The Bitcoin Layer Global Liquidity Update with Michael Howell: The Case for a U.S. Gold Revaluation Is Building
Mar 8, 2025
Michael Howell, founder of CrossBorder Capital and author of Capital Wars, dives deep into global liquidity trends. He argues that M2 is becoming obsolete and emphasizes asset-based liquidity as a crucial metric. Howell discusses the U.S. debt spiral and the pressure on the Fed to resume quantitative easing, while also spotlighting China's growing influence. A gold revaluation emerges as a potential solution to inject liquidity into the market. Ultimately, he posits that liquidity—not interest rates—will dictate market movements.
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M2 vs. Asset-Based Liquidity
- M2 is an outdated metric for measuring money because it only accounts for retail deposits.
- It misses the bulk of financial transactions, which occur between financial institutions, thus asset-based metrics are better.
Risk Appetite and Market Drivers
- Market behavior is driven by liquidity flow and its deployment into assets.
- Currently, investors are moving away from risk assets like crypto and towards safe assets like gold.
Global Economic Slowdown
- Two factors slowing the world economy are China’s tight monetary policy and fading US stimulus.
- The "secret stimulus" involved bill funding, which monetizes the deficit and increases liquidity.
