Perma Bull Chronicles: Trends, Optimism, and Smart Moves
March 1, 2025
History doesn’t repeat, but it rhymes—and ignoring market cycles ensures financial ruin. Extreme sentiment, whether blind optimism or relentless pessimism, is the Achilles’ heel of most investors. Those who learn to balance optimism with scepticism consistently outperform those who swing between panic and euphoria.
Mass Sentiment: The Market’s Fuel
Pessimism dominates. For months, neutral and bearish sentiment has outpaced bullish sentiment despite record-breaking market rallies. The average investor isn’t embracing new highs—they’re resisting them. This disconnect fuels further gains. Markets climb a wall of worry, not a staircase of confidence.
Historical data supports this:
- AAII Sentiment Survey: Bearish sentiment has exceeded its historical average for nearly two years, while bullish sentiment has struggled to reach its mean.
- Put/Call Ratios: Fear-driven hedging activity remains elevated, signalling hesitation rather than euphoria.
- Cash Holdings: Institutional investors and funds continue to hoard cash, waiting for the perfect entry. That hesitation is the market’s rocket fuel.
The Federal Reserve: Master of Market Psychology
The economy is held together by stimulus, low rates (historically), and manipulated data. But fighting the Fed? That’s a losing battle. Since 2009, every major market correction driven by rate fears or economic “doomsday” scenarios has been reversed through intervention. Betting against this reality has cost bears trillions.
Yes, the Fed’s policies create distortions, and yes, markets are fueled by liquidity rather than fundamentals. But trends are trends, and reality doesn’t matter until it does. Market participants who focus on “what should be” instead of “what is” have historically missed the biggest runs.
Technical Analysis: The Numbers Don’t Lie
From a technical perspective, the trend is clear:
- S&P 500 consistently trades above key moving averages (50-day, 200-day).
- MACD confirms upward momentum, with bullish crossovers providing repeat buying opportunities.
- Volatility spikes align with buying zones as the crowd panics into selling pressure.
Markets will correct—they always do. But waiting for the “perfect” pullback has left many sitting on cash while the market grinds higher.
The Key Psychological Trigger: Fear vs. Euphoria
A true market top isn’t formed by technicals alone—it’s formed by euphoria. That’s missing today.
- Our proprietary “Anxiety Index” confirms the public has remained in a state of fear, never shifting to the “calm” zone.
- Retail investors remain skeptical, not euphoric.
- Financial media continues to push crash narratives, not celebratory headlines.
The greatest risk isn’t being in the market—it’s being out of it. The trend remains bullish, fear still dominates, and historical data shows that major tops form when the masses embrace risk—not when they reject it.
Until sentiment shifts toward full-fledged euphoria, pullbacks are buying opportunities, not warning signs.
Perma Bull Persists: The Market’s Illusionary Drive Continues
The Federal Reserve and corporate giants understand a fundamental truth—there is no real economic recovery. This market isn’t built on fundamentals; it’s fueled by hot money, artificial liquidity, and psychological conditioning. The moment liquidity injections cease, the Perma Bull narrative collapses. This is precisely why the Fed remains committed to its grand illusion—propping up markets at all costs.
The “New Normal” is Manufactured Illusion
The masses have fully embraced the fantasy. Decades of psychological conditioning have made it easier to believe “sweet lies” than confront financial reality. The media perpetuates this illusion by manipulating statistics, crafting fear-based narratives, and misrepresenting risk. But fear is a tool—it ensures the majority remain reactionary participants rather than strategic investors.
The Market Will Correct—But It’s Not Over Yet
Yes, corrections are coming. Sharp pullbacks are inevitable. But the game isn’t over. The “inflate to infinity” era is still in its early stages, and when the Fed eventually shifts to negative interest rates, markets will explode to levels even die-hard bulls struggle to imagine.
- Fear-driven corrections create opportunity. Every sharp decline is a buying zone until true euphoria takes hold.
- Liquidity remains the dominant force. As long as the Fed injects capital, markets will defy economic logic.
- The crash will come—but not yet. The final phase of this bull run will stretch valuations into the stratosphere before gravity asserts itself.
The Federal Reserve Holds the Ultimate Power
Pessimists cling to the idea that markets must crash because fundamentals say so. But markets don’t move on logic alone—they move on liquidity and mass psychology. The Fed’s influence dwarfs that of any expert forecasting doom. Until sentiment shifts from fear to greed, the trend remains intact.
Final Thoughts: The Unstoppable Force Meets the Unyielding Illusion
The Perma Bull narrative isn’t built on fundamentals—it’s engineered through liquidity, psychological conditioning, and outright manipulation. Every time logic dictates a market collapse, the Fed rewrites the rules. Bears screaming about overvaluation fail to grasp a crucial reality: markets are no longer driven by free-market principles but by unprecedented central bank intervention.
The era of “inflate to infinity” is only getting started. When the Fed inevitably adopts negative interest rates, markets will catapult to levels that even today’s bulls would dismiss as absurd. Consider Japan—the Bank of Japan has pushed rates negative for years, monetizing debt and propping up equity markets despite dismal economic growth. The U.S. is headed down the same path, except with far greater global influence and a deeper liquidity engine.
The Crash Will Come—But Not Yet
Corrections are part of the game, but a final, catastrophic crash won’t arrive until mass euphoria grips the market. That hasn’t happened yet.
- Current sentiment remains fearful. Even as markets make new highs, retail investors are sitting on record cash levels, still traumatized by past downturns.
- Institutions are still buying. Corporate buybacks, sovereign wealth funds, and central bank interventions continue to support the market.
- Retail investors remain sceptical. Bearish sentiment has consistently outpaced bullish sentiment, proving the market’s climb still has fuel.
Those waiting for a crash now will be left behind as markets grind higher. But make no mistake—when mass greed finally takes over, the unwinding will be violent.
What’s the Smart Play?
- Use pullbacks as buying opportunities. Every sharp decline will be met with liquidity injections—until it isn’t. Ride the wave, but stay alert.
- Diversify nto tangible assets. Gold, silver, and real assets are essential insurance against monetary debasement.
- Watch for sentiment extremes. The real danger isn’t when markets are overvalued; it’s when the masses finally believe they can’t fall.
The Fed isn’t omnipotent, but its influence is unmatched. Fighting the trend prematurely is financial suicide. Recognize the game, play accordingly, and be ready to exit when the tide finally turns. Until then—ignore the noise, focus on the trend, and profit from the illusion while it lasts.
Originally published in August 2016, this article has been updated over the years, with the latest revision on March 1, 2024. Those who followed our insights into gold, AI, and Bitcoin profited handsomely, while our subscribers did even better with specific stock picks in the PM sector.
The Perma Bull illusion persists, driven by liquidity and psychological conditioning. The crash will come—but not yet. Until then, exploit fear, follow sentiment, and ride the wave while it lasts
