RouteMaster: Yes. We have experimented extensively with monetary variables, on the basis that these may be leading indicators for asset markets and so we developed Buy / Sell signals based on Liquidity.

We found that the best fit varies between different asset classes and investment perspectives, which we can discuss at another time, but again the chart format is standardised, so you can easily see the relationship, without needing to understand the precise formulation. If you care to have a look at the Test Results again you can see that this kind of analysis produces some very good results.

Here we can see that there has been a very good long-term correlation between short and long-term interest rates consistently over quarter of a century. Since we have found a way to generate Buy & Sell signals for the long end based on information available about the short end at the time, this should prove a simple but powerful investment tool.

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