Money supply is unchanged over the past year and has fallen at a never-before-seen 5% annualized rat over the past 3 months.
Why It Matters: Money supply growth peaked (on a year over year basis) at 27% in February 2021 as policymakers responded to the COVID crisis by flooding the financial system with liquidity. That growth has now dissipated and over shorter time periods money supply is actually contracting (it was down for the fourth month in a row in November). Collapsing money supply growth helps take the edge off of inflationary pressures in the economy (there is less money chasing all the goods & services). But liquidity is also the lifeblood of the financial markets. As with seedlings in the garden, when the spigot is turned off, green shoots turn brown and asset prices could struggle to flourish.
These are the registration details for our Live Mid-month Conference Call for Premium Members of All Star Charts.
Our next Live Call will be held on Tuesday January 17th at 6PM ET. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since 2015.
In a recent note, I shared performance stats for our All Star Options Paid-to-Play portfolio, and in the time since, I’ve fielded numerous emails/DMs that all ask basically the same question:
How did you earn money in such a challenging market environment and do so with far lower volatility than the indexes?
Rather than responding individually, I thought it would be better for everyone if I just shared my thoughts here. After all, we can all benefit from good ideas, yeah?
I’ll try not to get us lost in the weeds with the mundane tactical maneuvers employed each trading day. Instead, I’ll stick to the high-level concepts which guide my thinking.
