Renowned cryptocurrency-focused economist Timothy Peterson has issued a stern warning about the economic outlook, predicting that a major bear market and potential recession are on the horizon.
Peterson, known for his unique economic metric called the Secular Market Indicator, voiced his concerns in a statement that sparked controversy among investors.
Peterson introduced his Secular Market Indicator six years ago in the Journal of Wealth Management. The metric was developed to assess whether the economy is in a long-term growth or stagnation phase, and the analyst says it offers important insights beyond traditional tools like the Shiller P/E ratio or the Buffett Indicator. Peterson criticized the old models, saying they “went bankrupt in 2008” and now don’t provide meaningful forecasts.
In contrast, he noted that in the model developed by Peterson, gold is used as a fundamental variable and is considered a proxy for tangible assets, especially commodities, as opposed to paper-based investments. Peterson announced that the Secular Market Indicator was “fully triggered” for the first time after 2021. Based on these indicators, he predicted that the annual return of stocks will not exceed 5% for the next decade and that a major market crash may occur in the next two years.
Drawing parallels with past economic crises, recalling the bear markets of 2022, 2008 and 2000, Peterson predicted that the first signs of decline could appear in the summer of 2025. He urged investors to be careful, warning that such events could develop faster than expected.
Peterson emphasized that the bearish trend also includes Bitcoin and cryptocurrency markets. Recalling Bitcoin’s performance during previous market crashes like the one in 2022, the economist warned investors that the current cycle could be similar.
