The CrossBorder Capital Blog

Come Back Mr Bond…YCC Is Here!   If Central Banks are not yet waving the white flag, it has been unfoiled. The list of policy-makers using some form of yield curve control (YCC) is getting longer by the day. We re-iterate that the recent market turmoil confirms the tight Global Liquidity backdrop. Markets may be near an inflection in liquidity, if not in policy rates? This year’s ‘get the Fed B/S down and the US$ up’ will surely reverse in 2023 into ‘get the US$ down and the Fed B/S up’. Policy-makers under-estimate the need for QE. The final bear phase is upon us! Mr Bond is back.     See our latest published research , Global View: Come Back Mr Bond…YCC Is Here! - September 2022    

IMPORTANT IMPORTANT – From Friday 1st July, we will be phasing out emails sent from sender@liquidity.com. To simplify our systems, we are consolidating our email addresses. All our emails will become sender@crossbordercapital.com. From 1st September, emails sent to ANY email account ending in liquidity.com will NOT work. Please update your records before 1st September. You may also receive a direct communication from your contact to this effect. Please feel free to contact us on info@crossbordercapital.com at any time about this change. Icarus Is Falling! A 2022 Market Crash? Evidencing The Rush To Safety   Higher forex volatility and higher bond volatility eventually pass through into higher equity volatility. The second leg-down in this bear market is upon us, characterised by collapsing corporate earnings. Treasury term premia stand at all-time lows: they are consistent with a 20% plus fall in US S&P500 earnings in 2023. ...

IMPORTANT IMPORTANT – From Friday 1st July, we will be phasing out emails sent from sender@liquidity.com. To simplify our systems, we are consolidating our email addresses. All our emails will become sender@crossbordercapital.com. From 1st September, emails sent to ANY email account ending in liquidity.com will NOT work. Please update your records before 1st September. You may also receive a direct communication from your contact to this effect. Please feel free to contact us on info@crossbordercapital.com at any time about this change. The Markets After Jackson Hole: Don't Fight The Fed…Give In Now!   Post-Jackson Hole, the Fed has its head-down and is determined to battle inflation. US policy is front-ended loaded and policy-makers even warn of recessionary pain ahead. However, the quantitative liquidity dimension is being ignored. Fed B/S reduction or QT is asymmetric and non-linear in its effects. It will cause funding markets to bu...

Global Liquidity Latest: A Bigger Crash?! ·                 Central Banks are making a major error by hammering down too hard on the brake. World recession is inevitable   ·                 US 10-year Treasuries are worth buying on 3% yields, and given their prevailing yield cushion, high yield US corporates are not far off a 12-month break-even point     See our latest published research, Global Liquidity Latest – July 2022   IMPORTANT – Our email addresses are changing – emails from sender@liquidity.com will become sender@crossbordercapital.com from the 1st of July 2022. After this date emails to ANY email account ending in liquidity.com will NOT work. Please update your records before the 1st of July 2022. You may also receive a direct communication ...

Why Are Equity Investors So Upbeat?   We think of investment markets as largely driven by two moving parts: inflows of liquidity and the portfolio exposure of investors to risk assets. The first leg down in a bear squeeze often comes from falling liquidity: the second leg down comes from greater risk aversion. Using US data, we show that this comprises both a lower demand for equity risk and the greater supply of government bonds.       See our latest published research, Global View Why Are Equity Investors So Upbeat? - June 2022     IMPORTANT – Our email addresses are changing – emails from sender@liquidity.com will become sender@crossbordercapital.com from the 1st of July 2022. After this date emails to ANY email account ending in liquidity.com will NOT work. Please update your records before the 1st of July 2022. You may also receive a direct communication from your contact to this effect. Please feel free to con...

“Whatever It Takes” …and More: Euro Set To Fall Below Parity   ‘Muddling through’ is the moniker of the Euro-system. In its present unstable form, it faces permanent crises. The Euro’s underlying structural flaws are now again being exposed by the latest global monetary tensions. Since a political fix seems unlikely, the only practical path for policy-makers is to ‘do a Japan’ and crash the Euro.       See our latest published research, Global View “Whatever It Takes” …and More: Euro Set To Fall Below Parity - June 2022     IMPORTANT – Our email addresses are changing – emails from sender@liquidity.com will become sender@crossbordercapital.com from the 1st of July 2022. After this date emails to ANY email account ending in liquidity.com will NOT work. Please update your records before the 1st of July 2022. You may also receive a direct communication f...

Global Liquidity Latest: "Liquidity Is Terrible"   ·            US QT 'officially' starts this month, June 2022, but the 'effective' balance sheet has already dropped by a whopping US$1 trillion since December 2021 ·            China is facing major downward pressure on her currency, sufficient to cause the PBoC to tighten domestic liquidity policies by an extra US$95 billion     See our latest published research, Global Liquidity Latest – June 2022   IMPORTANT – Our email addresses are changing – emails from sender@liquidity.com will become sender@crossbordercapital.com from the 1st of July 2022. After this date emails to ANY email account ending in liquidity.com will NOT work. Please update your records before the 1st of July 2022. You may also receive a direct communication from your contact to this effect. Please feel free to co...