The porcelain bull hypothesis: why the market hasn't crashed yet (part 1)

Merry Christmas.

I’ve spent the last days in the office hiding from my family pulling specific data points from FRED (debt service, savings rates, yield curves) to stress-test the "Soft Landing" narrative.
We are essentially in a "Wile E. Coyote" moment running off the cliff, but gravity hasn't kicked in yet because the momentum is so strong.

Why the Crash Hasn't Happened:

As of Q2 2025, the Household Debt Service Ratio sits at 11.2% of disposable income. This is historically low.

For comparison, this ratio peaked at nearly 16% in late 2007 right before the Great Financial Crisis. Even during the "normal" years of 2010–2019, it averaged 12.1%.

Despite the Fed raising rates, the average American is spending less of their income on debt payments today than they did a decade ago. This "shield" explains why higher rates haven't crushed consumption yet.

Total Money Market Fund assets hit a record $7.67 Trillion for the week ending December 17, 2025.
This is up 13.2% from one year ago ($6.77T).

This is massive dry powder. Every time the market dips, this cash steps in to buy, creating a valuation floor that prevents a full capitulation.