The bear market is caused by a sharp contraction of the money supply due to liquidity withdrawal by the Central Bank. Even more, damage can be (and will be) done by the U.S. Federal Reserve. The QT is scheduled to start in June, but the Fed is already hinting at a tightening (outflow) of liquidity within a few months. The Fed’s effective balance sheet should shrink by $2 trillion under the QT plans, but a policy error could easily lead to a larger $3 trillion correction and bring down stock prices. Since late 2021, the market has been bearish on […]