First, I want to thank Ed D’Agostino for the kind shoutout in his introduction to his recent Global Macro Update, “The Bill for ZIRP Is Coming Due: The Mania Begins.” His recognition, which means a great deal to me, rekindled fond memories of the time Ed and I were in Havana with a GIC delegation visit to the Cuban Central Bank and various government ministries. Unfortunately for Cuba’s citizens, recommendations from our dialogue were ignored by their government.
Those experiences remind me how valuable it is to share perspectives in diverse settings, whether on the ground in Cuba or in thoughtful interviews like this one. That’s why I strongly encourage you to listen to Ed’s entire interview with Michael Howell of CrossBorder Capital. It’s a valuable discussion about global liquidity, debt refinancing, and the forces shaping today’s markets.
While Michael never uses the exact term rollover risk, he does an exquisite job of describing it and what it means in global finance. Any investor in any asset class will find this interview thought-provoking and useful.
In summary, Michael Howell argues that global liquidity—the balance sheet capacity of financial institutions—is the true driver of asset markets, more important than interest rates. With global debt around $350 trillion, roughly $70 trillion must be refinanced annually, making liquidity cycles central to market stability. Howell argues that these cycles average about 65 months, with crises occurring when debt overwhelms liquidity and bubbles forming when liquidity is abundant.
Howell responds to Ed’s excellent questioning by warning that we are currently in the speculation phase of the cycle, where excess liquidity fuels risky behavior but the underlying debt pressures remain unresolved. His advice to investors is to prepare for turbulence, favor commodities and gold, and recognize that crypto assets are highly sensitive to liquidity shifts.
Howell makes at a series of vital points and explains them in detail you don’t want to miss. For my part, I would qualify one of those; and that is his argument that Federal Reserve balance sheet actions matter more than interest rates in determining liquidity. I don’t think that this is the case as long as the Fed maintains a positive “real” policy interest rate. In my opinion, it is a zero or negative real policy rate that triggers disruption and financial market turmoil.
Overall, this interview is a must-listen. Thanks again to Ed. I invite interested readers to enjoy the recommendation for Sidney Homer’s historical treatise on interest rates, too. I’ve consulted A History of Interest Rates, now in its fourth edition, many times. You will find it among the citations in our new book, The Fed and The Flu: Parsing Pandemic Economic Shocks.
Below is the link to Ed’s introduction and the interview.
Global Macro Update, November 26, 2025
“The Bill for Zirp Is Coming Due: The Mania Begins”
https://www.mauldineconomics.com/global-macro-update/the-bill-for-zirp-is-coming-due
