Market View: November-December 2025

By Argent Wealth Management, LLC on November 13, 2025

Conclusions

Stocks remain in a bull market.
- Recession odds are low.
- Corporate earnings are strong.
- The consumer remains healthy.
Tariffs are less impactful than the media would lead us to believe.
AI is not in a bubble, and many still underestimate its impact and growth.
Gold is overextended, but likely remains in a bull market.
Risks remain and are reviewed below.

Fed Policy, Macro Trends, and Corporate Earnings

The Fed is in an easing cycle. This tends to be beneficial for stocks. If the economy does worse than expected, the Fed will ease faster than expected. Lower interest rates support consumption and investment. If the economy does better than expected, the Fed will ease slower than expected, but that is supportive of stock prices as it means consumption and investment is already resilient enough to keep GDP growing.

The Fed has a dual mandate to keep unemployment healthy and inflation in check. The Fed is currently more focused on the unemployment side of the dual mandate as inflation has stayed steady.

This is despite the fear of the impact tariffs may have on inflation. There is no doubt tariffs have some impact on inflation; however, they are less than the media or many expect.

Tariffs

The American Enterprise Institute estimates that over 95% of imports could be considered intermediate goods or inputs to final goods. Final goods sell for well more than the price of inputs. Consider a pair of Nike Shoes, which might sell for $110 but are imported for ~$20-25.

Moreover, according to the San Francisco Fed, only about 11% of U.S. consumer spending goes to imported goods and services after adjusting for intermediate inputs.

About 89% of spending goes to domestically produced goods and services. In 2024, imported goods and services made up 14% of GDP. Keep in mind, ~80% of U.S. GDP is comprised of services, with most of that figure coming from non-imported services.

In conclusion, although tariffs have an impact on prices, the data indicates they won’t drive inflation nearly as much as aggregate demand, which stems from consumer and business health. This is potentially why Powell and the Fed are focused more on employment risks.

The Consumer and Employment

One of the first signs that the consumer is weakening would be a quick rise in credit card delinquencies. They are trending down as of late.

Although unemployment has risen from ~3.5% to 4.3%, there are still signs the job market remains more healthy than unhealthy. For example, there remains close to 1 job opening per unemployed worker. Wages are growing 4.1% a year, which is hardly an indication that companies expect to lay off workers en masse.

The softening of the job market, and the difficulty some have finding a job may be due to the AI revolution.

Artificial Intelligence

The AI revolution is likely in the second or third inning. The advance of large language models continues. Artificial General Intelligence, the ability for models to reason and learn on their own, is likely a few years away.

Like with any breakthrough in technology, frictional employment can occur. The mass adoption of computers led many to believe jobs would be lost. Some were, and AI is and may continue to cause some job losses. However, technological advancement through history has increased GDP per capita, i.e. living standards, over time. Technology creates more efficiency and economic growth. Those that lose jobs need to retrain to areas where economic growth is.

Consider the fact that in 2025 Meta, Amazon, Alphabet, and Microsoft alone invested over $320 billion in AI technology and infrastructure, up from $230 billion in 2025. UBS believes this was only about 58% of spend on AI in 2025. AI investment is expected to grow around ~30% compounded annually in the next five years. It is not just a technology story. It is changing content creation, coding, customer service, healthcare diagnostics, administrative efficiency, fraud detection, customer insights, automation, infrastructure, government operations, and national defense to name just a few industries.

Many fear AI might be in a bubble. However, unlike the dotcom boom, the biggest investors in AI-related functions are large companies with strong balance sheets and earnings. “ARTY”, the iShares Future AI & Tech ETF is trading at around 26x next twelve months expected earnings. This valuation is not indicative of a bubble.

ChatGPT, which kicked off the AI chatbot boom, is generating about $10-12 billion in annual recuring revenue. Their service is only used by 7.7 million individual accounts, plus about 2 million enterprise users. This is likely to 10x in Argent’s opinion over the next few years. ChatGPT alone may have well over $100 billion in revenue by 2028.Competitors like xAI and Google will also grow tremendously.

It isn’t just AI companies doing well. Globally, earnings estimates are going up, which is historically bullish. About 75% of earnings estimates have been revised positively over the last 60 days, and about 70% of earnings have been revised positively over the last 280 days.

Risks

A continued prolonged government shutdown would add to uncertainty and fear.
Supreme court challenging tariff policies could change the geopolitical landscape. Whether investors view this as positive or negative is uncertain.
- More likely to be negative near term due to increased uncertainty over how the Trump administration will operate without Tariff policy.
Uncertainty over other foreign nations’ policy towards us.
The stock market overall is not inexpensive. A correction to pull back valuations would not be surprising.

The biggest long-term risk is that investors are now overallocated to stocks. While a correction is likely near term, the risk of a prolonged bear market is small given low recession odds and rapid technological advancement. Over the next ten years, investors need to be aware that returns may not be as good as in the last 10 years. The average investor equity allocation is over 50%. Historically, when above 50%, overall returns over the next 10 years are weak.

There are two offsetting factors that may change history’s tale. First, the average age of millennials is approaching 40. Millennials make up about 22% of the population and are entering into their accumulation years, as incomes rise and households begin to form. Gen Z makes up about 20% of the population, and about half are likely already working. Combined they are 42% of the population. Their 401ks are consistently buying more stocks every paycheck with no end in sight. Second, AI and the technological revolution could drive more growth than expected for years to come.

During long-term bear markets, a more tactical and diversified approach to investments is needed to maximize returns. This would include using real assets like gold and commodities and moving more quickly from stock allocations to alternative allocations such as real assets or bonds. A buy and hold approach would not suit investors as well as it has in the last 15 years.

Gold

Near-term, Gold is overextended. However, it may be in a long-term bull market.

Gold tends to go through long-term bear and bull markets, and cyclical bear markets can last a long time.

Gold tends to do well as an inflation hedge, in unstable geopolitical environments, and when the dollar is weakening. About 40-50% of gold is used in jewelry. Some is used as an input to other products, but about 50% is simply used as a store of value. It is a scarce, real asset that cannot be destroyed. Therefore, it has value. However, value is simply determined by the price individuals are willing to pay. Therefore, it is difficult to value.

Currently, gold is 19% of official government reserves, up from about 16.5% in 2023. Part of the reason it has risen is likely due to government purchases. Governments likely view it as a neutral asset that can be exchanged for any currency at any time. Persistent buying by large countries like China can elevate the price quickly. Even at $4000/oz, the total value of all gold in existence is $28 trillion, less than the GDP of the U.S. This can make the price sensitive to consistent heavy buying. When investors see governments buying consistently, it is a sign they should buy as well, and this cycle can quickly change the price of gold.

As with any asset, if it can go up 100% in two years, it could go down 50% just as easily. However, that is not the base case. Gold is likely to consolidate and continue a long-term upward trend.

Governments are likely to continue buying as they try to move away from the dollar. Foreign governments do not want to rely as much on the U.S. dollar as it gives the U.S. power to sanction them more. Gold can’t be sanctioned.

The U.S. Dollar will likely remain the reserve currency. Rule of law, property rights, innovation, and relative freedom make it a destination for many around the world to live and invest. It is unlikely we are seeing the start of a long-term bear market in the U.S. Dollar.

However, many governments would prefer the U.S. to have less power than it has, even if it is only slightly less power, it is better than slightly more power.

Note the U.S. owns more gold than any other country in the world. The increase in the price of gold helps the value of the U.S. balance sheet.

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