The financial community pays attention to what Goldman Sachs has to say. Three investment opportunities are identified in their recently released 2025 macro forecast report: U.S. exporters, bonds, and crude oil. Let’s first inquire whether these are real insights or a calculated move to strengthen their own portfolio before delving into their selections.
Do Stocks Have Too Much Value? The Demand for Bonds by Goldman
According to Goldman, bonds—more especially, the iShares 20+ Year Treasury Bond ETF (NASDAQ: TLT)—are the best option. Their logic? Bonds are a safer option because stock values are stretched thin. They see the current gap between bond yields and S&P 500 yields as proof that stocks are overpriced.
Here’s the worst part, though: Major commercial actors, including prime brokers and large banks, are shorting S&P 500 futures at levels not seen since 2007, according to Goldman’s study. In the meantime, holdings of 10-year Treasury bonds are increasing. Is this a warning sign for stocks or a cunning move to encourage bond purchases? As usual, Goldman’s motivations are still up for debate.
The study doesn’t say, “Buy bonds now,” directly.but dissecting their language makes it clear. Their analysis suggests that mispriced opportunities lie in today’s bond yields, particularly given anticipated GDP growth rates and inflation levels in 2025. It’s a compelling argument, but also one that serves their narrative.
Crude Oil Could Be 2025’s Commodity Darling
Goldman has always had a fascination in commodities, but this time they are focusing on crude oil. The paper claims that there are “supply shock tail risks” for oil, which simply implies that if supply tightens, prices could rise. Their choice? NYSEARCA: XLE is the Energy Select Sector SPDR Fund.
Why the assurance? Warren Buffett has made purchases. He currently owns close to 29% of Occidental Petroleum (NYSE: OXY). Additionally, J.P. Morgan Chase has invested $730.8 million in the energy exchange-traded fund. What about hedge funds? In anticipation of a price breakout, they are placing large bets on oil futures.
Goldman’s reasoning is straightforward: oil has a higher potential for risk-reward than other commodities like gold.
Although concerns about inflation have caused gold to command a premium,and geopolitical tensions, its appeal is cooling off. Oil, on the other hand, seems poised for growth. But let’s not ignore the obvious: Goldman’s push for oil aligns neatly with current hedge fund positioning. Coincidence or calculated strategy?
Investing in American Exporters: A Decline in the Dollar?
The emphasis on currency concerns in Goldman’s study is its most unexpected feature. According to their forecast, the U.S. currency may depreciate in 2025, which would favor developing market stocks and American exporters. The Industrial Select Sector SPDR Fund (NYSEARCA: XLI) is useful in this situation.
The reasoning is straightforward: a declining currency increases exports by making American goods more affordable overseas. According to the most recent PMI survey, Goldman notes that manufacturing orders have increased to their greatest level in 26 months. Businesses in the industrial sector stand to gain greatly from this export boom.
But there’s also a degree of cynicism to take into account. Notable Wall Street holdings in industrial stocks align with the report’s focus on exporters.
Is this an objective prediction or another example of “talking their book” to encourage a narrative that serves their investments?
Is Goldman’s Outlook Reliable?
On the surface, Goldman’s suggestions seem sense: exporters for a dollar-driven boost, oil for growth, and bonds for safety. However, there are concerns about the report’s timing and compatibility with institutional perspectives. Are they calculated actions intended to help the bank and its affiliates, or are they real opportunities?
“A lot of what has been said in the bank’s 2025 macro outlook report is not what it seems,” the report itself states. It would be prudent for investors to proceed cautiously with these forecasts, examining the facts in greater detail and taking the market’s overall dynamics into account.