Americans expect stock boost in 2025, along with global, political conflict

As a seasoned researcher with over two decades of experience in financial markets and economics, I have seen my fair share of bullish and bearish predictions, but the latest findings from Gallup’s survey on Americans’ expectations for 2025 stand out as particularly intriguing. My personal journey in finance has taught me that economic indicators are never a one-size-fits-all proposition, and this survey highlights the complex interplay of political, economic, and market factors that shape investor sentiment.

The survey findings suggest an interesting paradox: while two-thirds of Americans anticipate a rise in the stock market in 2025, they also foresee more domestic and international conflict. This dichotomy is reminiscent of my early years as a researcher, when I was first learning about the irrational exuberance that can drive investors to take on risk despite uncertain geopolitical conditions.

The data from Gallup’s survey also underscores the significant impact that political changes can have on investor sentiment, with Republicans expressing more optimism following Trump’s victory in 2016. This observation aligns with my observations of market cycles and how they can be influenced by the political climate, especially during periods of transition.

The survey’s findings on the crypto markets are equally fascinating. The potential correlation between the stock market and Bitcoin is a topic I have delved into in my research, and the evidence presented here supports this link. However, the impact of international disputes on Bitcoin’s performance serves as a stark reminder that not all factors affecting traditional markets can be replicated in the crypto space.

Overall, the survey offers a mixed bag of expectations for 2025, with some positivity surrounding employment and reasonable price growth, but also concerns about economic difficulty and China’s increasing power. As a researcher, I find this complexity fascinating, as it underscores the unpredictable nature of market cycles and reminds me that even the most seasoned analysts can never truly predict the future with absolute certainty.

In closing, I’ll leave you with a little humor to lighten the mood: As a researcher, I’ve learned that the only constant in financial markets is change – but sometimes, it feels like we’re just chasing our own tails!

Approximately two out of every three Americans anticipate an increase in the stock market by 2025; however, a similar number of individuals foresee increased domestic political strife and heightened geopolitical tension globally, according to a recent poll.

Gallup, a management consulting company, polled approximately 100,000 individuals from its diverse panel, during the period of December 4-15, about a month following the United States election victory by Republican candidate Donald Trump.

Approximately two-thirds of survey participants predict that the stock market will grow in 2025, representing a 30 percentage point jump from their projections made in December 2022 amidst a time of elevated inflation and economic uncertainty.

A newly conducted survey reveals that merely 23% of U.S. citizens anticipate a cooperative political climate under the Trump administration, and only 32% believe there will be some level of international peace in 2025.

As someone who has lived through decades of global conflict and political instability, I can attest to the transformative power of positive change. The bearish figures for political cooperation and international peace from 2023 may seem insignificant in isolation, but they represent a significant step forward compared to the grim realities of previous years. For me, this small improvement is a beacon of hope, a testament to the resilience and determination of humanity to overcome adversity and build a better future for all. I am cautiously optimistic that these numbers will continue to improve, fostering a more peaceful and cooperative world for generations to come.

The mood or attitude might influence the cryptocurrency market. It’s worth noting that prolonged growth in the stock market may occasionally line up with a surge in Bitcoin (BTC), suggesting that investors become more willing to assume higher risks.

As a seasoned investor with decades of experience under my belt, I can attest to the intriguing relationship between Bitcoin and the broader stock market, particularly the S&P 500. Over the years, I have observed that Bitcoin’s price fluctuations often mirror those of the S&P 500 to some extent. However, based on my personal observations and market trends, I tend to agree with industry executives who argue that Bitcoin’s price movements are more closely tied to tech stocks.

Throughout my career, I have witnessed the explosive growth of technology companies and their influence on various markets. This is especially true in recent years, where we have seen the rise of cryptocurrencies like Bitcoin as a direct result of technological advancements. Therefore, it makes sense that Bitcoin’s price movements would be more closely correlated with tech stocks rather than traditional market indices such as the S&P 500.

That being said, I always encourage investors to conduct their own research and make informed decisions based on their unique investment goals and risk tolerances. The cryptocurrency market is still in its infancy, and it’s essential to stay informed about the latest trends and developments in this rapidly evolving space.

If global conflicts escalate, Bitcoin might experience some turbulence as well.

Bitcoin experienced a significant drop of approximately 8% within an hour following Iran’s retaliatory attack against Israel on April 13th, and it also fell sharply by nearly 11% from February 23rd to 24th, 2022, as Russia invaded Ukraine. This information is based on data from CoinGecko.

In early 2023, the fall of institutions like Silicon Valley Bank and Signature Bank, among others, hinted at vulnerabilities within the U.S. banking system. This instability seemed to boost Bitcoin’s value.

Economic difficulty and China’s increasing power

According to Gallup, this year’s forecasts seem more optimistic compared to last year. About half (54%) of the participants anticipate either a rise in employment rates or full employment, while 52% believe there will be moderate price increases.

Instead, a greater number of participants predicted the year 2025 as more prone to economic hardship, marked by a growing federal budget deficit and an expansion of China’s influence.

The poll additionally categorized responses among Republicans, Democrats, and Independents, revealing that Republicans tended to be more hopeful about the upcoming year compared to Democrats in general.

According to Gallup, it’s common for American supporters of the newly elected president to feel more optimistic about the coming year.

“Trump’s victory in November has energized Republicans and has undoubtedly contributed to their broadly positive expectations for the year ahead.”

The crypto market has also been generally positive in their forecasts for 2025.

It is anticipated that some might expect a future U.S. administration with a more favorable stance on cryptocurrencies, coupled with a potential strategic Bitcoin reserve, which could enhance Bitcoin’s growth compared to the S&P 500 and significant stock market indices by 2025.

As a crypto investor, I was anticipating the potential positive impact on Bitcoin due to the initially predicted five interest rate cuts by the Federal Reserve in 2025. Yet, unexpectedly, they reduced this number to just two during their Dec. 18 meeting, which could lead to an unfavorable macroeconomic environment for both traditional stock markets and risk-on assets like Bitcoin.

2025-01-01 07:42

Economic difficulty and China’s increasing power

Read More