Tremor - Macro Early Warning Signals - March 2026
Published: March 14, 2026
S&P down 5%. Nifty is already in bear territory - down 12% from highs. Micro-bear by my definition. 25% drop a mini-bear. 50% a full bear. Been through more than one of each - as a professional derivatives trader and investor.
S&P not there yet. But seems to be heading that way.
Several things coming together at the same time:
- CAPE - also called the Warren Buffett indicator - at 40-year highs
- Gold going vertical
- Crude shooting towards 2008 levels
- US delinquencies crossing COVID highs
When a whole bunch of these macro signals move together - that's what I call the tremors. The kind that come before a quake.
I've seen full bears. More than once. 2008 was the last one. Every time before it happened, it seemed improbable.
There are as many forecasts as there are experts - but my forecast is always 100% correct: goes up, down, or sideways.
I don't trade actively anymore. But the trader's mindset stays.
I have a setup ready for each.
An Entry. An Exit. A Stop loss. That's it.
Charts from tremor.tigzig.com
Tremor - Macro Early Warning Signals
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Where are we headed
Bond yields spiking
Consumer sentiment at one of lowest in past 20 years
Oil Remains high
US Q425 GDP growth revised downwards to 0.7%
US Unemployment & Non-Farm Payrolls flashing red
Bond markets pricing in high inflation expectation
US Past 20 Years
Past 6 Months
US Treasuries 10Y Yield
Germany 10Y Bund Yield
Institutional and bond desk expecting higher inflation. Which make the current yields unattractive, causing sell-off and consequential rise in yields. Becomes self fulfilling – the expectation itself create outcome in bond markets increasing risk to real economy CNBC – Rising European Yields, Bloomberg Podcast
US Feb’26 PPI annual inflation at 3.4%, higher than expected
US Past 20 Years
The producer price index is a measure of pipeline costs that producers receive for their products and an early indicator of consumer inflation. The annual inflation rate was at 3.4%, highest in past year. And the oil shock is yet to be baked in
Consumer sentiments running abysmally low
Michigan Consumer Sentiment results released March 27 came in at 53.3 amongst the lowest reading (7th lowest) in past 20 years
US GDP growth rate revised to 0.7%
The first revision of GDP on13th March 2026 was a 50% lower than the previous 1.4% and below Dow Jones consensus forecast of 1.5% CNBC (Seasonally & inflation adjusted Annualized QoQ growth rate)
Oil, unemployment and delinquencies in red zone
Brent continues to be above $100 and even when the Iran war ends and prices fall, the transmission won’t be instant. Some capacities may get online in months, others might take years. All while pressures continue on employment side and rising delinquencies.
Economists raising odds of a recession
Moody’s Analytics’ model has raised its recession outlook for the next 12 months to 48.6%. Goldman Sachs boosted its estimate to 30%. Wilmington Trust has the odds at 45%, while EY Parthenon has it at 40%, with the caveat that “those odds could rapidly rise in the event of a more prolonged or severe Middle East conflict.”
In normal times, the risk for a recession in any given 12-month span is around 20%. So while the current predictions are hardly certainties, they signify elevated risk.
“I’m concerned recession risks are uncomfortably high and on the rise,” said Mark Zandi, chief economist at Moody’s Analytics. “Recession is a real threat here.”
Reports CNBC March 25, 2026
US Shiller CAPE (Warren Buffett Indicator) is at its 2nd highest level ever and inching towards the highest seen during the dot com bubble
Gold touching new highs and orbiting the outer world
Past 20 Years
Crude nearly doubled since December and rapidly going towards 20 year high touched last time in 2008
US advance retail sales growth is on downward trajectory
US 30+ DPD has already crossed the COVID highs
Past 20 Years
US Unemployment creeping up steadily the past 2 years
Past 20 Years