The CrossBorder Capital Blog

The Treasury-Fed ‘Accord’ And Why Are We Still (Very) Cautious?   We have taken a lot of risk off. We fear stock markets are headed lower. Global Liquidity is already falling and slated to fall much further. Investors still have high exposure to equities within portfolios, and these levels, even now, are out-of-line with skidding economic activity. On top, we figure that the US authorities are getting far tougher about high street inflation and more focussed on controlling the domestic and international supplies of the US dollar. The dollar ‘wrecking-ball’ is already swinging.     See our latest published research, Global View – The Treasury-Fed ‘Accord’ And Why Are We Still (Very) Cautious? - April 2022    

How The West Was One   Bretton Woods, the original set of international currency arrangements devised in 1944 and integral to the International Liberal Order, remains largely intact. There was no Bretton Woods II, and there will be no Bretton Woods III as some claim. Bretton Woods is wrongly seen as an accounting system with units fixed to the US dollar, whereas, in practice, it underpins a global funding system, based around the US dollar, that allows capital to circulate Worldwide. We argue here that the system is likely to become less elastic, not because of the rise of rival units, but from tighter US controls as new loans are directed towards ‘friends’ and away from ‘foes’. In fact, much like its 1960s heyday when The West faced-off ‘The Rest’.       See our latest published research, Global View – How The West Was One - April 2022    

China and Emerging Market Liquidity: Too Much Risk   ·                 Strong private sector liquidity, powered by soaring commodity prices, is being dragged down by pre-emptive monetary tightening by Emerging Market Central Banks ·                 There has been a sea-change in Chinese economic policy away from ‘growth at all costs’ towards stability of the Yuan currency       See our latest published research, China and Emerging Markets Latest GLI™ – April 2022  

Global Liquidity Latest: Weaponizing the Fed   ·          We are in a downswing that is fast-approaching the investment phase we dub ‘Turbulence’, characterised by slowing and sub-par liquidity   ·          Investors are positioned too ‘risk on’ based on their asset holdings, with extreme risk positioning seen across the Eurozone (ex-Germany) and Asian Emerging Markets         See our latest published research, Global Liquidity Latest – April 2022