Déjà Vu on Wall Street
The outlook for the market in 2025 is similar to that of 2018: robust performance concealing structural stress. Despite positive enthusiasm, both periods had stretched valuations, rate uncertainty, and rumors of a slowdown.
Rising Valuations, Fading Patience
In both years, equity valuations reached extremes while investors ignored warning signs. The difference? In 2025, AI-driven enthusiasm and post-pandemic liquidity have replaced the tax-cut optimism of 2018.
The Risk Behind the Rally
When the Fed tightened policy back in 2018, the fourth quarter fell apart. Delays in rate cuts, sticky inflation, and geopolitical pressure are today’s risks. Advisors should prepare their clients for a potential correction with caution rather than fear.
Lessons for Financial Professionals
Market déjà vu is a chance to refine discipline. Whether you’re an RIA, securities lawyer, or broker-dealer, risk management and transparency remain timeless.
