Liquidity Is Breaking And The Economy Is Next | Michael Howell

Forward Guidance

In this episode, Michael Howell joins the show to discuss the Fed & Treasury’s hidden stimulus tapering off, why we need more liquidity in the financial system to refinance debts, and why the Fed’s QE & duration goals are unrealistic. We also delve into the dislocation between the 10-year yield and mortgage rates, what China needs to do to escape its debt deflation, global liquidity’s correlation to Bitcoin’s price, and more. Enjoy!

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Timestamps:

(00:00) Introduction

(00:06) Deep Dive into Bank Reserves

(03:53) Fed/Treasury Pump and Dump

(09:51) Global Liquidity and Debt Refinancing

(16:05) Ledger Ad

(16:49) Bank Reserves & Liquidity-to-Debt Ratio

(20:19) Post-GFC Financial System

(23:46) Repo Market Tensions

(35:01) Ledger Ad

(35:46) The Fed's Duration Dump and Debt Refinancing

(39:25) Yield Curve Suppression and Inflation Rates

(44:11) Credit Markets and Risk Appetite

(50:47) China's Economic Policy and Gold Strategy

(01:00:52) Bitcoin & Global Liquidity

(01:07:59) Final Thoughts

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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.