Monday, September 16, 2013

16/9/2013: A Liquidity Slush or an Equity Switch?

Three more charts from BIS Quarterly (, showing the switch of liquidity out of the Emerging Markets into Advanced Economies...

 And then from the Advanced Economies bonds into Advanced Economies equities with a small bounce up on Emerging Markets equities side too...

Two thoughts:

  1. There is no yield-driven bounce anymore, so pricing is not a huge help in this process; and
  2. Is this the end of the debt bubble and the start of the equities rise (structural, not nominal rise, driven by shift in corporate funding models) or is this a temporary slush of liquidity?

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