7 Comments
Nov 13, 2021Liked by Ecoinometrics

Awesome work, always a pleasure to read you. Very reassuring to have regularly good data and analysis to work with.

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Amazing job.

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I have followed the blog for a while and like it. I can help translate to local language to help bring this great news to the local audience. Please let me know your contact details so I can reach out for a discussion. I do hope we can collaborate to bring this great source of information to people who not necessarily understand English and econometrics/economics well enough.

I am looking at not only translating word-by-word but providing a bit more explanation/ paraphrasing/notation to make it more accessible to bigger public.

My email is ductranhuy@yahoo.com

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How can we be aware of the upcoming liquidity ratio and sell our positions on time if this ratio won t go in the good direction ?

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author

Which one are you calling the liquidity ratio? You mean the liquidity of the stock market that's provided by central banks?

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Yes, I do .

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author

Got it.

For lack of a better way of gauging that, I'll be using the rate at which the Federal Reserve is expanding its balance sheet.

This is what you can see on the horizontal axis of the market conditions map in the post.

At the moment it is still positive. But with tapering this rate is going to be lower and lower. What the map says is that typically when you get to an expansion rate below 15% year over year then the stock market is at risk of getting lower returns than average.

That's a way of saying the risk of correction is higher than usual.

We get the data from the Federal Reserve once per week, so I'll be updating where we stand on the map regularly.

Cheers,

Nick

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