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Economy Rewind, 11/26/25
"The 2026 Crash: A Documentary Of Why Late
2026-2027 Will Be Worse Than 1929 & 2008"
"There's a pattern in economic history that repeats with mechanical precision. Not randomly. When specific conditions align: Extreme asset valuations. Record debt levels. Excessive leverage. Widespread belief "this time is different." Then a trigger event forces liquidation. These conditions existed in 1929. They existed in 2008. Right now in 2025, every single condition exists again. Not similar. IDENTICAL. The stage is set. If history is any guide, the crash comes late 2026 or early 2027. This isn't prophecy. This is pattern recognition. A documentary analysis of a crash that hasn't happened yet but follows a pattern that happened twice before with devastating accuracy.
Where We Are Now - The Setup: Stock market: S&P 6,000. Buffett Indicator (market cap to GDP) at 185%. Buffett said anything over 120% is dangerous. We're 54% above danger threshold. 2000 tech bubble peak: 145%. 2007 financial crisis: 135%. We're higher than both. Most overvalued stock market in American history.
• Real estate: Median home $420K. Median income $75K. Ratio 5.6:1. Historical sustainable: 3:1.
• Housing 87% overvalued. 2006 pre-crash peak: 5.0:1. We're higher now.
• Corporate debt: $13.5T (72% of GDP). 2007: 43% of GDP. Corporations more leveraged than before last crisis.
• Government debt: $39T (120% of GDP). Interest payments approaching $1T annually.
• Consumer debt: $17T (credit cards, auto, student loans).
• Total US debt: Over $90T (320% of GDP). Every sector leveraged beyond historical norms simultaneously. This is the everything bubble.
The FED'S Trap: 15 years since 2009, Fed guaranteed markets. Every dip = Fed cuts rates or prints money (QE1, QE2, QE3, COVID stimulus). Fed printed $8T (2008-2022). Investors learned: Buy the dip. Fed will save you. But Fed used its ammunition. Rates were 0% for decade (can't go lower). Balance sheet $800B (2008) to $9T (2022). Limited room for expansion without inflation (which happened 2021-2022).
Fed fought inflation by raising rates 0% to 5.5% in 18 months (fastest in 40 years). Higher rates make debt expensive. Corporate debt at 3% must refinance at 7%. Fed trapped: Rates too low = inflation returns. Rates too high = debt unpayable. No good option.
Historical Comparison:
• 1929: Stock market up 400% (1924-1929). Margin debt 10% of GDP. Everyone leveraged. "Permanently high plateau" = crashes impossible. October came. Market fell 89% over 3 years.
• 2008: Housing doubled (2000-2006). Mortgage debt 100% of GDP. Everyone leveraged with subprime. "Housing never falls nationally." Subprime defaulted. S&P fell 57%.
• 2026: Same setup. Bubble. Leverage. Belief Fed makes crashes impossible. Just need trigger."
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