Fundstrat
Fundstrat's Tom Lee on Friday's Selloff
10/13/2025, 12:50:57 PM
Economic Summary
- JPMorgan announced roughly $1.5 trillion in investments into the U.S., which Fundstrat says strengthens U.S. advantages in AI and blockchain and supports continued equity upside (JPM).
- Equities have rallied ~36% since April lows, and Tom Lee believes lower interest rates plus improving earnings are a powerful elixir for stocks, though valuations are elevated (mentions NVDA, Walmart/WMT, Costco/COST, Ford/F).
- Crypto markets retain substantial leverage via perpetuals (up to 20x–50x on some platforms), which caused large recent liquidations (estimates ≥ $19B) and creates systemic volatility risk for investors.
- There is an observed correlation between rising Tether (USDT) supply and gold prices; Fundstrat suggests stablecoins may be meaningful buyers of gold, affecting cross-asset flows.
Bullish
- JPMorgan's $1.5 trillion investment into the U.S. supports tech, AI, and blockchain-led growth.
- Lower interest rates plus improving earnings are a strong tailwind for stocks.
- Large amounts of sidelined cash could flow into equities, sustaining the rally.
- Stablecoin demand (e.g., Tether) may be lifting gold, creating cross-asset buying dynamics.
Bearish
- Crypto market contains large hidden leverage via perpetuals, driving big liquidation cascades and volatility.
- Markets are not cheap after a 36% rally since April lows; valuation risks remain.
- Economic shutdowns could be disinflationary but hurt employment, complicating Fed policy and growth.
Bullish tickers
JPMNVDABTCETHUSDT
Bearish tickers
BTCETHUSDT
NVDA
Bullish
Beneficiary of AI dominance and a core reason for optimism about tech-led earnings growth.
Bearish
Valuations are rich relative to traditional earnings metrics despite being cheaper on a PE basis versus some staples.
F
Bullish
Referenced mainly as a valuation comparator rather than a focal bullish case.
Bearish
Used as a baseline in valuation comparisons; implies some large-cap tech valuations are high versus industrial peers.
WMT
Bullish
Not a central bullish focus in the discussion.
Bearish
Plays a role in valuation comparisons that highlight stretched tech multiples.
COST
Bullish
Referenced only in relative valuation context.
Bearish
Mentioned as part of valuation comparisons to illustrate relative PE levels.
JPM
Bullish
Announced ~$1.5 trillion in U.S. investments, viewed as a structural positive for AI, blockchain, and the U.S. economy.
Bearish
Large bank investments could concentrate risk if execution falters, but no explicit bearish case provided.
BTC
1 price targets
107000
Bullish
Volatility provided buying opportunities; cited example of an investor buying BTC at about 107,000 during selloffs.
Bearish
High leverage in crypto derivatives can cause steep drawdowns and liquidation cascades for BTC holders.
ETH
2 price targets
36004200
Bullish
Raised from ~3,600 to ~4,200 after liquidations, showing strong short-term rebound potential.
Bearish
Perpetuals and margin use outside core ETH holders can amplify declines and trigger liquidations.
USDT
Bullish
Correlation between rising Tether supply and gold suggests stablecoins may be incremental buyers of gold.
Bearish
Growing Tether supply may reflect leveraged or opaque flows; could transmit crypto volatility into other assets.
COIN
Bullish
Exchanges offering perpetuals and leverage provide liquidity and access, supporting crypto market activity.
Bearish
Crypto exchange products that offer high leverage increase systemic risk for retail traders.
People mentioned
Tom LeeAndrewWarren BuffettJamie DimonJerome Powell