Editor's note: Originally published at tsi-blog.com on June 30, 2020.
[This blog post is a modified excerpt from a recent TSI commentary]
Financial market discussions and analyses often focus on fundamental issues that don't matter, or at least don't provide useful clues regarding the likely future performance of the market in question. A good example is the so-called "global US$ short position", which is regularly cited in support of a bullish outlook for the US$.
The argument is that the roughly $12 trillion of US$-denominated debt outside the US constitutes a short position that will