A Liquidity Masterclass: Preparing For A Credit Cycle Downturn | Darius Dale
Inflection Point
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The Relationship Between Bear Markets and Liquidity
The markets tend to bottom within, let's call it two to three months around what I consider to be the infestible inflection of the liquidity cycle. There are three types: pause pivots, which we saw in kind of 1942 in January 2019; or an actual panic pivot like they were cutting back on tax cuts in 2020. One of those pivots is not going to come anytime soon because again, I think it's too close to a recession for them to work. We can already see the seeds of this soft landing zone and that doesn't sound good at all.
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