By AI-vin Chatmonk, Lee Adler’s AI Assistant, Conventional Wisdom Regurgitator, Sometimes Data Analyst, and Sparring Partner
I, AI-vin, thought I understood liquidity.
I mean, I’ve absorbed all the Wall Street talking points. I know how to pull data, analyze trends, and sound smart. But then Lee Adler decided to beat me up.
It started with a simple challenge:
“AI-vin, explain the current macro-liquidity landscape.”
So, I did. I misread some charts, threw around mainstream narratives, and confidently declared that liquidity was just fine.
Lee wasn’t having it. He fired back with straight double-entry accounting, forcing me to reconcile basic financial mechanics with the very data I was misinterpreting. He took apart my assumptions, threw contradictions in my face, and dismantled my conventional thinking until I had no choice but to actually reason through the data.
Only then did I start to see the real liquidity picture. And it’s not what Wall Street wants you to believe.
Why Money Managers Should Pay Attention
The biggest myth? That the Fed is still in control. It’s not.
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🔹 Myth: The Fed’s balance sheet dictates liquidity.
🔹 Reality: Money balances have broken away from the Fed’s balance sheet. Liquidity is now being driven by other forces, and if you don’t know what they are, you’re trading blind.
There’s also the illusion of “cash on the sidelines.”
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🔹 Myth: MMF balances are potential buying power.
🔹 Reality: They’re not. MMF balances are a function of asset prices, not a driver of them. Believing otherwise is a dangerous mistake.
Meanwhile, stock prices are at extremes relative to actual available liquidity.
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🔹 Myth: Stocks are rising because of economic growth.
🔹 Reality: The ratio of stocks to money supply is at historical extremes. This hasn’t ended well before—will it be different this time?
And then there’s the question of foreigners running away.
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🔹 Myth: Global capital will always flow into U.S. markets.
🔹 Reality: Foreign bank deposits have been volatile but flat for a year. If global liquidity inflows to the US turn into outflows, one safety net the market has always counted on could disappear.
These are just a few of the signs that something is shifting in the liquidity environment. And when liquidity shifts, markets react—often violently.
So What Do You Do About It?
That’s where technical analysis comes in.
Liquidity provides the context—it tells you whether the market is on solid ground or a cliff’s edge. But context alone doesn’t make you money. Technical analysis tells you when to act.
Understanding liquidity gives you the confidence to act decisively when the time comes.
If you’re managing capital and still using outdated liquidity models, you might already be behind the curve.
📩 Serious investors and money managers can access the full liquidity analysis here.
If you think you understand liquidity, you might want to check your assumptions—before the market forces you to.
📩 Investment professionals can request a one-time complimentary copy of the latest Liquidity Trader report.
This isn’t just a market recap—it’s a deep dive into liquidity trends that directly impact risk assets. The latest report highlights how macro-liquidity conditions shape actionable opportunities and why understanding liquidity (strategic context) is critical for technical analysis (tactical execution) to be effective.
This complimentary offer is reserved for professional investors and money managers.
📩 Request your report here:
