The bulls have been charging but how much energy do they have?
As we know, the current sharemarket rally could pause or retreat on the back of a shift in sentiment in late 2025 or in 2026.
Massive demands on liquidity from the refinancing of about US$70 trillion of global debt taken up when interest rates were zero would leave less liquidity to sustain the rally in shares, bitcoin and everything else.
Even if the refinancing event did not strain liquidity, fears that it might could be enough to reverse prices, which might indeed be stretched by then.
In this, my final column for 2024, I want to share what I think happens between now and that possible scenario. In any case liquidity strains aren’t an event; they develop over time.
This article was first published in The Australian on 20 December 2024.
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
