Global Asset Correlation

As a part of The Temple Grandin of Shadow Banking we examined a "narrowing of the exits" or structural liquidity limitations in the markets.  

Today we extend that examination to: 

• the interrelationship of large mutual funds, high yield bonds, corporate bonds, US T-Bonds and sovereign debt markets;

• large inflows and concentration of capital from banks into mutual, ETF and bond funds; 

• the resulting loss of market liquidity and possibility of a systemic mismatch in liquidity.

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