Morgan Stanley: We Are Bullish Because Central Banks Will Inject Another $2.8 Trillion Of Liquidity In 2021
By Matthew Hornbach, chief rates strategist at Morgan Stanley Liquidity. It’s What’s For Dinner With futures contracts tied to the price of water starting to trade last week, this seems a good time to take a look at the impact of liquidity. Liquidity means different things to different people, so before digging in, let me…
The BIS Issues A Dire Warning: “We Are Moving From The Liquidity To The Solvency Phase Of The Crisis”
There are three certainties in life: death, taxes and the BIS – the central banks’ central bank – warning about excesses from monetary policy (the most recent amusing example of this was last October when as we wrote, “Fed Announces QE4 One Day After BIS Warns QE Has Broken The Market“). Actually, to this list…
The 2021 Liquidity Supernova: Step Aside Fed – US Treasury Will Unleash $1.3 Trillion In Liquidity
One of the most poignant (and painful to some) lessons of the past decade – especially to contrarian, bearish investors such as Odey and Horseman – is that the Fed can keep print money far longer than any short can remain solvent. And while it was considered in poor taste until earlier this year to…
Stocks Give Thanks For Fed Liquidity As Dollar, Gold, & Bitcoin Dumped
Greed, Greed-er, and Greed-est… Source: CNN This level of extreme greed didn’t end well last time. Interestingly, as the week progressed, Nasdaq caught up with Small Caps early-week outperformance, stalling the ‘rotation’ trend. The Dow was the week’s laggard but still managed solid gains… As a reminder, the recent vaccine headlines have put global and…
Central Banks To Add Liquidity Worth 0.66% Of Global GDP On Average Every Month In 2021
Earlier we discussed why Morgan Stanley’s chief equity strategist Michael Wilson voiced concerns about the continuation of the “overcooked” equity rally, expecting a drawdown into year end for the simple reason that “both fiscal and now monetary policy have become reactive rather than proactive. For markets, that becomes the itch that needs to be scratched–i.e….
China’s Financial Distress Floods Shadow Banks As Trust Giant Scrambles For Liquidity
The wave of financial distress flooding China’s corporate sector, which has seen a furious selloff in bonds following the unexpected default of several state-owned enterprises, is spilling over into a key financing conduit used by China’s giant shadow banking sector — the trust industry. As Caixin reports, Huaxin Trust Co. one of 68 companies licensed…
Traders On Edge As China Faces $900 Billion Liquidity Shortage
In all the recent noise surrounding the presidential elections, the pandemic, the state of US fiscal stimulus, and a possible vaccine it is easy to forget that what really matters for the global economy is neither US fiscal or monetary stimulus, nor who the US president is, but rather what China does: after all, recall…