read on…
As a reminder, MacroPass™ is a weekly rotating selection of premium analysis from many of the big thinkers interviewed on Thoughtful Money.
To-date that list of contributors includes experts like Lacy Hunt (Hoisington), Stephanie Pomboy (Macro Mavens), Danielle DiMartino Booth (QI Research), Tom McClellan, Michael Howell (Capital Wars), Darius Dale (42 Macro), Doomberg, Ted Oakley (Oxbow Advisors), Kevin Muir (The Macro Tourist), Alf Peccatiello (The Macro Compass), Lance Lambert (ResiClub), Ed Yardini (Yardini Research), David Hay (Haymaker), Melody Wright (M3_Melody), David Stockman (Contra Corner), David Brady (FIPEST Report), John Rubino, Adam Kobeissi (The Kobeissi Letter), Sven Henrich (Northman Trader), Jeff Clark (The Gold Advisor), Charles Hugh Smith, Steven Bavaria (Inside the Income Factory®), Chris Whalen (The Institutional Risk Analyst), Felix Zulauf, Jesse Felder (The Felder Report) and Brent Johnson (Macro Alchemist).
Recent MacroPass™ reports in this series include:
If you’re already a premium subscriber to this Substack, just continue below to access Ted’s full report.
But if you’re not (yet), read the start of it below and consider upgrading to premium and access the full version, as well as all past and future MacroPass™ content.
Don’t Worry … Be Happy
Most investors finished 2024 in a great mood. With almost every type of investment doing well, there was little to worry about. This reminds us of the song, “Don’t Worry, Be Happy” by Bobby McFerrin, which in September 1988 reached No. 1 in the U.S.A. Later in this issue we’ll discuss why this pervasive attitude may need some tweaking.
We’ll also discuss where we are invested and what was best for us at Oxbow Advisors in 2024. In the beginning of the letter, you’ll see our caution about lofty prices. But in the end, you’ll see how Oxbow traverses that situation. So be sure to read it all.
For now, returns from various popular market measurements for the year ending December 31, 2024, are shown in Exhibit 1.
Diversification: Who Needs That?
Most investors have over 70% of their financial balance sheet in stocks. Heading into 2025 they see virtually no problems. They believe that there’s no recession risk, that no one sells stocks anymore … and this goes on endlessly. Notice Exhibit 2 showing that investors poured more money into stocks this past November than in any month the last five years. And that was at all-time highs in the market averages.
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