The 3rd Month

The Third Month

Whatever the reason, earth-shaking and market-moving events have a way of happening during the month of March.

We touched on this phenomenon briefly last week: COVID lockdowns hit in March of 2020, sending the market on its steepest plunge in decades — only to be rescued that same month by a tsunami of Federal Reserve funny money.

More recently, Silicon Valley Bank flamed out in March of 2023 — the signal event in a cascade of bank failures that spring, both in the United States and overseas.

Looking further back in time, March 2000 marked the peak of the dot-com bubble. The Nasdaq began a grueling 78% downard grind that didn’t end until late 2002.

Including today, nine trading days remain in March 2025. Plenty of time for something big to go down.

While Wall Street and the financial media obsess over whatever the Federal Reserve does later today… Paradigm’s own Mason Sexton says something much, much bigger is in the cards tomorrow.

Late last year, when this market veteran of 45 years’ experience joined our team… he was already laser-focused on tomorrow, March 20, 2025. He said it could prove to be “the most significant date of the first quarter.”

Simply put, he anticipates a market disruption that could alter the course of Donald Trump’s presidency — as high-impact an event as his two impeachments and two assassination attempts.

How could Mr. Sexton pinpoint one date with so much confidence, more than three months out?

Well, the same way he pinpointed the Black Monday crash in 1987… the 2008 financial crisis… and the 2020 COVID crash. Top hedge funds paid him upwards of $10,000 a month for access to those forecasts.

But what’s coming tomorrow could be of such magnitude that he wants to get his warning out to a wider audience of everyday Americans.

Readers of his premium advisory The Map are already prepared for whatever’s coming. Are you? Click here to learn why tomorrow is so important — and what you should do to get ready.

“We’re Gonna Need a Bigger Power Grid”

Perhaps the biggest takeaway from Nvidia CEO Jensen Huang’s annual presentation to software developers has to do with AI’s impact on the power grid.

It’s a story we’ve been onto since early 2024 — months before the tech giants like Microsoft and Amazon began to embrace nuclear power so they could have a reliable, always-on source of juice for their power-hungry data centers. Even so, the grid just can’t keep up with AI’s prodigious demands.

If the tech industry was hoping for relief from Nvidia’s next generation of chips, it came away from yesterday disappointed.

From the Reuters newswire: “A promising new chip technology that aims to cut energy usage is not yet reliable enough for use in Nvidia's flagship graphics processing units (GPUs), Nvidia's CEO Jensen Huang said Tuesday.

“Co-packaged optics, as the emerging technology is called, uses beams of laser light to send information on fiber-optic cables between chips, making connections faster and with superior energy efficiency to those through traditional copper cables.”

That’s especially bad news because Huang says that relative to expectations a year ago, the world will need 100 times as much computing power for advanced AI.

A bold number, but Paradigm analyst Davis Wilson thinks it’s on the mark: “Reasoning models, which ‘think’ through complex problems step-by-step, and AI agents, designed to autonomously handle tasks like booking flights, aren’t lightweight innovations.

“They generate massive datasets and require blazing-fast processing to deliver timely results.”

Or as Huang put it yesterday, “Users won’t want to wait 10 times longer to get an answer that relies on 10 times more data.”

All in all, Davis came away impressed with Huang’s presentation, even if co-packaged optics still aren’t ready for prime time.

“Nvidia unveiled an upgraded Blackwell Ultra chip, set to launch later in 2025,” Davis writes for our sister e-letter The Million Mission. “This is the newest version of Blackwell which has already hit full production and raked in $11 billion in Q4 revenue.

“Huang then dropped the bombshell of the Rubin AI superchip, slated for mid-2026, boasting over three times the Blackwell Ultra’s power, with an even mightier Rubin Ultra variant to follow in 2027 offering 14 times Blackwell’s performance.

“Named after astronomer Vera Rubin, this road map signals Nvidia’s intent to dominate AI compute for years to come.

“Analysts project the Rubin series alone could generate $40 billion in its first year and $95 billion in its second — numbers that dwarf the annual revenue of most S&P 500 companies.”

NVDA sold off 3% during and after Huang’s talk yesterday, caught up in a general market downdraft. Some of that loss has been recovered this morning, but Davis says Nvidia still looks like a relative bargain. Its price-earnings ratio is basically the same as the entire S&P 500.

“This valuation is dirt-cheap for a company that’s growing as fast as Nvidia is.”

About Those “Robust” Retail Sales

No major economic numbers today, but it’s worth following up on a number we mentioned Monday.

Monday was when the retail sales report came out from the Census Bureau. Once you factored out volatile auto sales and falling gasoline prices, the number was just fine — a month-over-month increase of 0.5%, in line with Wall Street’s expectations.

We also mentioned that these numbers are not adjusted for inflation. Over time, that lack of adjustment can start to distort the real picture.

The real picture comes courtesy of a chart from the folks at Statista.

Note the green line. Adjusted for inflation, we see that retail sales are on a generally higher trajectory than they were in pre-pandemic years… but for all intents and purposes, they’re ruler-flat since the last of the “stimmy” checks went out in 2021.

“Between February 2022 and 2025,” writes Statista’s Felix Richter, “monthly retail and food services sales (adjusted for seasonal variations, holiday and trading day differences) increased by 11.1%. Adjusted for CPI inflation, sales actually declined by 1.1%.”

So much for the mighty American consumer, huh?

For once, the major U.S. stock indexes are not treading water ahead of a Federal Reserve announcement.

Usually Mr. Market bides his time every six weeks on Wednesdays until the Fed issues its proclamation at 2:00 p.m. Eastern and chair Jerome Powell holds his press conference.

Not today: All the major indexes are solidly in the green, the S&P 500 up two-thirds of a percent to 5,651. (For perspective, that’s down 8% from its record close one month ago today. On the other hand, 5,651 was a record last July.)

Gold, however, is treading water at $3,030 and silver is losing ground at $33.57.

Bitcoin is making another run toward $85,000 — but we’ve been here before in the last week and a half.

Energy Quietly Breaks Out

The oil price has bounced around between $65–68 all month — but under the surface, “the energy sector is daring you to buy,” says Paradigm chart hound Greg Guenthner.

“I’ve been bullish on energy stocks for three months now, but I have yet to pull the trigger on a trade,” he writes for Truth & Trends.

If that makes no sense, allow him to explain: Late last year, Greg already anticipated a “rotation” out of highflying tech names and into forgotten sectors like energy. Sure enough, XLE, the big energy ETF, rallied 10% into mid-January.

“But XLE’s strength evaporated before we were presented with a clear buy signal,” he says. ”Instead of a rip-roaring rally, energy and the overall market fell into a malaise… Energy names have been caught up in the broad selling pressure coloring the market as most investors have scurried to the sidelines.”

That all changed on Monday — when shares of Exxon Mobil broke out.

Here’s a candlestick chart, complete with a reading of relative strength, to illustrate…

“XOM completed a three-month bullish reversal,” says Greg — “after the 14-day RSI slipped below 30 last December (its deepest oversold momentum reading since crude oil went negative).

“If you’ve been burned by energy stocks in the past, I get it. You only have to touch a hot stove once to learn your lesson. But I’m talking about a quick two–three-week swing trade, not a long-term buy-and-hold position. I bet your kitchen hands can handle it.

“Now, you can stick with the safer, less volatile bellwethers (like XOM). Or you can tango with the riskier, more lively drilling stocks. It’s up to you.”

Deep-State Disclosure

“The most important blank page remaining in the JFK files” — as the journalist Jefferson Morley calls it — is finally public.

As we’ve said ever since the 60th anniversary in 2023, the JFK murder marked the moment when Americans’ trust in “the system” began to erode, and the post-WWII zeitgeist that life would keep getting better and better started falling apart. Full disclosure of the redacted JFK files might begin a needed healing process.

On Jan. 23, Donald Trump issued an executive order setting out a process for the release of those files.

Actual release began last night. Morley, who’s been suing the CIA for over two decades for full access to the files, calls it “an encouraging start.”

What Morley calls “the most important blank page remaining in the JFK files” is Page 9 of a memo written by JFK aide Arthur Schlesinger in June 1961, two months after the Bay of Pigs fiasco.

Before last night, we already knew that Schlesinger warned JFK that “the contemporary CIA possesses many of the characteristics of a state within a state.”

At last we know the rest of the story. “The CIA was effectively usurping presidential authority,” Morley tweets. “The agency censored Schlesinger’s case for six decades to obfuscate the reality of CIA power.”

As ABC News reporter Steven Portnoy writes on X…

We now know Schlesinger argued that the CIA’s reliance on “controlled American sources” had been encroaching upon the traditional functions of the State Department, and that the CIA may have been seeking to infiltrate the politics of America’s allies, particularly France.

“CIA today has nearly as many people under official cover overseas as State,” Schlesinger wrote, adding that in certain countries, CIA’s presence “outnumbers regular State Department personnel.”

The previously classified portion of the memo cites the specific number of CIA personnel that had been stationed at the U.S. Embassy in Paris, where “CIA has even sought to monopolize contact with certain French political personalities, among them the president of the National Assembly.”

That’s what the CIA sought to cover up for six decades.

“No, this isn't a ‘smoking gun,'” Morley allows — “but that doesn't mean it’s historically irrelevant. Far from it.

“Schlesinger's memo lays bare the origins of JFK's mistrust of the CIA which continued for the rest of his presidency. Kennedy's suspicions were matched by CIA alienation from JFK's liberal policies. This was one cause of the assassination.”

We still await critical files that are more directly relevant to JFK’s murder — especially the personnel file of undercover CIA officer George Joannides, who kept tabs on Lee Harvey Oswald for four years before the assassination.

But as Morley says, the Schlesinger memo is a good start…

Best regards,

Dave Gonigam
Managing editor, Paradigm Pressroom's 5 Bullets