Liquidity growth masks underlying economic stress
The guest argued that soaring global money supply growth is driving asset prices higher, discounting currency debasement despite severe geopolitical and energy risks.
The argument
Lacalle noted that money supply growth is at its fastest rate since 2021, led by China, the US, and the UK. While economic uncertainty and war are reducing money velocity, the sheer volume of money forces asset prices upward as a hedge against purchasing power destruction.
The thesis, stress-tested
✓ What validates it
- ✓Continued expansion of global M2 money supply
- ✓S&P 500 maintaining record highs despite worsening geopolitical headlines
▸ Risks discussed
- ▸A sudden contraction in central bank liquidity
- ▸A sharp rise in money velocity triggering aggressive rate hikes
Hear it yourself
"And I'm Patrick Ceresna with the macro scoreboard week over week as of the close of Wednesday, 04/29/2026. The S and P 500 index down four basis points trading at seventy one thirty five. No initial reaction to the Mag seven earnings or the oil pop, but we'll take a closer look at that chart and the key technical levels to watch in the postgame segment. The US dollar index up 38 basis points trading at ninety eight ninety seven. The June WTI crude oil contract up 1,497 basis points trading at one zero six eighty eight, a material breakout back towards its highs."
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