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ichael Howell, founder and CEO of Crossborder Capital, predicts a liquidity peak by early 2026, followed by market turbulence due to $40 trillion in debt refinancing needs across government, corporate, and household sectors. In an interview on the Thoughtful Money podcast, Howell attributed current high liquidity levels to factors such as U.S. Treasury General Account drawdowns, foreign central bank easing, and China's massive stimulus.

    The Federal Reserve is injecting liquidity through mechanisms like short-dated Treasury issuance and reverse repo drawdowns, but this will peak by early 2026 before facing strain. A looming $40 trillion debt refinancing wave across all sectors, driven by zero-interest COVID-era debt maturing between 2026 and 2028, could trigger a significant liquidity crunch and market volatility.

    Howell compares the current cycle to the 1980s post-Plaza Accord era, noting similar patterns of monetary easing and asset performance. He expects continued equity outperformance in the near term, led by tech, followed by gains in commodities and small caps. As monetary inflation rises, he recommends hedging with assets like gold, Bitcoin, quality equities, and real estate.

    Howell warns that the cycle may end abruptly if central bank policies diverge or bond market stress resurfaces, citing 10-year Treasury yields and repo market stress as warning signs.