It’s been a jittery couple of weeks, and more and more investors and pundits (including Unhedged) are talking about downside scenarios and bear cases.

1. Fiscal "largesse" -- frontloaded stimulus from OBBB running out

2. Stimulus check nonsense...?
3. Company profits are fine, and Big Tech not overvalued

S&P 500 revenues rose solidly faster than inflation in the third quarter and margins are widening. And no, the Magnificent 7 are not doing all the work. Consider this chart from FactSet, or revenue growth by sector

you will notice one item conspicuously absent from the above list: Federal Reserve rate cuts. Given the prominent place fiscal looseness and bond-market fiddling play in the bull case, deep rate reductions would be too much to hope for. The scariest risk, in our view, is not an AI meltdown but resurgent inflation, which could topple the very large, delicately balanced financial superstructure resting on top of the US economy. If core CPI goes back above 4 per cent, all bets are off.

The crypto whiplash has been intense over the past few weeks. Bitcoin prices hit an all-time high of about $126,000 in early October. Less than a week later, Trump threatened “massive” China tariffs, the apparent catalyst for the liquidation of $20bn in leveraged crypto positions, the largest single-day sell-off on record. The wipeout in value has continued.

This leaves the cryptocurrency trading at the levels of way back in, er, April.

It is worth remembering how far the picture just sketched is from the original promise of Bitcoin. It was the future of money; it was digital gold; it was an alternative to what the analogue financial system had to offer. Now, it looks like another leveraged financial asset, intertwined with the fate of the tech sector. But, producing no cash flows, it is unusually dependent on the vicissitudes of market liquidity and market mood.