Herzlich willkommen zu meinem Sonderpodcast, featuret bei Handelsblatt. Es geht heute um Liquidität und den Einfluss auf die Kapitalmärkte. Das Interview mit Dr. Michael Howell ist auf Englisch. Den Untertitel findet ihr bei mir auf YouTube. Wir sind bei der Foundation for the Study of Cycles, einer Zyklenkonferenz in New York. Viele Anleger schauen an der Börse vor allen Dingen auf Ertragswachstum, wie entwickeln sich die Gewinne der Unternehmen, auf die amerikanische Notenbank, was macht die Zinspolitik? Michael Howell, ehemals Salomon Brothers und Bering, Gründer und CEO von Cross Border Capital. Er sagt, der wahre Taktgeber an den Kapitalmärkten ist eigentlich die globale Liquidität. Wo stehen wir also im Liquiditätszyklus und was bedeutet das für die Kapitalmärkte im Jahr 2026? Viel Spaß beim Gespräch.

Welcome, Michael Howell. Thanks for taking the time with us today, for having this short talk about global liquidities. In today's world, this global liquidity plays a more important role these days than fundamentals and the traditional measures or metrics we are mainly looking at. So how do you think global liquidity changes that importance of fundamentals? Well, I think that's an excellent question, Lars. I think the point is that, we're schooled in the idea that markets will react to fundamentals, but actually capital gets there first. The money flow is there initially, and fundamentals tend to respond to that. So I'm not saying that fundamentals are unimportant in looking at markets, but they're, if you like, a lagging indicator. They're the justification for why people are buying stocks. So you raise a very good point as to say, why is this perhaps more important than historically? The reason being is, think of the size of the financial markets relative to GDP.

In the US now, the financial markets are at least two times GDP, but if you go back 30-40 years, they were a much lower percentage, maybe about 50-60% of GDP. The financialization of the economy, in other words, the big growth of financial markets and the importance of wealth effects is now why this is so important in terms of what happens. I mean, you could argue the tail is wagging the dog, but nonetheless, that's the reality we live in. In practical terms, how would investors use global liquidity and what indicator would they actually look at? What I would say is you look at the mechanism of how that money is moving through markets. So look for signals. You can look at what the Federal Reserve balance sheet, for example, is doing. Or you can look specifically at what's happening to bank reserves in the US. You could look at similar metrics in China or in Japan, or even in the European Union. You could think about how bank reserves, bank liquidity is changing there. You could look at things like the volatility of the bond markets. These are critical elements in the movement of liquidity.

Lars hat mit mir, während der Anfang der Iran-Marsche, ein paar von Ihren Global Liquidity-Analyses gegeben. Und die Analyse looked eigentlich ziemlich bearish für die Markets. Hatte Ihre Global Liquidity-Indicators signale das? Oder was hat eigentlich verändert? Ich denke, die Sache ist, dass es in die Kontext ist. Und ich denke, wie eine Form von cyclical Analyse, muss man versuchen, an die Companion-Cycles zu verstehen. Und was ich wirklich argumentiere, ist, wenn man die Charakteristik der Marken sieht, sie zeigen late-cycle Charakteristik. Das ist ein wichtiges Input in sich. Es ist sehr schwierig, die Siegel zu benutzen, per se, zu prägen, mit Precision, eine bestimmte Bewegung. So, zu sagen, das ist die Top- oder das ist die Bottom-of-Market ist hart. Was man kann sagen, was kind of Regime you're in. Are you in eine bottoming-out period? Are you in eine strong uptrend in der Cycle? Are you around die Peak? Now, wir denken, dass du die Peak-of-Liquidity-Cycle hast. That doesn't mean to say that you're going to get a collapse tomorrow, but it means that you should be looking for those late cycle signs. And we identify this phase as being what we call speculation. In speculation, what happens is you can get decent returns, but they coexist with high volatility. So the quality of those returns is actually reduced significantly. And that's the phase that we think we're in. The other thing to think about is what's happening in the bond markets, because the bond markets are also critical to this. In fact, the bond markets are often more important because they're part of the funding mechanism.

Now, if you look at the bond markets, what you're getting is a movement in the term structure, which is called a bearish flattening of the curve, which means that the long end of the curve yields are going up, but they're going up at a slower pace than the front end. So the curve is basically beginning to flatten and invert. And that's a very late cycle signal normally, and it's not a good omen either. So looking forward, when the late cycle process is in a peaking process, what happens next usually? What would you be looking for as an investor?

Well, the next phase is basically to say what then begins to happen is that bonds start to come into their own as a better asset class. Now, you begin with shorter duration debt, and then you move mid-duration and then finally longer duration. So this should be a phase as liquidity falls down, falls lower, that the bond market should be getting more of a bid. Now, it's difficult to see that at the moment, clearly, because there's a lot of negativity about bonds. But in a way, that's telling you that we're moving towards the end of that particular phase. When everyone sort of believes that the story is negative, it normally flips to being positive. So how did you come up with that cyclic identification? So, I mean, you did it in the year of 2000, so it's a long time ago.

Well, I think, I mean, the first thing to say is that we'd identified cycles in the data before. Okay. In terms of actually measuring it, we saw there was clear evidence of cycles. We were beginning to see from the data, because of the length of data we had, that there was a regular pattern. So we tried to fit that using Fourier analysis, and we did that quite thoroughly in about year 2000. Now, what we've done since then is, after establishing what we then found was a 65-month cycle, is then to extrapolate that forwards in time, which we've done over the last 25 years, and then to look at the actual outcomes relative to that predicted template. And it seems to line up reasonably well. Wir haben ein neues Head des Federal Reserve, Kevin Warsh. Er hat.

Die Idee von Lowering die Balance Sheet in den USA und hat ihn ein wenig zurückkehlt. Was ist Ihr take? Was du willst von ihm in dieser neuen Rolle? Well, I think that's a leading question and a difficult question to answer. But I would say that, I mean, the first thing to say is that.

Is the Federal Reserve the real mover and shaker still in the markets? I mean, that's really the question. Or what particular lever is it that's important for the Federal Reserve? Now, everyone focuses, because we're clearly told to focus on this by the media in particular, and by the Fed, is the Fed funds rate. Now, there's a whole pantomime around setting Fed funds rate, the FOMC meeting, the presser. I mean, you understand all this, but it's really a pantomime. For example, in the last five to six months, the Federal Reserve has injected $600 billion into US money markets. I mean, that's a sizable amount of cash, almost a trillion we're talking about, has gone into the markets. Any wonder why Wall Street is bubbling, OK? Now, what they've done is to do that because the repo markets were getting thirsty, although Sie sehen, dass Sie sich in den Rätten, die Sofa-Rätten zu sehen, in den Rätten zu sehen. Die andere Sache, dass Sie sich aus dem FEDERAL-Reservieren sehen, was die Treasurier ist. The Treasury is, first of all, skewing issuance in the US towards the front end of the maturity structure of government debt. T-bills. Yeah, so they're issuing lots of T-bills, not issuing longer-dated 30-year debt, for example. And who buys that debt are the banks, okay? So if banks buy government debt and buy Treasury bills with alacrity.

What does that mean? That's called monetization. That's called printing money. Because if a bank, an intermediary, buys government debt, they're monetizing the debt. So that's clearly printing money and something that the old monetarist or late monetarist Milton Friedman will be turning in his grave and looking at what the Federal Reserve is doing. But it doesn't look like it's going to change. No, it's going to get worse. What is your take on the long bond deal for this year? And maybe in regards to your statement that 2026 specifically is an important year also in regards to debt that needs to be refinanced. Well, I think the first thing to say is that the data and my impressions are that the US economy is booming. There's no question about that. Okay, it may be a K-shaped economy, as people say, but the fact is, on average, the economy is booming. Inflation is becoming a problem. Okay, there's no question about that.

And whichever way you split that, you can say that nominal GDP growth, the sum of the two, redactivity and inflation, are humming along at a fast pace. Das figure ist vielleicht 7 Prozent, vielleicht 8 Prozent, aber es ist diese Größe. Ist das consistent mit einem Long Bond von 5% oder ca. 5%? Es ist nicht. Es muss sich auf die Aufmerksamkeit auf den Markt auf den Markt. So, was die Autorität ist? Sie versuchen zu cap Bond Yields, durch die Schwarz-Eing-Issuance-Towards-Schwarz-Eing, auf der Long-End-Issuance. So, es ist Excess Demand für Long-Datet Bonds, um die Yields-Eing-Ill-Den. Und dann, um Volatilität zu empfehlen, um mehr Buying-By-Hedge Funds, die ein Arbitrag des Basis-Trade zu machen. Und das ist jetzt in den Weeds des Bond-Market-Tor. Aber sie machen eine Basis-Trad, wo sie kaufen, und sie sind schorten, aber das betrifft auf die Low-Volatilität. Was passiert ist, dass die Treasury in den Markt kommt und suppresst die Volatilität. Es ist nicht Yield-Curve-Control, sondern Yield-Volatilität-Control.

And they're doing that through treasury buybacks. So every time there's a move up in what's called the move index, which is the index of bond volatility, like the VIX, but for bonds, every time that index moves higher, treasury buybacks increase and volatility comes down again. So there's direct intervention. So my view is that far more important than Fed funds is the move index. Absolutely. And you saw that during the beginning of the Iran war, right? I mean, the move index went parabolic, but also turned down. They hammered it down. They turned down and helped Wall Street rally once again.

Talking about markets also a little bit, you monitor the gold-to-oil ratio as another measurement of markets. So can you tell us how is this related to global liquidity and what do you see in the gold-to-oil ratio? The gold-to-oil ratio has been fixed at 20. Therefore, you should be getting this high or ultimate moving gold. Das heißt, dass wenn die Iran-Tensionen subside, Gold nicht mehr zurückbleibt, es wird. Wir sprechen über die Longer Term. Wenn Sie sich über die Zeit, und warum das ist wichtig in eine cyclicale context, es so happens, dass wenn du die Gold-Oil-Ratio trackst, es also moves in der gleichen 65-month cycle, genau wie die Global Liquidity Cycle. Und wenn du die Beginn der Aufswingen der Gold-Oil-Ratio, It moves because the gold price goes up, not because the oil price falls. So at the front end of the cycle, more liquidity expansion raises gold prices. At the back end of the cycle, what happens is the gold price doesn't come down. It's much more the oil price goes up, and that's what forces the ratio down. Now, why is that happening at the end of the liquidity cycle? Because the end of the liquidity cycle occurs because money leaves financial markets and moves into the real economy. Und wir sind durch den Cycle monitoring, wie die Geld durch die Finanze steckt. So die letzte Global Liquidity-Pick war in 2021.

Sie sehen es jetzt in 2026. Und du hast eine große Waffe von IPOs auf den Wall Street. Anthropik ist gekommen, OpenAI ist gekommen.

Wie das das in die Liquidity Cycle spielt? Und was die Effekte das wird?

Auf der Seite, es spielt poorly, weil es würde sagen, dass Geld ist aus Markets. Und clearly, wenn du Geld aus Markets zu funden, aktivität in der Real Economy, die SpaceX ist, oder das vielleicht die Mars Real Economy, Who knows? But whatever it means, money is coming out of financial markets. And that is clearly a negative. I think the rider to that would be to say that what is the free float that they're actually going to put into the market? The free float is very small relative to the size of the IPO. So in actual fact, it would be very difficult, particularly for index funds, to get into this issue. And so there's a technicality, which may mean this is a very successful IPO simply because it's being so rationed. And in other words, if you're an index fund, you have to have a full market weighting or a much higher market weighting that you can ever get your hands on. How does this refer to the asset allocation? So if you are now watching this global liquidity, I mean, you cannot invest in global liquidity. Ja, ich denke, das ist, dass wir die Lüquilität, aber die Weise, dass wir die Lüquilität in den Phasen dividieren. Wir haben vier Phasen, die wir generisch heißen, Rebound, Calm, Speculation, Turbulenz. Die Namen geben es in einer Weise.

Und was wir tenden zu zeigen, ist, welche Asset-Class ist gut für jede Phase. Und da ist ein Transition. And it's not a binary transition, so you need to sort of gradually move in and move out of different asset classes. But generally speaking, in the rebound or the upswing phases of the cycle, what you want are equities. Equities do best far away. Around the peak of the cycle, you want to be commodity-based, so have much bigger weightings than commodities. Why? Because the liquidity cycle leads to the economy. And as you're peaking in liquidity you're beginning to move from the trough to the acceleration stage in economies and they demand more commodities. So that's the reason for that. And then as liquidity starts to tighten in financial markets, the cycle goes down, you want more defensive assets and that probably means more cash, more shorter duration debt.

And then as the squeeze gets bigger and bigger, you get towards the bottom of the cycle, then that's starting to weigh on the economy Die economie ist beginnen, es ist zu slowen. Investors wollen, Longer-dated bonds, because you want duration in that environment, because it's likely that the central banks will then be cutting interest rates, and so bond markets will perform. And then we restart. But how long can this run, and how high can it go? Well, I mean, the answer, it's a question about risk management, not a question about precision of where do you predict the peak to be. In a phase where you've got a lot of speculation, you can devote some of your portfolio to speculation. Okay, good luck on that.

A lot of people are far, far better traders than me. So by all means, put 20% or whatever you feel comfortable with in speculative positions and go for it. That's right. If you can act like a hedge fund and just ride momentum, fine. But you don't want to do that with the core of your portfolio. The core of your portfolio has got to be more disciplined in terms of its management. And it may be a more staid or boring part of the portfolio, but it's the one that people are going to fall back and depend upon. Und wenn du nur 5-10% ein Jahr aus dem Kohl ist okay. Das wird wahrscheinlich beat inflation in den langer term, das ist was du willst. Ich denke, das ist eigentlich eine der größten Missen retail Investoren machen, dass du basically become momentum players. A fascinating time. Michael, danke für den Zeit. Wenn jemand möchte, Global Liquidity und dein Arbeit, was du gerne? Probably die meisten straightforward way ist Substack. Und es ist called Capital Wars. Wunderbar. Vielen Dank. Vielen Dank. Vielen Dank. Vielen Dank.

Und jetzt der obligatorische und barfinsichere Risikohinweis von Mr. Markus Koch. Meine Damen und Herren, liebe Aufsichtsbehörden, ich darf Sie darauf hinweisen, dass die Inhalte in diesem Video ausschließlich der allgemeinen Information dienen, und keiner Empfehlungen zum Erwerb oder der Veräußerung bestimmter Finanzinstrumente und somit keine Anlageberatung darstellen. Insbesondere können Wall Street Correspondents und der Vortragende nicht einschätzen, inwiefern die im Video gemachten Empfehlungen ihren Anlagezielen, ihrer Risikobereitschaft und Verlusttragfähigkeit entsprechen. Wer also auf Basis von Informationen in diesem Video etwaige Anlageentscheidungen trifft, trifft diese ausschließlich auf eigene Verantwortung und eigene Gefahr. Das wiederum bedeutet, dass weder Wall Street Correspondents noch der Vortragende, Das ist immer noch dieser Mann hier, für Verluste haften, die sie dadurch erleiden, dass sie Anlageentscheidungen aufgrund von Informationen oder Kommentaren in diesem Video getroffen haben. Vielen Dank für die Aufmerksamkeit und weiterhin einen erfolgreichen Handelstag.