Opinion

Something strange is going on. The US economy is growing, but no jobs are being added. In fact, unemployment is rising to 4.6 percent. Normally, it works like this: first jobs are created, then wages rise, then spending increases. Now that order has been reversed. People are spending money they have not earned.

For the average institutional investor, the appeal of lottery-like stocks—shares with a low price, high potential returns, and extreme volatility—is a mystery. But poorer investors simply reason very differently.

The Cambrian explosion of AI-driven life forms has begun. Under the collective label of artificial intelligence, an ecosystem is emerging that is evolving faster than many people realize. Its impact is still often underestimated, both in scale and in speed, but it will permanently shape the second half of the twenty twenties as a structural force.

The Democrats are on track to win the U.S. House of Representatives in 2026. For investors, that is usually just noise. Now, however, even the most committed progressive has to admit the timing is terrible. Things were going so well.

There was eager anticipation for a new US labor market report. And not only because the flow of macro data from the United States is still lagging as a result of the shutdown. The US labor market is what can still obscure the real reason why rates were cut by another quarter point. But that argument does not hold either.

In financial markets, 2026 will not only be a year of economic normalization, but also a test of the institutional fabric of US monetary policy. Renewed political polarization and the approaching expiration of central banker Jerome Powell’s term are creating a rare convergence of uncertainty for the period ahead.

Last week, China’s trade surplus crossed the threshold of one thousand billion dollar for the first time. In the first eleven months of 2025 alone, China exported one trillion dollar more than it imported. It is a milestone that both illustrates the export strength of Chinese industry and exposes the deep problems in China’s growth model, while further fueling calls for protectionism in the rest of the world.

Market sentiment in fixed income is turning quickly. Within just a few weeks, investors and even central bankers have rotated one hundred eighty degrees. Rising inflation risk and an even greater lack of fiscal discipline are pushing yields higher. It is a nightmare scenario for politicians and the run-up to a major confrontation.

The traditional 60/40 portfolio is dead, long live the 60/40 portfolio.

It’s December, and so the focus is shifting to 2026. As always, this comes with a wave of outlooks that are, unfortunately, often already partly outdated by the time the new year begins. Still, a dynamic is now unfolding that could lead to quite a bit of fireworks next year.