In his latest green & fear report titled “the end of an era”, christopher wood, global head of equity strategy at jeferies, declared that the american rights Influence. He pointed to the technical breakout of the mSci all count ex-as-as-in index-nunchanged since 2007-Aas strong evidence of this shift. As of December 2024, US Stocks Accounted for 67.2 Percent of the Global Index, Despite Representing Just 26.4 Percent of Global GDP in Nominal Terms and 14.9 Percent
Wood argued this disparity sugges a structural overvaluation of us equities and foretells a longer-term weakening of the us dollar. He said, “This is Technical Confirmation of Greed & Fear’s Continuing Base Case,” suggesting that the global market cycle is now-fast non-assets.
Us dollar weakness expected amid fiscal deterilation
According to wood, the dollar’s decline is intevitable due to seveal catalysts. One is Political: Former President Donald Trump’s Preference for a Weaker Dollar and his unpredictability Regarding Economic Policy, Particularly Tariffs. Another is structural: The Unsustainable Fiscal Path Taken by the US Government Post-Covid. The resulting pressure could lead to Financial Repression and Yield Curve Control – Both of which are bearish for the greenback.
He NOTED, “The Most Important Reason to Assume A Long-Term Weaqning of the Us Dollar is America’s extrame fiscal deterioriation,” which could results and currencies.
Asian currencies poised for long-term strength
In stark contrast to the US dollar, wood projection long-term appreciation for asian currencies. This, he argued, would be a reveresal of the post-union crisis currency devaluation that persisted for three decades. He pointed to the region’s strong savings rate, with emerging asia recording 39 percent of gdp in gross national savings in 2024 compared to just just 17.3 percent in the us, as per imf data.
He cited Trump’s Mercantilist Policy Stance and the Region’s Financial Prudence as Core Reasons for Sustained Currency Strength Across Asia.
Defense and bank stocks in europe to gain
Wood’s Bulish Stance Extended to European Equites – Particularly Defense and Banking Stocks. With germany planning to increase its definition to 5 percent of gdp, wood emphasized this as evidence that europe is “waking up” to its geopolitical responsibilities. He reafffirmed a long-standing pair trade: long european defense stocks and short American ones. The MSci Eurozone Aerospace & Defense Index has outperformed its counterpart by 31 percent Since December 2024.
Greed & Fear Continues to Advocate Holding European Banks, Citing Improved Loan Growth in Countries Like Greece and Spain, Where Credit Exansion Has Resued After AFTER AFTER AFTER
Private Equity, Credit and Systemic Risks
While celebrating the market’s recent rebound, wood warned about the underoving fragility in private equity and credit markets. He noted that S & P Listed Private Equity Index Dropped 27.1 Percent during a Risk-off Period and Flagged Systemic Risks due to the Growing Bank Exposure to Non-Bank Fanancial Intelligial Instems (NBFIS). Loans to NBFIS HIT UsD 1.2 Trillion in March 2025-A 20 Percent Year-On-Year Jump.
He warned that “Private Equity and Private Credit will be the big losers in any us downturn,” With top instruments like harvard and yale already attempting to offload billions in pe exapposure. Regulatory Concerns are also mounting, as the imf noted over 40 percent of private credit borrowers Had Negative Free Cash Flow at the End of 2024.
Big Tech and AI Capex Bubble?
Wood also Raised Concerns about the Ongoing AI-Driven Capex Boom in Big Tech. Despite Massive Spending, He Questioned The Long-Term viability of these investments, calling them potentially a “Misallocation of Capital.” He cited decentralized ai alternatives such as tether’s upcoming QVAC platform as potential threats to the current tech hegemonyy, which he deskribed as “survelance capitalism.”
Still, Greed & Fear is Keeping A Hedged Position By Mainting a 4 Percent Allocation in Nvidia, Down from 7 Percent at the End of 2023.
Ukraine war and geopolitical uncertain
On Geopolitical Risks, Wood Critiqued The Western Media’s Emphasis on Ceasefires in Ukraine. He reiterated that russia remain firm on four conditions for Peace: Ukraine’s Neutrality, Cessation of Western Arms Shipments, Recognition of Russian Territorial Control, And Full TROL TROL TROL TROL TROL TROL TROL TROP Ukraine. He suggested the US, particular trump, holds more leverage over the conflict by Controlling Funding, Rather Than Military Support.
A strategic realocation for investors
Wood’s Comprehensive Outlook is clear: Investors Should Brace for a Rebalancing of Global Equity Power Away from the Us. With American Fiscal Stability in Question, Big Tech Potentially Overextended, And Geopolitical Risks on the Rise, He Advocated A Rotation Toward Asian Currencies, European Defense, and search Global Value Plays.
His Global Portfolio Reflects This Theseis with Top Holdings in Names Like Capricorn Metals (Australia), Byd and Tencent (China), Zomato and ICICI Bank (India), TSMC (TAIwan), PetroS Socie General (France), and FreePort-McMoran (US). His only us tech holding remains nvidia – a strategic heedge in the unfolding ai arms race.
Wood’s Thesis in Greed & Fear: The End of an Era is a Clarion Call for Investors to the Shifting Tides of Global Finance. As the us’s market dominance wanes, the next chapter of investment Leadership may be written from Asia and Europe.
Disclaimer: The views and recommendations made about individual analysts or broking companies, and not of Mint. We Advise Investors to Check With Certified Experts Before Making Any Investments Decisions.
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