2025 Promises of growth, missing capital, and a system running on narratives rather than data – will 2026 deliver?.
Colossal Tech Investments: Announced, Not Delivered…Yet
The wave of billion-dollar technology investments announced by major U.S. companies remains largely theoretical.
To date, there is no visible deployment of capital, no clear timelines, and no concrete development plans.
These announcements function more as market signaling than as real economic stimulus.
Even high-profile moves, such as Meta’s acquisition of an AI company, amount primarily to internal financial
transactions—either cash transfers or equity exchanges between private shareholders.
Such operations do not translate into meaningful system-wide growth, job creation, or productive investment.
Saudi Capital: A Promise Without Footprints…Yet
Of the widely publicized $500 billion in investments allegedly promised by Saudi Arabia,
there is no evidence that even the first $100 billion has materialized.
More importantly, there is no clarity on where, when, or how
such capital would be deployed.
With crude oil prices oscillating in the $55–$62 range and Saudi Arabia facing the immense
financial burden of its own domestic development plan, the likelihood of large-scale U.S. investments in the
short to medium term appears limited.
Capital, when constrained, tends to stay at home.
The True Effects of Trade Tariffs: Not fully understood…Yet
The real economic impact of trade tariffs has not yet become fully visible.
Current data largely reflects transitional distortions rather than final outcomes.
A clearer assessment will only be possible around February 2026,
when inventory cycles, accounting treatments, and purchasing strategies have fully normalized.
The delay is primarily explained by LIFO (Last-In, First-Out) and
FIFO (First-In, First-Out) inventory accounting methods.
Many companies imported large volumes of goods ahead of tariff implementation,
locking in lower costs that are still being recognized on balance sheets and income statements.
As a result, current margins and price levels do not yet reflect the true cost structure
imposed by higher tariffs.
In parallel, bulk purchasing and inventory stockpiling temporarily muted
the pass-through effects of tariffs to consumer prices.
These practices allowed companies to delay price adjustments and preserve short-term profitability,
but they also created inflated inventory levels that must eventually unwind.
Once pre-tariff inventories are exhausted and replacement goods are sourced at higher tariff-inclusive prices,
the effects will become unavoidable.
At that point, companies will face a choice between compressing margins or passing costs through to consumers,
both of which carry macroeconomic consequences.
Until this adjustment phase is complete, any definitive judgment on the success or failure of trade tariffs
remains premature.
The data observed today is not the end result—it is merely the lagged reflection of past decisions.
Real Wages: Positive, but Fading
Real wages—often referred to as WKL earnings—remain marginally positive year-over-year at
+0.15%.
However, the trend is clearly declining.
In an environment where interest rates are not falling, this level of real wage growth is extremely fragile.
Sustaining nominal wage increases of 3.5%–4% annually under these conditions is difficult.
If wages stagnate while rates remain high, the system risks maintaining—or even expanding—its reliance on
imported goods and services.
Combined with tariffs, this dynamic increases the probability of renewed inflationary pressure.
The Market’s Real Objective: Preservation
For now, the priority of the so-called “Masters of the Market” is clear:
maintain current positioning until year-end.
Stability—real or perceived—is essential to avoid disrupting balance sheets and asset valuations.
Doubts are not a threat in this phase; they are being deferred.
Once timing becomes favorable, those same doubts will serve as fuel for sharp market seesaws,
ideal terrain for speculative operations.
Politics and Perception
On the political front, attention has shifted toward foreign policy—a domain that resonates little with the
immediate concerns of American households.
Slogans such as “We will return to greatness” may be emotionally appealing,
but in the current context they lack credibility.
Markets, unlike crowds, eventually demand evidence.
Until capital is deployed, wages stabilize, and growth materializes, rhetoric alone will not be enough
to alter the underlying trajectory.