🚨 THE STOCK MARKET IS FLASHING THE SAME WARNING SIGNAL SEEN BEFORE EVERY MAJOR CRASH SINCE 1984. And right now, it is happening again. A 40-year chart of the US 10-Year Treasury yield shows the same pattern repeating over and over again. Before the 1987 stock market crash, the dot-com collapse, the 2008 financial crisis, the 2018 selloff, and the 2022 bear market, bond yields spiked sharply higher first. The reason is simple. Stocks and bonds compete for the same money. When Treasury yields rise, large investors can suddenly earn high “risk-free” returns from government bonds. That pulls money away from stocks. And the more expensive the stock market becomes, the more dangerous that shift gets. Right now, the US 30-year Treasury yield has surged to 5.20%. That is the exact same level seen in 2007 right before the Global Financial Crisis. But today’s stock market is even more overvalued than it was back then. The Buffett Indicator is now around 234% of GDP. Before the 2008 crash, it was around 105%. The Shiller CAPE ratio is near 40. The only time valuations were higher was during the 1999 dot-com bubble. This is creating a massive problem for equities. Stocks are no longer offering enough return compared to bonds. The Equity Risk Premium has now fallen to around -1.5%. That means investors are taking significantly more risk in stocks while earning less return than long-term Treasuries. The last time this happened was during the 2000-2002 tech collapse. At the same time, the drivers behind rising yields are becoming more dangerous. US national debt has now crossed $38 trillion. Annual interest payments are above $1 trillion for the first time ever. Oil prices are also surging again as tensions involving Iran continue pushing inflation risks higher. And global bond markets are starting to break together. Japan’s long-term bond yields just hit the highest levels in decades. UK bond yields are near multi-decade highs. Global borrowing costs are rising everywhere at the same time. This puts the Federal Reserve in a very difficult position. If the Fed cuts rates too early, inflation can surge again. If it keeps rates high, borrowing costs continue crushing housing, businesses, consumers, and government finances. That is why rising yields become so dangerous late in a cycle. They slowly remove liquidity from the entire system. And today’s market is heavily dependent on AI stocks, mega cap tech, aggressive valuations, cheap refinancing, and speculative positioning. The exact same conditions that become vulnerable when yields keep rising. The 40-year yield chart now ends with a large red question mark at today’s levels. History shows markets usually ignore rising yields for a while. Until suddenly they cannot anymore.(Crypto Rover)