Frothy Markets Bring Frothy Projects

 11/7/2025

 

Frothy Markets Produce Frothy Projects

 

Social Mood theory holds that bigger than ever projects are planned or occur amid market manias.  The Empire State Building was planned in 1928-29. It opened in 1931 amid the worst real estate market in decades. It was not profitable until the next bull market of the 1950s. So here we go again.

·      The 2026 Cadillac Blackwing (we are not yesterday’s Cadillac) features a  666 BHP supercharged engine capable of 205 mph. Just the thing to get one to the HEB in record time. Brembo brakes and carbon fiber touches abound.  This is an echo of the Auburn Cord Duesenberg autos of the 1920s.

·      San Antonio voters approve a $1.1 billion new arena for the Spurs basketball team. That will make two 15,000 seat venues in SA, the Spurs play a mere 40 days a year there.

·      Construction on the Jeddah Tower, the first one kilometer tall building ever, resumed in January 2025. Construction halted in 2018. Completion is slated for 2028.  This is ironic given no lack of open real estate in Saudi Arabia.

·      A mew version of Frankenstein premiers Friday. This is an echo of  1973’s The Exorcist, billed as the most horrifying movie ever. It was a box office smash.

Evidence mounts that the stock markets peaked October 29. That too is an echo of October 29, 1973. Then the markets made revisited the old high on narrow breadth. Panatir trades at 200x time earnings. The Big Short investor Michael Burry has a $1.1 B short bet on Nvidia and Palantir, the current AI stars of the tech driven market.  It will be interesting to see how that works out.

In recent days the NASD made a new high while twice and many of tis stocks were down rather than up.  I believe we are seeing a repeat of the 1973-74 50% drop in the markets. No one believed it then either. But political polarization, overseas war, inflation then as now, then as now all look eerily familiar.

OPEC is dropping crude oil prices in Asia while increasing output.  Oil briefly traded above $65 September 25. This morning it is just below $60. Low oil prices are a symptom of a declining economy with less demand for energy.  The fact that gasoline prices are lower is not a positive. 

Meanwhile Rick Perry launches Fermi. Fermi is engaged in natural gas projects and eventually plans nuclear reactors in the Texas Panhandle.  Fermi has no earnings to date. Another winner or a bust at the top.

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