By Bardil 
Bloomberg commodity strategist MIKE MCGLONE has issued a stark warning about the possibility of a significant correction in US markets, which could severely impact the prices of Bitcoin, oil, and equities. Speaking on the social media platform X, MCGLONE highlighted the presence of a “self-correcting mechanism” in the US economy that might counteract the effects of former President DONALD TRUMP‘s tariff policies, potentially leading to widespread market turmoil.
MCGLONE shared a chart illustrating that the S&P 500’s ratio to GDP and its ratio to gold are both at historically elevated levels. Such conditions have previously signaled major stock market crashes, including those in the 1930s, the late 1990s, and 2008. According to the analyst, a market “reversion” of this nature could result in substantial declines in stocks, Bitcoin, oil, copper, and bonds.
“America’s self-correcting mechanism is unstoppable. If unprecedented tariffs and austerity don’t work, pushback will come in the next elections. If the great rebalance attempt works, it could reset world order underpinnings for the coming century,” MCGLONE stated. “The problem is that the discombobulation is coming with US stock market cap vs. GDP and the rest of the world, the highest in about 100 years.”
The strategist outlined his base case for normal reversion, predicting:
- A 50% drawdown in the US stock market
- Crude oil at $40 a barrel
- Copper at $3 per pound
- US 10-year yield at 3%
- Bitcoin at $10,000, with 90% drawdowns in most cryptocurrencies
- Gold at $4,000, acting as an outlier due to its unique properties
Despite the severity of these projections, MCGLONE emphasized that such drawdowns are “normal” when viewed through the lens of historical market trends. At the time of writing, Bitcoin is trading at $87,529.
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Source: MIKE MCGLONE‘s analysis on X