by Michael Every, Chief Investment Strategist, Rabobank
Michael Every, Chief Investment Strategist at Rabobank, provides an analysis of global economic dynamics. He highlights several events: US firms prioritizing higher prices over volumes, potential increase in flight costs due to compensations, EU's planned sanctions on some Chinese firms supporting Russia, China's anti-spying efforts, and Brazil's new central bank leadership supporting the US dollar. The EU is seen as increasingly protectionist, potentially risking its key achievement. Every also notes the current state of the US banking sector, warning of potential credit crunch risk but suggests that the situation is more nuanced than some headlines suggest. He further discusses the Chinese banking sector, which is thriving due to optimism that Beijing will allow state-owned firms to access more capital. Every concludes by suggesting that we're not quite at a 'Minsky Moment'—a sudden collapse of an asset bubble—but warns of a potential crumbling of the neoliberal global architecture. He suggests that this could be a real tipping point, but perhaps not in the way that many anticipate.
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