MEMORANDUM: Emergency Dispatch from the Trading Floor
TO: All Surviving Portfolio Managers
FROM: The Last Honest Analyst
RE: Everything Broke and Nobody Wants to Admit It
DATE: September 28, 2025
Listen up.
I'm writing this at 3:47 AM because sleep has become a luxury I can no longer afford. The screens are all green but the underlying machinery is making sounds I've never heard before. Grinding. Screeching. The kind of noise a transmission makes right before it drops onto the highway.
Let me tell you what actually happened these past 48 hours while everyone was busy celebrating new all-time highs.
THE GREAT DIVERGENCE
The S&P 500 kissed 6,693.75 on Monday. Fresh record. Champagne corks popping on trading floors from Manhattan to Mayfair. Meanwhile, Michigan consumer sentiment cratered 5.3% in September — but here's the kicker: sentiment for consumers WITH stock holdings held steady. The ones WITHOUT stocks? They're watching their world burn while asset owners toast marshmallows over the flames.
We've created two economies. One for the ownership class riding Nvidia's 30% quarterly miracle. Another for everyone else watching their rent eat 60% of their paycheck.
THE CHINA CONTRADICTION
Beijing keeps promising stimulus. The market keeps believing them. The Hang Seng sits up 23% year-to-date, gorging itself on foreign capital and dollar weakness like a starving man at a buffet. But look closer. Household consumption contributed just 29% to headline GDP in Q3, down from nearly half before anyone had heard of wet markets in Wuhan.
They're building bridges to nowhere while their consumers hunker down like it's 1989 again. Every Western fund manager I know is piling into Chinese equities based on stimulus promises that amount to rearranging deck chairs. The real number that matters? China's economic activity slowed more than expected across the board in August.
Translation: The factory of the world is running out of customers.
THE OIL PARADOX
Here's something beautiful in its absurdity: Crude Oil rose to $65.19 per barrel on September 26, yet China continues to stockpile crude oil like they know something we don't. Brent barely budges from $67 despite toughened sanctions on Iran and Russia.
You know what this tells me? The physical economy and the financial economy have filed for divorce. One is pricing in infinite growth, the other is hoarding barrels for the winter that's coming.
THE GOLD CONFESSION
Gold hit a fresh intraday all-time high of $3,824.60. Thirty-seven record closes this year. THIRTY-SEVEN.
When gold screams this loud, it's not celebrating — it's warning. Every central bank on Earth is buying physical metal while telling their citizens that fiat is fine, inflation is transitory, and digital currencies are the future. The barbarous relic is up 44% year-to-date while Powell mumbles about "risk management."
THE POWELL PANTOMIME
Our beloved Fed Chair delivered his first rate cut of 2025 — a surgical 25 basis points from 4.3% to 4.1%. He called it "risk management." I call it administering aspirin to a patient having a heart attack.
The labor market is "cooling off," he says. Cooling off. Like saying the Titanic is "taking on a bit of water."
THE SEPTEMBER CURSE EVOLVED
Everyone knows September kills rallies. It's supposed to be the cruelest month for equities. Average pullback of 4.2% over the last five years. But this September? The S&P gained more than 2% for the month.
The curse didn't disappear — it migrated. To crypto (down 2.2% in 24 hours). To consumer confidence (collapsed). To the real economy (gasping). The stock market levitates while everything else suffocates. We've broken the oldest rule in markets: September always wins. Now I don't know what game we're playing anymore.
THE UNCOMFORTABLE TRUTH
Oracle dropped 5% on Friday. Three straight days of losses. Why? Because someone finally asked the obvious question: If AI is the future, why isn't it showing up in anybody's earnings?
Natural gas prices are up 40% year-over-year. Natural gas fuel prices in 2025 are about 40% higher than in 2024, forcing a retreat to coal. COAL. In 2025. While we're supposedly transitioning to clean energy. Every Tesla owner should frame that statistic above their charging station.
THE FINAL DIAGNOSIS
Here's what nobody wants to say out loud: We're not in a bubble. Bubbles eventually pop. We're in something worse — a permanent disconnect between price and reality sustained by infinite liquidity and the desperate prayer that if we all believe hard enough, the music never has to stop.
The wealth effect has become our entire economic policy. The stock market may be keeping the economy out of recession, but at what cost? We're a cardiac patient kept alive by adrenaline shots, each one needing to be bigger than the last.
Every portfolio manager reading this knows I'm right. Every analyst staring at their Bloomberg terminal at 2 AM knows it too. But Monday morning, we'll all show up, put on our game faces, and pretend the machinery isn't screaming.
Because the alternative — admitting the whole thing is broken — would require us to rebuild from scratch. And nobody gets a bonus for telling that truth.
Sleep tight.
—The Last Honest Analyst
P.S. - Long gold, short sanity. It's the only trade that makes sense anymore.