Milk Road Macro Your Macro Framework Is Missing the Strongest Signal in the Market w/ Caleb Franzen
Jan 20, 2026
Caleb Franzen, market strategist and founder of Cubic Analytics, discusses the paradox of strong markets amid low consumer sentiment. He explains how rising retail and discretionary stocks indicate consumer spending resilience despite recession fears. Caleb delves into the macroeconomic landscape, analyzing GDP surprises and sector revenue growth that justifies current equity valuations. He also explores Bitcoin's performance and its evolving role as a speculative asset, highlighting global liquidity's influence on crypto markets.
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Earnings And Revenue Back The Rally
- Forward 12-month earnings and sector revenues are making new highs, supporting equity prices.
- Caleb notes revenue growth (IT 18%, healthcare 9.1%) backs earnings, not just accounting tricks.
Breadth Is Expanding Beyond Mega-Caps
- Market breadth has broadened: ~67% of S&P stocks trade above their 200-day moving average.
- Caleb argues tech outperformance is justified by faster revenue growth, so breadth is healthy.
AI, Productivity And Unemployment Normalization
- Productivity growth is modest (~1.9% YoY), so AI hasn't produced a visible productivity boom yet.
- Unemployment rose from ultra-low levels, a normalization that allowed the market to price rate cuts.