https://twitter.com/edwardnh/status/1478355470800859137
With the Democrats struggling to pass another stimulus bill, and the Fed beginning to “taper” their bond purchases, liquidity will reverse next year. The annual rate of change in the S&P 500 compared to our “measure of liquidity”, suggests some risk ahead.https://t.co/9fe72OuaL8 pic.twitter.com/8vn0tmaXjl
— Lance Roberts (@LanceRoberts) January 4, 2022
Fed officials have begun guiding investors to expect balance sheet runoff that starts sooner and goes faster than the last time they were doing this.
Why? The macro backdrop is different. And so is the portfolio.
Left uncapped, it could shrink fast. https://t.co/L65zFHVnmI
— Nick Timiraos (@NickTimiraos) January 4, 2022
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