In this episode, Nik welcomes back Michael Howell, founder of CrossBorder Capital and author of Capital Wars, to discuss global liquidity and the mounting case for a U.S. gold revaluation. Howell explains why M2 is outdated, highlighting the shift to asset-based liquidity as a better market gauge. They explore the U.S. debt spiral, pressure on the Fed to resume QE, and China’s role in shaping liquidity. Howell also examines how a gold revaluation could inject much-needed liquidity into the system as debt levels surge. With tightening financial conditions and shifting risk appetite, this conversation unpacks why liquidity—not interest rates—drives markets.
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Chapters:
00:00:00 Understanding Global Liquidity: M2 vs. Asset-Based Metrics
00:03:10 Importance of Credit in Financial Markets
00:06:28 Current Trends in Global Liquidity and Market Volatility
00:09:09 Trends in Safe Assets and G10 Government Bonds
00:12:07 Analyzing Yield Trends and Economic Slowdown
00:15:09 Understanding Federal Reserve's Quantitative Tightening Strategy
00:18:03 Federal Deficit and Banking Impact
00:21:00 China's Economic Influence and PBOC Liquidity Movements
00:23:46 Understanding Government Borrowing and Fiscal Deficit
00:27:00 Impact of High Interest Rates on Debt Growth
00:29:51 Potential Vulnerabilities in Small to Midsize Banks
00:32:49 Federal Reserve's Market Impact and Delusions
00:35:52 The Importance of the MOVE Index and Its Impact on Collateral Management
00:38:41 The Impact of Gold Revaluation on Economy and Debt
00:41:33 Understanding Bond Market Dynamics and Economic Indicators
00:44:37 Understanding Global Liquidity and Debt Maturity