From "Everything Bubble" To "Everything Bust"? Michael Howell on Liquidity In 2025 & Beyond

70 snips

Dec 23, 2024

Michael Howell, Managing Director of Crossborder Capital, shares his expert insights on global liquidity trends and the impending liquidity cycle peak. He analyzes the pivotal role of central banks and cross-border capital flows, warning of potential challenges ahead as refinancing needs grow. Howell also discusses asset dynamics, pointing to the importance of gold and Bitcoin in investment strategies. With a cautious outlook, he highlights the risks associated with the 'everything bust' and the U.S. dollar's dominance in shaping future economic landscapes.

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INSIGHT

Liquidity's Impact on Risk Assets

Michael Howell's bullish view on liquidity has been informative for risk assets.
He uses a three-factor global liquidity index: central bank, cross-border, and private sector liquidity.

INSIGHT

Liquidity Sources and US Asset Buoyancy

Central bank stimulus and strong US corporate cash flow, particularly in tech, increased liquidity.
Cross-border flows significantly buoyed US assets, mirroring past trends in Japan, Asia, and China.

INSIGHT

Hidden Stimulus and Debt Monetization

The Federal Reserve's 'not QE' involves manipulating balance sheet elements, injecting substantial liquidity.
Janet Yellen's 'not yield curve control' shortened US debt maturity, boosting liquidity but risking monetization.

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Today’s episode is brought to you by the Teucrium Wheat Fund. War, weather, inflation—even monetary policy—drive wheat prices. See disclaimers below. Explore the opportunities at: https://bit.ly/Teucrium

Michael Howell of Crossborder Capital joins Jack on Monetary Matters to share his outlook on global liquidity from three sources: central banks, cross border flows, and the private sector. Howell expects the liquidity cycle to peak in late 2025 / early 2026 and says "enjoy the party but dance near the door." Recorded on December 19, 2024.

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CrossBorder’s Website: https://www.crossbordercapital.com/

“Capital Wars” Substack: https://capitalwars.substack.com/

“Capital Wars” the book: https://www.amazon.com/Capital-Wars-Rise-Global-Liquidity/dp/3030392872

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