While most Wall Street analysts are trapped in cautious observation, Tom Lee of Fundstrat, with his unique interpretation of macro signals, has drawn a completely different treasure map for investors.
In an environment where most analysts hold a cautious or even pessimistic view of the market, Tom Lee—Chairman of BitMine and co-founder of Fundstrat—has once again attracted market attention with his contrarian bullish stance. As one of Wall Street’s most outspoken bulls, Lee accurately predicted the market rebound from 2023 to 2025.
In a recent in-depth interview, he systematically explained his unique insights into the current macro cycle, the AI supercycle, and the trends of crypto assets, pointing out that investors are missing out on historic opportunities due to misjudgment of key signals.
I. Contrarian Thinking: Why Are 90% of Analysts Wrong?
Facing the pervasive pessimism in the market, Tom Lee sharply pointed out the core of the problem: 80% of trading essentially depends on the macro environment, and over the past three years, investors have almost all considered themselves “macro traders,” yet made two key mistakes.
● “An inverted yield curve does not necessarily signal a recession,” Lee explained. “This time, the inversion is due to inflation expectations—short-term inflation is high, so short-term nominal rates should be higher, but in the long run, they will fall. That is the real reason for the curve inversion.”
● Lee believes that our generation has never truly experienced inflation, so everyone uses the ‘stagflation’ of the 1970s as a template, without realizing that today’s conditions do not have the persistent inflationary challenges of that era.
The “tariff crisis” in April was a typical case. When most economists declared a recession was coming, institutional investors traded accordingly, essentially preparing for a massive bear market. “Such mistaken positioning cannot be adjusted in just six months,” Lee pointed out, “yet the market rebounded strongly, supported by corporate earnings.”
II. The Engine of the Supercycle: Overlooked Structural Forces
Tom Lee repeatedly emphasizes that the most misunderstood concept in the current market is the “supercycle.” As early as 2018, he identified two future supercycle drivers, which are now coming into play.
● The millennial generation entering their prime working years: This group is at the peak of their earning and spending power, creating a 20-year economic tailwind.
● Global shortage of prime-age labor: This seemingly mundane factor actually lays a solid foundation for the AI boom.
Lee compares the current AI-driven boom to similar historical periods: “From 1991 to 1999, there was a labor shortage and tech stocks boomed; from 1948 to 1967, there was also a labor shortage and tech stocks prospered. The current AI wave is repeating this pattern.”
III. The Explosive Potential of US Stocks and Crypto Assets
Despite the strong rally the market has already experienced, Tom Lee remains optimistic about the year-end outlook. He predicts that the S&P 500 could reach 7,000 or even 7,500 points by year-end and points out three major potential opportunities.
● AI trading will make a strong comeback: Although there has been some recent wavering, the long-term outlook for AI remains unaffected, and companies are expected to make major announcements when looking ahead to 2026.
● Financial stocks and small caps: If the Federal Reserve cuts rates in December, confirming the start of an easing cycle, this will be extremely positive for financial stocks and small caps.
● Cryptocurrencies: Cryptocurrencies are highly correlated with tech stocks, financial stocks, and small caps, so they are set for a major rebound.
Lee particularly emphasized: “The market has performed strongly over the past six weeks, but people’s positions are seriously offside, which means the potential demand for stocks is huge. 80% of institutional fund managers are underperforming the benchmark index, the worst performance in 30 years. They only have 10 weeks left to catch up, which means they will have to buy stocks.”
IV. Ethereum’s Explosive Potential Far Exceeds Bitcoin
In the crypto space, Tom Lee offers a view different from the mainstream. He believes bitcoin has the potential to reach the hundreds of thousands by year-end, possibly even $200,000.
● But he said: “For me, it’s more obvious that Ethereum could see huge gains before the end of the year.”
● Lee analyzed that stablecoins and tokenized gold are eating into bitcoin demand, and these all run on smart contract blockchains like Ethereum. In addition, Wall Street is actively positioning, with BlackRock CEO Larry Fink hoping to tokenize everything on the blockchain.
● “Fundstrat’s head of technical strategy, Mark Newton, believes that by January next year, Ethereum’s price could reach $9,000 to $12,000. I think this forecast is reasonable, which means Ethereum’s price could more than double from now until the end of the year or January next year.”
V. Overestimated Inflation and Geopolitical Shocks
Among the many market risks, Tom Lee believes that the “return of inflation” is the most overestimated.
● “Too many people think monetary easing or GDP growth will create inflation, but inflation is a mysterious thing,” Lee analyzed. “We’ve had years of loose monetary policy without inflation. Now, the labor market is cooling and the housing market is weakening. The three main drivers of inflation—housing, labor costs, and goods—none of them are rising.”
● As for geopolitical risks, Lee also believes their impact is overstated. He gave an example: “This summer, the US bombed Iran’s nuclear facilities. Some predicted oil prices would soar to $200, but in the end, oil prices barely moved.”
● “Geopolitics can destroy unstable economies. But in the US, the key question is: will corporate earnings collapse due to geopolitical tensions? If not, then we shouldn’t use geopolitics as the main reason to predict a bear market.”
VI. How to Seize Opportunities Amid Volatility
In response to the current market environment, Tom Lee offers practical advice for investors.
● He emphasizes that when investors sell stocks, they actually need to make two decisions: first, to sell, and second, when to re-enter at a better price. If you can’t ensure you can tactically re-enter, panic selling may cause you to miss out on long-term compounding returns.
● For investors who have already missed market opportunities, Lee suggests gradually returning to the market through a “dollar-cost averaging” approach, rather than investing all at once. Divide investments over 12 months or longer, investing a fixed proportion each month. This way, even if the market falls, you can achieve a better cost advantage by buying in batches.
● Lee especially reminds investors to avoid falling into the trap of “waiting for a correction”: “Peter Lynch said, ‘More money has been lost waiting for corrections than in the corrections themselves.’ This kind of emotional stubbornness often stems from a lack of conviction, not rational judgment.”
