As we stand on the precipice of 2025, the financial world is bracing for a tumultuous year, with currency markets expected to experience significant volatility. According to a recent analysis by KKR, a leading global investment firm, the coming year is poised to see a "steep" market correction, largely driven by erratic currency fluctuations. This forecast is based on a confluence of factors, including escalating trade disputes, fiscal instability, and rising geopolitical tensions, all of which are set to amplify foreign exchange (FX) volatility beyond recent historical norms.

Historically, currency-related anxieties have been known to trigger market downturns, as evidenced by the late 1990s. During that period, the Asian financial crisis and the Russian debt default sent shockwaves through global markets, leading to significant currency devaluations and a subsequent bear market. The parallels between those events and the current economic landscape are striking, and KKR cautions investors against underestimating the potential impact of erratic currency movements on the ongoing bull market.

In its 2025 market outlook, KKR highlights that currency fluctuations could become the market's "Achilles' heel," suggesting that this is not an opportune time to take on excessive FX risk. The firm advises investors to prepare for trade wars and growing fiscal imbalances, which are likely to exacerbate FX volatility. Tariffs, for instance, are expected to disrupt global interest rate coordination, leading to further economic friction and instability. As countries engage in tit-for-tat trade measures, the resulting uncertainty can cause investors to flee from riskier assets, leading to sharp declines in currency values.

Monetary policy also plays a crucial role in determining currency values, and significant shifts can lead to market disruptions. Central banks around the world are grappling with the challenge of balancing inflationary pressures with the need to support economic growth. Any missteps in this delicate balancing act can have far-reaching consequences for currency markets. For example, if a central bank raises interest rates too aggressively, it can lead to a rapid appreciation of the domestic currency, making exports less competitive and potentially triggering a recession. Conversely, if a central bank is perceived as being too dovish, it can lead to currency depreciation and inflationary pressures.

Additionally, high levels of government debt can diminish the demand for a nation's currency, potentially resulting in devaluations. As countries continue to grapple with the aftermath of the COVID-19 pandemic, many have amassed significant debt burdens. This has raised concerns about the sustainability of government finances and the potential for default. Investors may become increasingly wary of holding currencies that are backed by heavily indebted governments, leading to capital outflows and currency depreciation.

To better understand the potential implications of these currency fluctuations, KKR encourages investors to reflect on the market dynamics between 1994 and 2000. Following interest rate increases that initially unsettled markets in 1994, stock markets experienced a rally, mirroring the recovery seen since 2022, as noted by KKR. However, the outlook warns that the situation became precarious in 1998, when a combination of currency unwinds and excessive leverage led to a brief but sharp market correction that investors had underestimated. The lessons from this period underscore the importance of being vigilant about currency risks and the potential for sudden market shifts.

Early signs of this phenomenon can already be observed in certain markets. For instance, debt and stock markets in Brazil have been experiencing turbulence this week due to a dramatic decline in the country's real currency. The real has become the worst-performing currency against the US dollar, reaching a record low on Wednesday. Brazilians have been selling off the real since late November, following the failure of proposed austerity measures to appease investors concerned about the country's expanding fiscal deficit. This situation serves as a cautionary tale for investors, highlighting the potential consequences of currency instability on broader financial markets.

Despite these concerns, KKR maintains a largely optimistic outlook for 2025. The firm predicts that the S&P 500 index will reach 6,850 by the end of the year, with a further surge towards 7,500 anticipated in 2026. This bullish forecast is based on several factors, including strong corporate earnings growth, continued economic expansion, and the potential for technological advancements to drive innovation and productivity gains. However, KKR acknowledges that there will be considerable volatility, consolidations, and drawdowns along the way to their 2025-26 price targets.

To navigate this complex landscape, KKR suggests that investors diversify their portfolios by combining exposure to mega-cap technology stocks with cyclical investments, as well as small and mid-cap equities. Mega-cap technology stocks have historically provided a degree of stability and growth potential, given their dominant market positions and robust cash flows. Meanwhile, cyclical investments can offer attractive returns during periods of economic expansion, as they tend to benefit from rising demand for goods and services. Small and mid-cap equities, on the other hand, can provide opportunities for growth and diversification, as they often have greater potential for innovation and expansion compared to their larger counterparts.

In conclusion, as we approach 2025, investors must remain vigilant about the potential risks posed by currency fluctuations and the broader economic landscape. By taking a proactive and diversified approach to portfolio management, investors can better position themselves to weather the storms ahead and capitalize on the opportunities that may arise. For a more detailed understanding of KKR's 2025 market predictions and the potential implications for global financial markets, investors are encouraged to read the original article on Business Insider, which delves deeper into the intricacies of the firm's analysis and offers valuable insights for navigating the year ahead.

Democracy has ancient roots, and the Lycians, who once governed the southwest region of present-day Turkey, were no strangers to this form of governance. Two millennia ago, they established a democratic federation that would later influence the political framework of the United States. Amidst the current global challenges faced by democracies, a different legacy of the Lycians endures in the Mediterranean—a legacy centered on the concept of death.

A drive along the coast reveals the proximity of the deceased to the living, with the Lycians' elaborate tombs etched into cliffs, overlooking towns, valleys, and the sea. These are not the only remnants; grand sarcophagi, likely housing the remains of Lycia's elite, are scattered across the landscape, often seamlessly integrated into the urban environment. For history enthusiasts, seeking out these monuments is an adventure that requires a mix of exploration and historical curiosity. While some tombs are preserved within ticketed archaeological sites, others are open to the public, demanding a level of determination and skill akin to that of an Indiana Jones to uncover.

A suitable starting point for this journey is Fethiye, a laid-back port city that serves as a gateway to the beaches and attractions along Turkey's Turquoise Coast. After a day basking in the region's renowned waters, a visit to the cliffs at sunset is a must. Above the city, once known as Telmessos to the Lycians, and with a panoramic view of the Aegean Sea as the day's final light fades, lie the Aminthas Rock Tombs.

These 4th century BCE carved portals require a small entrance fee of three euros, offering a chance to climb to the main tomb, adorned with Greek-style columns. Though the tomb itself was looted long ago, the view and the proximity to such an ancient site are rewards in themselves. It has become a popular spot for selfies, with some visitors waiting until closing time to capture a photo without the crowds. However, its slightly off-the-beaten-path location means it remains uncrowded, even during the most enchanting hours.

Little is known about the tomb's occupant, Aminthas, other than his relation to Hermapias. The Lycians' death rites remain a mystery. Did these elevated resting places symbolize proximity to the heavens or distance from the underworld? According to local lore, as shared by guide Önder Uğuz, the Lycians placed their dead in cliff crevices or beach tombs to be carried to the afterlife by a winged, siren-like creature. However, no archaeological evidence supports this claim. The mystery deepens, as noted by Catherine Draycott, an associate professor of archaeology at Durham University in the UK, who has studied the Lycian cliff tombs, sarcophagi, and the rare pillar tombs. The Lycians inhabited the region for centuries, developing their funerary monuments from the 5th century BCE, during a time when the area was under Greek, Roman, and Persian control or influence. These tombs are among the few physical remnants of the Lycian civilization.

Draycott suggests that while some speculate the Lycians had an obsession with death, much of our understanding of their beliefs is speculative. "We can hypothesize that there might be economic status differences among those who commissioned the tombs, but that is not confirmed. The visibility of the tombs is clearly significant, not just their location on a road, but their prominence from a distance. Do we know why? No." More impressive rock-cut tombs can be found northwest of Fethiye, near Dalyan, and several other sites to the south and east, including the ancient city of Myra, near the modern Turkish town of Demre. Here, the cliffside necropolis looms over what later became a prosperous Roman city, with a theater whose ruins still stand today. Visitors can enter the ground-level tombs, but those higher up, adorned with intricate carvings, are inaccessible.

The cliff tombs share a commonality with the unique pillar tombs found at the inland Lycian site of Xanthos: the elevation of the deceased towards the sky. The significance of this practice remains speculative, as Draycott points out. "We cannot determine if there is a connection between Lycian beliefs and sky gods," she says, noting that ancient death traditions from the Mediterranean Levant region were more focused on Chthonic spirits believed to reside underground.

"The tombs certainly suggest a preference for not being buried and a desire to be elevated—but it is unclear if those buried higher had any advantage, although one could argue that their status was greater in terms of tomb competition, as they would have needed to transport their masons to such heights." Draycott theorizes that tombs on pillars might have been a form of community building, using ancestor worship to create myths and genealogical loyalty to foster a more cohesive society during times of unrest.

While many of the main Lycian burial sites are designed to be prominent parts of the cityscape, the sheer number of tombs scattered throughout the region means that some have become part of the natural landscape. This is why one might see cars casually driving past a sarcophagus in the middle of the road at Fethiye or find one stuck in a traffic circle in the coastal resort town of Kaş. There's also a rock-carved tomb, seemingly ignored, next to a capsicum farm, miles from any settlement. Kaş, another jewel of the Turquoise Coast, is a tourist town where pleasant evenings are spent wandering through lanes of boutique shops (and tombs) and moving between open-air bars and restaurants along the bustling harbor.

For those seeking adventure before donning their finest attire, a trip to the hill behind Lykia Cadesi is recommended. There, almost hidden by flowering shrubs, a sign for "Lycian rock tombs" points up a steep staircase. The steps lead to one tomb, with more hidden further up the cliff for those willing to scramble up daunting rock faces. While not requiring expert climbing skills, a head for heights and strong nerves are beneficial. This location offers spectacular views at sunset, with panoramic vistas over Kaş and beyond to the Aegean. However, it is advised not to delay the descent until it gets too dark.

The region offers numerous less strenuous Lycian tomb explorations. Along the coast between Kaş and Demre lies the village of Kaleüçağız, where regular boat tours depart to view the nearby ruins of a sunken ancient Greek city and also visit a Lycian tomb standing in water. Kaleüçağız also has other Lycian treasures. A short walk along a rugged track heading east out of the village leads to Theimussa Ancient City, a collection of colossal sarcophagi amidst giant boulders, overlooking the nearby bay.

The size of these stone tombs and their heavy lids, as Draycott explains, is an indication of the status of those interred within. "It would have been a significant undertaking," she says, "Those lids weigh tons." Despite the rich history available at Theimussa, it remains a tranquil spot, with a high likelihood of having it to oneself, as most visitors are drawn to the sunken city. A towel can be brought for a quiet solo swim to admire the tombs from the offshore.

Back in Kaleüçağız, more tombs can be found unceremoniously placed in parking lots. While this wealth of history can be astounding for visitors, for locals, these enduring relics of a long-gone civilization can sometimes simply blend into the background. "I don't really care about the historical things," says a young man waiting tables at the family-owned Gönül Cafe on the edge of the village. "I prefer nature and sport."