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EndGame Macro
The Generation That Caught the Wave of a Lifetime
People over 70 now control about a third of all U.S. household wealth. That’s the highest share we’ve ever recorded, and it didn’t happen by accident or luck. It happened because this generation’s life story lined up almost perfectly with the way the modern financial system evolved.
And when you trace that path, the picture becomes clearer…almost inevitable.
Why This Generation Ended Up Owning So Much
Start with timing. Most Americans who are 70 plus today bought homes in the 1970s, 80s, or early 90s periods when the dollar stretched further, wages went further, and housing wasn’t treated like a speculative asset class. A single income could often buy a starter home. A college degree didn’t come with a lifetime of debt attached to it. And the typical cost of living package allowed families to save in a way that feels almost foreign now.
Then combine that timing with the monetary regime shift that began in the early 1980s. For forty years, interest rates did mostly one thing…fall. Lower and lower. Every step down increased the value of the assets people already owned. Home values climbed. Bonds climbed. Stocks climbed. Even retirement accounts sitting quietly in index funds benefitted simply because the entire financial system was being repriced upward.
You didn’t have to trade like a genius. You just had to hold on through history’s longest asset boom.
And because most households build wealth primarily through housing, the numbers get even more striking. Nearly 80% of Americans over 65 own a home and around two thirds of them own it outright, with no mortgage hanging over them. When home prices doubled and then doubled again, that equity didn’t trickle up or down; it pooled right where the ownership already was.
What People Miss When They Look at This Chart
This isn’t just a story about individual success or discipline. It’s a story about structure and how policy, demographics, and the timing of one large generation moving through the system can reshape the economy.
A huge cohort was born right as the U.S. entered the most explosive population and productivity expansion in its history. They matured into the workforce during a period of higher purchasing power. They bought homes before housing scarcity and financialization transformed the market. And they lived long enough to benefit from decades of compounding in a system increasingly designed to stabilize asset prices.
When you step back, the curve on this chart isn’t surprising. It’s almost the logical endpoint of the world they inherited and the world they lived through.
The Bigger Implication
The question now isn’t just how much wealth they hold, it’s what happens next. A generation this large holding this much capital changes everything with housing turnover, consumption patterns, intergenerational transfers, even the politics of inflation and interest rates.
Understanding the chart means understanding the era that produced it. And it means recognizing that the next era, the one where this wealth eventually moves, slowly or suddenly may reshape just as much as the last fifty years did.
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The Generation That Caught the Wave of a Lifetime
People over 70 now control about a third of all U.S. household wealth. That’s the highest share we’ve ever recorded, and it didn’t happen by accident or luck. It happened because this generation’s life story lined up almost perfectly with the way the modern financial system evolved.
And when you trace that path, the picture becomes clearer…almost inevitable.
Why This Generation Ended Up Owning So Much
Start with timing. Most Americans who are 70 plus today bought homes in the 1970s, 80s, or early 90s periods when the dollar stretched further, wages went further, and housing wasn’t treated like a speculative asset class. A single income could often buy a starter home. A college degree didn’t come with a lifetime of debt attached to it. And the typical cost of living package allowed families to save in a way that feels almost foreign now.
Then combine that timing with the monetary regime shift that began in the early 1980s. For forty years, interest rates did mostly one thing…fall. Lower and lower. Every step down increased the value of the assets people already owned. Home values climbed. Bonds climbed. Stocks climbed. Even retirement accounts sitting quietly in index funds benefitted simply because the entire financial system was being repriced upward.
You didn’t have to trade like a genius. You just had to hold on through history’s longest asset boom.
And because most households build wealth primarily through housing, the numbers get even more striking. Nearly 80% of Americans over 65 own a home and around two thirds of them own it outright, with no mortgage hanging over them. When home prices doubled and then doubled again, that equity didn’t trickle up or down; it pooled right where the ownership already was.
What People Miss When They Look at This Chart
This isn’t just a story about individual success or discipline. It’s a story about structure and how policy, demographics, and the timing of one large generation moving through the system can reshape the economy.
A huge cohort was born right as the U.S. entered the most explosive population and productivity expansion in its history. They matured into the workforce during a period of higher purchasing power. They bought homes before housing scarcity and financialization transformed the market. And they lived long enough to benefit from decades of compounding in a system increasingly designed to stabilize asset prices.
When you step back, the curve on this chart isn’t surprising. It’s almost the logical endpoint of the world they inherited and the world they lived through.
The Bigger Implication
The question now isn’t just how much wealth they hold, it’s what happens next. A generation this large holding this much capital changes everything with housing turnover, consumption patterns, intergenerational transfers, even the politics of inflation and interest rates.
Understanding the chart means understanding the era that produced it. And it means recognizing that the next era, the one where this wealth eventually moves, slowly or suddenly may reshape just as much as the last fifty years did.
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Offshore
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Fiscal.ai
Salesforce went from 2% to 21% operating margins in 3 years.
How much further could margins expand?
$CRM https://t.co/T5J726Jcs6
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Salesforce went from 2% to 21% operating margins in 3 years.
How much further could margins expand?
$CRM https://t.co/T5J726Jcs6
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EndGame Macro
https://t.co/MibWSawuhc
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https://t.co/MibWSawuhc
BREAKING: U.S. layoffs set to surpass the Great Recession levels, on track to be worst since Great Depression. tweet
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memenodes
boomers when you don’t want to buy their overpriced house and retire at 90 https://t.co/pUwGT0sJQE
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boomers when you don’t want to buy their overpriced house and retire at 90 https://t.co/pUwGT0sJQE
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EndGame Macro
A Classic Market Turn in a Not So Classic Economy
This ratio is really just telling you who’s been taking the lead in the market: the real economy sectors including financials, industrials, materials versus the S&P 500 as a whole. When the line turns higher, it means these old economy, capital intensive parts of the market are outperforming the index. Historically, those inflection points haven’t been random. They’ve lined up with moments when the market decided the old regime was ending and a new one was beginning like the early 1990s bull run, the final days before the dot com peak, the turn right before the GFC bottom, and the early phase of the post Covid rally. It’s less about clairvoyance and more about positioning, leadership tends to shift when the underlying story is shifting.
My Take Given What’s Actually Happening in the Economy
The catch is that this upswing isn’t happening in a clean, healthy backdrop. The data under the hood looks worse than most people want to admit. Delinquencies are rising across all consumer buckets with student loans at record levels, auto loans back above pre pandemic stress, credit cards at 12% plus, and even commercial real estate creeping toward 10% CMBS delinquency. Bankruptcies? The highest in 15 years and still trending up. In other words, the economy isn’t in a cyclical recovery. It’s in a stretched late cycle environment where households are running out of cushion and businesses are feeling the squeeze from higher rates.
So why would this ratio be turning up now? Because markets don’t wait for the fundamental picture to improve, they trade the moment central banks look forced to pivot. Financials move first on the direction of rates, not the quality of the loan book. Industrials and materials can rally simply because nominal spending is sticky and fiscal spending hasn’t meaningfully slowed. Equal weight outperformance is often a sign of decrowding with money leaking out of an exhausted mega cap trade and into everything it ignored for two years.
Where This Likely Leads
Honestly, this doesn’t look like the early 1990s or 2020. Those turns happened when the fundamentals were lining up with the rotation. Today, the fundamentals are deteriorating and at a pace that’s hard to ignore. Rising delinquencies across consumers, a wave of bankruptcies among large companies, and signs of labor softness beneath the headline unemployment rate all point to an economy under real strain, not one about to accelerate.
So in my opinion the market is trying to front run easier policy not a stronger economy.
If credit stress stays contained, the rotation into financials, industrials, materials, and small caps can run a bit longer. But if the consumer cracks further or bankruptcies spill into credit markets, this turn won’t have staying power. Financials will be the first to reverse. Industrials will follow. And leadership will swing back to defensives or back to mega cap growth, not because they’re cheap, but because they’re liquid and insulated.
This chart is flashing regime change, but the economy beneath it is flashing late cycle stress. One of those signals will eventually win and the bankruptcy and delinquency data suggest the fundamental side is already pressing its case.
Historically, when this chart turned up after tanking the way it has this year, the entire vibe of the market witnessed a wholesale regime change. This includes:
October 31, 1990, which is just 3 weeks into the bull market that lasted 9.5 more years.
March 9, 2000: one day prior to the Dot-Com peak.
March 5, 2009: 4 days before the S&P 500 would make its Global Financial Crisis low.
The action is the equal-weighted S&P 500 Financials + S&P 500 Industrials + S&P 500 Materials relative to the S&P 500 as a whole. These three sectors have been outperforming since November 3.
If past is prologue and the vibe does shift, that would mean concepts like Value would be On, these three sectors On, small caps On, mega ca[...]
A Classic Market Turn in a Not So Classic Economy
This ratio is really just telling you who’s been taking the lead in the market: the real economy sectors including financials, industrials, materials versus the S&P 500 as a whole. When the line turns higher, it means these old economy, capital intensive parts of the market are outperforming the index. Historically, those inflection points haven’t been random. They’ve lined up with moments when the market decided the old regime was ending and a new one was beginning like the early 1990s bull run, the final days before the dot com peak, the turn right before the GFC bottom, and the early phase of the post Covid rally. It’s less about clairvoyance and more about positioning, leadership tends to shift when the underlying story is shifting.
My Take Given What’s Actually Happening in the Economy
The catch is that this upswing isn’t happening in a clean, healthy backdrop. The data under the hood looks worse than most people want to admit. Delinquencies are rising across all consumer buckets with student loans at record levels, auto loans back above pre pandemic stress, credit cards at 12% plus, and even commercial real estate creeping toward 10% CMBS delinquency. Bankruptcies? The highest in 15 years and still trending up. In other words, the economy isn’t in a cyclical recovery. It’s in a stretched late cycle environment where households are running out of cushion and businesses are feeling the squeeze from higher rates.
So why would this ratio be turning up now? Because markets don’t wait for the fundamental picture to improve, they trade the moment central banks look forced to pivot. Financials move first on the direction of rates, not the quality of the loan book. Industrials and materials can rally simply because nominal spending is sticky and fiscal spending hasn’t meaningfully slowed. Equal weight outperformance is often a sign of decrowding with money leaking out of an exhausted mega cap trade and into everything it ignored for two years.
Where This Likely Leads
Honestly, this doesn’t look like the early 1990s or 2020. Those turns happened when the fundamentals were lining up with the rotation. Today, the fundamentals are deteriorating and at a pace that’s hard to ignore. Rising delinquencies across consumers, a wave of bankruptcies among large companies, and signs of labor softness beneath the headline unemployment rate all point to an economy under real strain, not one about to accelerate.
So in my opinion the market is trying to front run easier policy not a stronger economy.
If credit stress stays contained, the rotation into financials, industrials, materials, and small caps can run a bit longer. But if the consumer cracks further or bankruptcies spill into credit markets, this turn won’t have staying power. Financials will be the first to reverse. Industrials will follow. And leadership will swing back to defensives or back to mega cap growth, not because they’re cheap, but because they’re liquid and insulated.
This chart is flashing regime change, but the economy beneath it is flashing late cycle stress. One of those signals will eventually win and the bankruptcy and delinquency data suggest the fundamental side is already pressing its case.
Historically, when this chart turned up after tanking the way it has this year, the entire vibe of the market witnessed a wholesale regime change. This includes:
October 31, 1990, which is just 3 weeks into the bull market that lasted 9.5 more years.
March 9, 2000: one day prior to the Dot-Com peak.
March 5, 2009: 4 days before the S&P 500 would make its Global Financial Crisis low.
The action is the equal-weighted S&P 500 Financials + S&P 500 Industrials + S&P 500 Materials relative to the S&P 500 as a whole. These three sectors have been outperforming since November 3.
If past is prologue and the vibe does shift, that would mean concepts like Value would be On, these three sectors On, small caps On, mega ca[...]
Offshore
EndGame Macro A Classic Market Turn in a Not So Classic Economy This ratio is really just telling you who’s been taking the lead in the market: the real economy sectors including financials, industrials, materials versus the S&P 500 as a whole. When the line…
ps Off, Tech Off. - Jeff Weniger tweet
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Clark Square Capital
RT @ClarkSquareCap: I wrote up a review of the alt-data software @tickerplus TickerTrends. You can check it out here:
https://t.co/NAy15kcBSD
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RT @ClarkSquareCap: I wrote up a review of the alt-data software @tickerplus TickerTrends. You can check it out here:
https://t.co/NAy15kcBSD
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Offshore
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EndGame Macro
The Real Danger Isn’t the Fed’s Balance Sheet It’s the Lag Behind It
When you zoom out and look at the Fed’s balance sheet, the pattern is almost comically predictable. Every crisis sends the line straight up. Every attempt to shrink it happens slowly, cautiously, and only when the world is calm enough to tolerate it. That’s exactly what this latest drop shows. QT got the Fed part of the way back, but nowhere near pre Covid normalization. We’re basically sitting right at early 2020 levels not because everything is healed, but because this is where policymakers could stop without breaking something important.
The Lesson Everyone Forgets
The bigger story here isn’t the level of the balance sheet, it’s the lag. Go back to 2020–2021. The government didn’t just stimulate; it carpet bombed the system with support…
•massive QE
•emergency rate cuts to zero
•trillions in direct stimulus checks
•enhanced unemployment that paid more than work for millions
•PPP loans and grants
•mortgage forbearance
•foreclosure moratoriums
•rental assistance
•student-loan pauses
•expanded child-tax credits
It was the largest fiscal monetary rescue in modern U.S. history…roughly 25% of GDP when you add it all up.’🤯
And even with all of that, inflation didn’t explode instantly. It took almost 2 years for the full effects to show up. That’s how slow the transmission mechanism really is. Policy doesn’t hit the real economy like a lightning bolt, it moves through cash flow, credit channels, spending behavior, and finally prices.
Why The Cuts And QE Will Save Us Idea Doesn’t Hold Up
This is where today’s popular narrative falls apart. People talk like a Fed cut or a future round of QE will instantly relieve the pressure. But if 2020 taught us anything, it’s that even overwhelming support takes a long time to work its way through the system.
And now we’re facing the opposite setup. Tightening has been running for 2 years, households are stretched, delinquencies are rising, corporate bankruptcies are hitting 15 year highs, and small businesses are running out of cushion.
Meanwhile, Washington isn’t gearing up for another all encompassing rescue. The sweeping, across the board relief measures we saw during Covid simply aren’t coming back…politically, fiscally, or inflation wise. And the Fed doesn’t have the cover or the room to run another multi trillion dollar QE surge even if conditions deteriorate.
So yes, cuts will come. And eventually QE will come back too, it always does. But neither one will undo the tightening that already happened, and neither one can instantly reverse the stress already moving through the economy.
The lag is real. And this time, unlike 2020, there isn’t a 25% of GDP parachute waiting to soften the fall.
tweet
The Real Danger Isn’t the Fed’s Balance Sheet It’s the Lag Behind It
When you zoom out and look at the Fed’s balance sheet, the pattern is almost comically predictable. Every crisis sends the line straight up. Every attempt to shrink it happens slowly, cautiously, and only when the world is calm enough to tolerate it. That’s exactly what this latest drop shows. QT got the Fed part of the way back, but nowhere near pre Covid normalization. We’re basically sitting right at early 2020 levels not because everything is healed, but because this is where policymakers could stop without breaking something important.
The Lesson Everyone Forgets
The bigger story here isn’t the level of the balance sheet, it’s the lag. Go back to 2020–2021. The government didn’t just stimulate; it carpet bombed the system with support…
•massive QE
•emergency rate cuts to zero
•trillions in direct stimulus checks
•enhanced unemployment that paid more than work for millions
•PPP loans and grants
•mortgage forbearance
•foreclosure moratoriums
•rental assistance
•student-loan pauses
•expanded child-tax credits
It was the largest fiscal monetary rescue in modern U.S. history…roughly 25% of GDP when you add it all up.’🤯
And even with all of that, inflation didn’t explode instantly. It took almost 2 years for the full effects to show up. That’s how slow the transmission mechanism really is. Policy doesn’t hit the real economy like a lightning bolt, it moves through cash flow, credit channels, spending behavior, and finally prices.
Why The Cuts And QE Will Save Us Idea Doesn’t Hold Up
This is where today’s popular narrative falls apart. People talk like a Fed cut or a future round of QE will instantly relieve the pressure. But if 2020 taught us anything, it’s that even overwhelming support takes a long time to work its way through the system.
And now we’re facing the opposite setup. Tightening has been running for 2 years, households are stretched, delinquencies are rising, corporate bankruptcies are hitting 15 year highs, and small businesses are running out of cushion.
Meanwhile, Washington isn’t gearing up for another all encompassing rescue. The sweeping, across the board relief measures we saw during Covid simply aren’t coming back…politically, fiscally, or inflation wise. And the Fed doesn’t have the cover or the room to run another multi trillion dollar QE surge even if conditions deteriorate.
So yes, cuts will come. And eventually QE will come back too, it always does. But neither one will undo the tightening that already happened, and neither one can instantly reverse the stress already moving through the economy.
The lag is real. And this time, unlike 2020, there isn’t a 25% of GDP parachute waiting to soften the fall.
BREAKING: The Federal Reserve’s balance sheet fell -$37 billion in November, to $6.53 trillion, to its lowest level since April 2020.
The Fed has reduced its assets by -$2.43 trillion, or -27%, during its quantitative tightening (QT) program, which ended on December 1st after running for 3 years and 5 months.
This unwound 51% of the +$4.81 trillion added during pandemic-era QE.
Treasury securities declined -$4 billion in November, to $4.19 trillion, the lowest since June 2020.
We have now see a -$1.58 trillion decline in treasury securities, or -27.4%, from the June 2022 peak.
Mortgage-backed securities fell -$16 billion last month, to $2.05 trillion, the lowest since November 2020, down -$687 billion from the 2022 peak.
QT is officially over. tweet