Ed Yardeni Raises U.S. Market Meltdown Odds To 35%, Bitcoin Could Face Deeper Drop

Ed Yardeni has sharply raised his estimate that the U.S. stock market could experience a full 'meltdown' this year to 35% (up from 20%), while downgrading the odds of a 'melt-up' to just 5%.

“Bitcoin could face deeper downside as odds of U”

@coindesk

He explicitly tied the revision to rising geopolitical risk linked to the Iran conflict and to a jump in oil prices above $100 per barrel, saying the persistent oil shock and related tensions could force difficult trade-offs for the Federal Reserve.

@coindesk

Yardeni's reassessment frames the current macro picture as one where higher energy-driven inflation risk and geopolitical escalation materially raise the chance of a severe equity rout.

Markets have already shifted into a defensive posture.

The Bloomberg Dollar Spot Index is up roughly 2% since the conflict began.

CoinDesk

Global equity benchmarks have dropped: the S&P 500 fell about 2% last week and MSCI global equities were down about 3.7%.

Futures trading showed sharp downside moves, with S&P futures sliding more than 2% in Asian hours.

Volatility spiked as the VIX hit its highest level since April.

Hedge funds reportedly boosted short positions.

These are classic signals of a risk-off stance that mirror Yardeni’s elevated meltdown probability.

Fixed‑income and policy expectations have adjusted alongside equities.

“Iran war raises risk of US stock market meltdown, Ed Yardeni warns”

Invezz

Bond markets began pricing greater inflation risk, with 10‑year Treasury yields rising about six basis points.

Market bets on the timing of Fed rate cuts have moved out—investors pushed expected cuts from July to September and some traders now see no cut this year.

Those moves underline Yardeni’s warning that an oil‑driven inflation shock complicates the Fed’s trade‑off between fighting inflation and supporting employment.

Bitcoin's price behavior shows mixed market dynamics: BTC held near about $67,000 and was roughly flat on the week despite sharp drops in global equities, rising volatility and oil topping $100 per barrel.

NYDIG analysis cited in coverage finds that only about 25% of Bitcoin's price moves are explained by correlation with equities, implying most movement is crypto-specific.

CoinDesk

That observation suggests Bitcoin has held up better than it arguably "should" given the broader risk-off environment, though it remains vulnerable to equity contagion during a deeper market meltdown.

Despite the short-term risks Yardeni highlighted, he remains relatively bullish on the longer horizon: he assigned a 60% probability to a "Roaring 2020s" outcome through year-end and an 85% chance over the next decade, while warning that rising stagflation expectations could quickly flip market sentiment into a sustained bear run.

“Bitcoin could face deeper downside as odds of U”

CoinDesk

That combination (heightened near-term odds of collapse but continued longer-term upside probabilities) captures Yardeni's dual view that transitory shocks can be severe yet the underlying long-run upside story remains intact.

@coindesk