Cross-Asset Liquidity Strategist, CrossBorder Capital

Michael J. Howell

Cross-Asset Liquidity Strategist

Implementing Research Using Alt Data & AI

CrossBorder Capital

CrossBorder Capital is a London-based independent investment advisory firm. Founded in 1996, it exploits a gap in the investment arena by focusing on Central bank liquidity. 

It specialises in the monitoring and analysis of global liquidity flows - an important determinant of asset prices, from currencies through to bonds, equities and real estate.

CrossBorder Capital implements its investment strategy and currently manages over US$ 350m.


Cross Asset Strategy

<ul>
<li>
 Chinese economy skidding badly, buffeted by C-19 lockdowns and strong US dollar. Domestic economic weakness alongside strong dollar are two critical facts. </li>
<li>
US dollar has been weaponized and pointed towards the Chinese Yuan. Growing pressure on Yuan to devalue </li>
<li>
US policy is to drive Fed balance sheet lower and US dollar higher, forcing credit funders back to the US unit</li>
</ul>



 Chinese economy skidding badly, buffeted by C-19 lockdowns and strong US dollar. Domestic economic weakness alongside strong dollar are two critical facts. 

US dollar has been weaponized and pointed towards the Chinese Yuan. Growing pressure on Yuan to devalue 

US policy is to drive Fed balance sheet lower and US dollar higher, forcing credit funders back to the US unit


Yuan Devaluation (CNY): China At A Turning Point?

<ul>
<li>World Stock Markets are being battered by weak US Fed Liquidity and by weakening World economic activity 
</li>
<li>
Central Bank tightness increasing driven by US Fed who are slated to drain US$2 trillion from markets </li>
<li>
Chinese economy struggling under C-19 lockdowns and tight People's Bank (PBoC)</li>
</ul>


World Stock Markets are being battered by weak US Fed Liquidity and by weakening World economic activity 


Central Bank tightness increasing driven by US Fed who are slated to drain US$2 trillion from markets 

Chinese economy struggling under C-19 lockdowns and tight People's Bank (PBoC)


What’s Driving The Bear Market ... Lower?

<ul>
<li>
Bear market underway in World equities and likely to see one-third peak to trough decline</li>
<li>Trigger is US Fed QT, but US Fed is NOT about to start QT. It has already been underway since Dec 15th 2021</li>
<li>Each $100 billion of QT, costs the SPX index around 60 points. Therefore expect S&amp;P500 to test 3250, or 20% lower
</li>
</ul>



Bear market underway in World equities and likely to see one-third peak to trough decline
Trigger is US Fed QT, but US Fed is NOT about to start QT. It has already been underway since Dec 15th 2021
Each $100 billion of QT, costs the SPX index around 60 points. Therefore expect S&amp;P500 to test 3250, or 20% lower



QT Is Already Here And The 2022-23 Bear Market Is Now Well Underway

<ul>
<li>
Global Liquidity seeing significant collapse and World Central Bank Liquidity slated to contract by 10-20% over 2 years</li>
<li>
 US Dollar set to make further gains.  US dollar swap-lines become important</li>
<li>
 World commodity prices to skid lower as World economy hits recession</li>
</ul>



Global Liquidity seeing significant collapse and World Central Bank Liquidity slated to contract by 10-20% over 2 years

 US Dollar set to make further gains.  US dollar swap-lines become important

 World commodity prices to skid lower as World economy hits recession


Alert: Do Bears Hunt in Packs? (Part 3) The Coming Turmoil in Currency and Commodity Markets

<ul>
<li>Global Liquidity, the main driver of World asset markets, will head much lower </li>
<li>World Central Bank Liquidity slated to contract by 10-20% over next 2 years</li>
<li>Bond markets are already screaming a warning with 'death-cross' formation</li>
</ul>


Global Liquidity, the main driver of World asset markets, will head much lower 
World Central Bank Liquidity slated to contract by 10-20% over next 2 years
Bond markets are already screaming a warning with 'death-cross' formation


United States

The MSCI World Index is a free-float weighted equity index. It was developed with a base value of 100 as of December 31, 1969. MXWO includes developed world markets, and does not include emerging markets. MXWD includes both emerging and developed markets.

MSCI World Index (MXWO INDEX)

Yuan Devaluation (CNY): China At A Turning Point?

Domestic economic weakness plus strong US dollar expose China's fragile position. C-19 lockdowns have hard-hit the economy, but PBoC being forced...

Michael J. Howell

What’s Driving The Bear Market ... Lower?

World Stock Markets being battered by weak US Fed Liquidity and by weakening World economic activity. Latest data suggest we are going lower......

Michael J. Howell

QT Is Already Here And The 2022-23 Bear Market Is Now Well Underway

Bear market underway in World equities. Expect a one-third peak to trough decline, triggered by Fed QT. Target SPX 3250 on index

Michael J. Howell

Alert: Do Bears Hunt in Packs? (Part 3) The Coming Turmoil in Currency and Commodity Markets

Part 3 of an explanation of the effects of much tighter Global Liquidity. The US dollar is headed higher and sky-high World commodity prices are...

Michael J. Howell

Alert: Do Bears Hunt in Packs? (Part 2)

Following Part 1 we dive-deeper into the bear case. The collapse in Central Bank liquidity and the warnings already signaled by bond markets spell...

Michael J. Howell