Citi: 'Quantitative Tightening' Is Real, and the Recent Market Selloff Proves It
A pedestrian walks past the People's Bank of China (PBOC) headquarters in Beijing, China, on Monday, Jan. 18, 2016. China's economy slowed in December, capping the weakest quarter of growth since the 2009 global recession, as the Communist leadership struggles to manage a transition to consumer-led expansion.
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A siphoning of the global liquidity punch bowl is fueling the 2016 downdraft in global equities, says Matt King, Citigroup Inc.'s head of credit product strategy, jumping on a thesis first promulgated by Deutsche Bank in September.
Individual stock markets aren't responding primarily to domestic liquidity conditions but rather to the state of monetary policy globally, King reasons.