Supply Shock
The U.S Dollar Wrecking Ball In A China Shop | Michael Kao & Nick Glinsman
Aug 23, 2023
Former hedge fund manager turned private investor Michael Kao and Co-Founder at Malmgren-Glinsman Partners Nick Glinsman discuss China's debt problem, real estate headwinds, and battle with deflation. They explore the impact of the 'U.S Dollar wrecking ball' in Asia and the future of the U.S treasury market. Other topics include the implications of embracing the US dollar, lack of cooperation between PBOC and Fed, sovereign debt Jubilee, weaknesses in central bank minds, and geopolitical perspectives on economic instabilities.
01:15:51
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Quick takeaways
- The strength of the US dollar is affecting global economies, particularly China, and may lead to a global economic downturn.
- The weakening of the Euro, caused in part by China's economic issues, will have a significant impact on global markets.
Deep dives
The Impact of the Dollar and US Consumers on Global Markets
The podcast episode discusses the current state of the US dollar and its impact on global markets. The speaker notes that after the peak of the DXY in fall 2022, many people were ready to call the beginning of the next down cycle for the dollar. However, the speaker argues that the strength of the US consumer is forcing the Fed to keep interest rates higher for longer. This creates a challenge for other countries, especially China, as the dollar's strength affects their economies. The speaker predicts a global synchronized economic downturn, with demand in the West faltering and China struggling with its internal faults.
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