There is a very clear difference now in how we understand the macro situation compared with a few months ago.
I’m no longer as pessimistic as the market has been about macro liquidity.
QT has ended. The Fed has started buying short-term Treasuries again to maintain ample reserves. The Treasury Department is also close to completing its TGA target for the end of September.
And, as always, M2 is still growing.
From February 2026, when it was 22.60 trillion, growing to 23.22 trillion now—an increase of $620 billion in five months—doesn’t fit the typical pattern of liquidity being scarce.
The key is bank credit. I think this is the best evidence of a liquidity rebound.
Over the past year, bank credit has risen from $18.57 trillion to $19.80 trillion, a growth of 6.6%. Bank loans increased from $12.98 trillion to $13.98 trillion, up 7.7%, including a 10% growth in C&I business lending.
Because when banks create loans, they also create deposits—effectively, the private sector is engaging in credit money creation.
Liquidity was relatively tight in August. Mainly, TGA replenishment has already absorbed about $180–200 billion in reserves. But the liquidity environment in September should be better. This may also be one reason why BTC has started to show signs of getting ready to move this month.
#美股收高英伟达涨2% $NVDAB $ZRO
$AAVE
I’m no longer as pessimistic as the market has been about macro liquidity.
QT has ended. The Fed has started buying short-term Treasuries again to maintain ample reserves. The Treasury Department is also close to completing its TGA target for the end of September.
And, as always, M2 is still growing.
From February 2026, when it was 22.60 trillion, growing to 23.22 trillion now—an increase of $620 billion in five months—doesn’t fit the typical pattern of liquidity being scarce.
The key is bank credit. I think this is the best evidence of a liquidity rebound.
Over the past year, bank credit has risen from $18.57 trillion to $19.80 trillion, a growth of 6.6%. Bank loans increased from $12.98 trillion to $13.98 trillion, up 7.7%, including a 10% growth in C&I business lending.
Because when banks create loans, they also create deposits—effectively, the private sector is engaging in credit money creation.
Liquidity was relatively tight in August. Mainly, TGA replenishment has already absorbed about $180–200 billion in reserves. But the liquidity environment in September should be better. This may also be one reason why BTC has started to show signs of getting ready to move this month.
#美股收高英伟达涨2% $NVDAB $ZRO
$AAVE