S&P 500 Index vs. Global M1 Liquidity Another good correlation between the S&P 500 Index and global M1 liquidity, while the Fed plans to stop quantitative tightening. The money supply M1 is the amount of effective money in the economy. Image: Nordea and Macrobond
International Liquidity by Country – Total Reserves Excluding Gold, U.S. Dollars USA holds $115 billion and China holds over $3 trillion in reserves. Image: howmuch.net
M2 / Equity Market Capitalization vs. S&P 500 Could a liquidity shortage send the S&P 500 lower? Image: Alpine Macro
U.S. Equity Market Sensitivities How long will liquidity fuel the U.S. stock market rally? Image: The Wall Street Journal
U.S. 10Y-2Y Treasury Yield Curve and U.S. ISM Manufacturing Index In a situation of extreme excess liquidity, is the U.S. 10Y-2Y yield curve a broken indicator? Image: Morgan Stanley Wealth Management
Equity Flows in H1 Could too much liquidity create market instability? Image: BofA Global Investment Strategy
Valuation – Margin-Adjusted Price/Earnings Ratio on U.S. Stocks and U.S. Stocks Price/Revenue Ratio Will central bank liquidity continue to push valuations higher indefinitely? Image: Financial Times
Valuation – Shiller’s Cyclically-Adjusted Price-To-Earnings (CAPE) Ratio Historically, U.S. stock market crashes have tended to follow liquidity-fueled booms. Image: Financial Times
S&P 500 and Bank Reserves U.S. excess liquidity is expected to rise significantly and tends to push equities higher. Image: Nordea and Macrobond
Cash – Cumulative Increase in Savings Deposits at Commercial Banks Household excess liquidity remains strong. Is it a contrarian bullish signal for stocks? Image: Morgan Stanley Wealth Management