LIQUIDITY ANALYSIS. NICE RALLY — BUT SPREADS ARE STILL RISING
[Latest Global Dollar Liquidity Measure: +14.5% annual growth rate; latest Endogenous Liquidity Index: -1.8%]

Risky assets rallied nicely yesterday. Thanks to a sharp fall in the VIX, our Endogenous Liquidity Index recovered strongly. But we're not out of the woods yet: that's the message conveyed by credit spreads. Even previously dormant European and Japanese CDS spreads are up!