The David Lin Report Market Top Time Bomb: $20 Trillion Yen Carry Trade Unwinds | Jim Welsh
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Nov 25, 2025 Jim Welsh, founder of Macro Tides and seasoned macroeconomic analyst, discusses his predictions for a secular bear market fueled by extreme valuations and weakening consumer sentiment. He reflects on his early warnings from 2007 and critiques the inflation narrative. Welsh emphasizes the difference between market declines and economic recessions, while spotlighting the risks of the yen carry trade unwinding, which could trigger significant selling pressure. He also shares insights on gold's potential pullback and the dollar's surprising resilience.
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Liquidity Tightening Preceded 2008 Collapse
- Jim Welsh spotted liquidity tightening in August 2007 and used that as an early warning for the 2008 crisis.
- He combined technical breadth measures and fundamental housing ratios to anticipate the downturn.
2022 GDP Drop Was Misleading
- Jim argued the 2022 GDP dip reflected inventory and trade swings, not a true recession.
- He emphasized strong job growth as a key reason to reject a recession call then.
Markets Can Bear Without Immediate Recession
- Jim expects a secular bear market even without an immediate recession because top households carry much of market exposure.
- Equity weakness would reduce top-decile spending and ripple through the economy.