Global Macro Trading
Fundamental Thesis
THE LONG DOLLAR CREDIT CYCLE
DOLLAR CREDIT EXPANSION
1945–2008
The postwar dollar system, demographics, globalization and offshore dollar credit drive a multi-decade expansion in private leverage and global dollar liquidity.
2008 GFC
STRUCTURAL PIVOT
The private-credit architecture breaks. Leverage migrates toward sovereign and nonbank balance sheets. The dollar establishes its secular low as the credit regime turns.
DOLLAR CREDIT CONTRACTION
2008–PRESENT
The 2008 GFC marks the beginning of a long deleveraging. Public balance sheets expand to offset the contraction, prolonging the underlying adjustment.
CURRENT COUNTER-CYCLE
MILLENNIAL + AI CAPEX
Millennial demand and AI investment counter post-2008 dollar-credit contraction. The build-out is inflationary; the resulting productivity and capacity are ultimately disinflationary.
MARKET EXPRESSION
U.S. DOLLAR — THE LONG CREDIT CYCLE
The dollar provides the primary market expression of the structural regime above.
1945–2008: Structural dollar decline
2008: Major dollar low / regime pivot
Post-2008: Structural dollar-strength regime
Current cycle: Countertrend expansion within the post-2008 deleveraging regime
The shaded 80–85 zone (?) is where we expect the Build-Out to end. From there, the dollar turns higher as the Reset begins and the credit contraction resumes. Price will confirm it, not the calendar.