Hydroblunt made an excellent point about central banks not being the sole liquidity providers these days. Markets are truly globalized and the tight credit spreads (proxy for liquidity) you see today are partly a result of the FED raising rates in the past two years. The FED has tried to temper inflation expectations and has inadvertantly jump started a MASSIVE carry trade between Japan (1% ir). For credit spreads to widen and the liquidity crunch to hit corporations, there will be a catalyst, most likely japan raising rates and everyone unwinding the carry trade by dumping US debt/$ and buying back Japan assets used to finance this type of trade. Even if the global economy keeps a modest pace, the unwinding that well see by global banks, hedge funds and whoever else has a hand in this free money trade, will exacerbate spreads in the short run via liquidity eradication, causing the belly and long end of YC to finally show some risk !
Wow. ML supposed to be perma bull. I had to check different sources to verify this post just to make sure it is from ML