Withdrawing liquidity

Noland:

"I do read commentary that the Fed and global central bankers have been “withdrawing liquidity.” I don’t see it. For starters, the vast majority of global liquidity these days emanates from private-sector debt growth and securities leveraging. Keep in mind that Credit is growing at double-digit rates across the globe. The Federal Reserve’s balance sheet has become virtually irrelevant to the global liquidity-creation process, and the Fed has not been selling securities to reduce liquidity in the system (and they would have to sell a large amount today to offset record Credit growth!). For central banks to actually “tighten” policy would require an overall global rate environment sufficiently restrictive to induce private borrowing and leveraging restraint. I’m still waiting."