Quantitative Tightening Keeps Us Cautious on Risk Assets, Says BofAML's Hauner

The video discusses the shift from quantitative easing to quantitative tightening and its implications on global liquidity and risk assets. It highlights the limited firepower of central banks, especially in the context of a potential economic downturn. The impact of a strong US dollar on emerging markets is analyzed, noting the risks of capital outflows and economic strain. The video also evaluates market valuations, particularly in emerging markets, and provides a future outlook based on currency movements and economic data from China.

What is a potential risk associated with the transition from quantitative easing to quantitative tightening?

• Decreased interest rates

• Increased liquidity in the market

• Strengthening of emerging market currencies

• Limited firepower of central banks

How does a strong US dollar pose a risk to emerging markets?

• It leads to increased foreign investments

• It strengthens emerging market currencies

• It causes capital inflows

• It results in capital outflows and policy tightening

What is the current stance of the house regarding the US dollar?

• Expecting dollar to remain stable

• Neutral on the dollar

• Dollar bearish

• Dollar bullish

What factor is crucial for the short-term recovery of emerging markets?

• Strengthening of the US dollar

• Decrease in global oil prices

• Weakening of the US dollar

• Increase in US interest rates

What is the foundation of the tactical emerging market call?

• Strengthening of the US dollar

• Stabilization and improvement of China data

• Decrease in global oil prices

• Increase in US interest rates