In its 2026 outlook released on Jan. 15, ARK Invest CEO Cathie Wood declared the U.S. economy a “coiled spring” poised for a powerful rebound, forecasting a “golden age” for U.S. equities comparable to the boom of the 1980s.
Reaganomics On Steroids
Wood argues that the “rolling recession” of the past three years—triggered by the Federal Reserve's aggressive rate hikes—has wound the economy tight. With deregulation, tax cuts, and falling interest rates now converging, she predicts this tension will result in a surge of GDP growth and wealth creation.
Drawing parallels to her early career, Wood termed the current environment “Reaganomics on steroids.” She posits that the combination of fiscal stimulus and pro-business deregulation will unleash capital spending, particularly in artificial intelligence (AI) and robotics.
According to Wood, this backdrop creates a perfect storm for innovation-led growth, benefiting the ARK Innovation ETF(BATS:ARKK) and the broader S&P 500 tracking SPDR S&P 500 ETF Trust(NYSE:SPY).
She projects that real GDP growth could accelerate to 6-8%, driven not by inflation, but by a 4-6% surge in productivity that suppresses unit labor costs.
The next three years could be Reaganomics on steroids, another golden age for the US equity market. Back then, early in my career, I remember how deregulation, tax cuts, sound monetary policy, and peace through strength sent the dollar soaring, which put a lid on the gold price! https://t.co/kVRmZlQsNZ
Central to the “coiled spring” thesis is the housing market. Wood highlights that existing home sales have been suppressed to levels last seen in the early 1980s, despite a significantly larger population today.
As rates stabilize and inventory unlocks, she expects a sharp recovery. The letter specifically points to major homebuilders, such as Lennar Corp. (NYSE:LEN), KB Home(NYSE:KBH), and D.R. Horton Inc.(NYSE:DHI), which have slashed prices to clear inventory, effectively resetting the market for a volume boom.
Bitcoin Over Gold
In a notable shift for asset allocators, Wood advised skepticism toward Gold, tracked by SPDR Gold Trust(NYSE:GLD), which she views as historically expensive relative to the M2 money supply. Instead, she doubled down on Bitcoin(CRYPTO: BTC), citing its mathematical scarcity and “halving” mechanics.
Wood notes that while gold supply increases with demand, Bitcoin's supply growth is programmed to decelerate.
So far in 2026, the Nasdaq 100 index has advanced by 1.35%, whereas the S&P 500 and Dow Jones indices have risen by 1.25% and 2.19%, respectively.
The Invesco QQQ Trust ETF(NASDAQ:QQQ), which tracks the Nasdaq 100 index and SPY closed higher on Thursday. SPY was up 0.27% at $692.24, while the QQQ advanced 0.36% to $621.78.
The futures of the S&P 500, Nasdaq 100, and Dow Jones indices were trading higher on Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: ST House Studio on Shutterstock.com
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