Zhihu Analysis: When Will the US Stock Market Crash?

Original author: Zhihu @alex01 Source: https://www.zhihu.com/question/1966760869158446468/answer/1970310205041545577

What the Author Says

  1. This is the biggest bubble in human history, but it hasn’t peaked yet
  2. Don’t short based on news (like Michael Burry shorting NVDA/PLTR) — it’s a trap
  3. Crash prerequisite: TLT must break below 74; until then, no real crash
  4. Pre-crash targets: Nasdaq 32,800+, S&P 500 11,000+, Shanghai A-shares 8,100+, Gold $6,000/oz
  5. Post-crash: Gold crashes from $6,000 to $800, completing within months

My Assessment

What’s Right

“Don’t short based on news” — This is gold. Burry’s NVDA/PLTR short is all over the news; retail investors following him to short are giving away money. Short positions are fuel for longs; markets need volatility to distribute. He’s spot on here.

“TLT is a key indicator” — Has some merit. TLT (20+ Year Treasury Bond ETF) breaking below 74 would mean long-end yields surging out of control — genuinely a systemic risk signal. Currently TLT is around 85-88, still has room before 74.

“Hedge fund defensive positions at historic lows” — Charts show hedge fund net delta near historic lows, meaning institutions aren’t hedging heavily. This is indeed a “market hasn’t reached panic stage” signal.

Pure Speculation

“Nasdaq 32,800+, S&P 500 11,000+” — No derivation whatsoever. Nasdaq currently ~19,000, needs to rise 73% to 32,800? S&P currently ~5,900, needs to rise 86% to 11,000? The author drew a few charts and threw out these numbers with no valuation model, no earnings forecasts, no liquidity analysis.

“Gold $6,000 then crashes to $800” — Gold going from $6,000 to $800 is an 87% crash. The 2008 financial crisis saw gold’s maximum drawdown of only 28%. $800 is 2018 price levels. Zero logic supports this number.

“Shanghai A-shares 8,100” — Currently ~3,300, needs to rise 145%? No reasoning given.

Fatal Flaw

The entire article has zero data verification. All chart line-drawing + “I think” + “mathematical projections.” The so-called “mathematical projections” link to the author’s own articles, essentially Fibonacci + Elliott Wave + subjective judgment.

The indicators he cites are correct (TLT, Fed balance sheet, IWM), but the conclusions drawn from them (32,800, $6,000, $800) have no logical chain.

Verdict

3/10. The core advice of “don’t short based on news” is valuable, and TLT as a crash prerequisite indicator has reference value. But the price targets are pure speculation with zero data support — “gold $6,000 crashing to $800” is absurd. The danger of this type of article: correct framework wrapping wrong conclusions, making readers feel the “logic flows” and then believe the unsupported numbers.

What’s worth noting: TLT breaking below 74 as a systemic risk signal. What to ignore: All price targets.