Monetary policy is the horse, economy is the cart.
Liquidity moves the economy + financial markets in both directions. Monetary policy works with a lag and its effects become obvious several months later.
GDP and CPI are lagging indicators, they always look hot near the top.
Liquidity moves the economy + financial markets in both directions. Monetary policy works with a lag and its effects become obvious several months later.
GDP and CPI are lagging indicators, they always look hot near the top.
The recent boom was created by the easiest liquidity conditions....ever!
The abrupt ending of QE and tightening by other central banks will bring about big economic slowdown in H1 '22.
Lots of carnage under the hood, many stocks weak...the indices are skating on thin ice.
The abrupt ending of QE and tightening by other central banks will bring about big economic slowdown in H1 '22.
Lots of carnage under the hood, many stocks weak...the indices are skating on thin ice.
Based on liquidity conditions and several leading economic indicators, it appears both economic activity and inflation will peak soon...
Thereafter, we are likely to get a swift contraction in risk assets and flight to safety (US$ and USTs).
Thereafter, we are likely to get a swift contraction in risk assets and flight to safety (US$ and USTs).
Thanks to unprecedented QE and fiscal stimulus, central banks and governments succeeded in creating an 'everything bubble', with several asset-classes (commodities, crypto, housing and stocks) bubbling at the same time.
Gentle reminder ---> Liquidity cuts both ways.
Gentle reminder ---> Liquidity cuts both ways.
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