The Liquidity Situation will soon worsen, from March. Equity markets could then see a serious sell-off

January 15, 2020

"... Therefore, the Fed's balance sheet will likely expand until March 2020. But that is when we at The Capital Observer expect the equity markets to have a serious sell-off, beginning early March, when it becomes apparent that this “Not QE” stimulus will not be extended. Remember, the economy will still do well in Q1 2020 – no urgent reasons to be applying stimulus when the Core CPI is already surging hot. And “Not QE” was, after all, a mere palliative solution for the clogged-up repo market plumbing in Q4 2019 ... " 

Page 48, January 2020 issue,

The Capital Observer

 

 

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