The global real-economy money printer is going to run very hot in 2026.
The more spendable money global economies print, the higher the nominal growth impulse we are going to get.
Central Banks around the world are not going to fight it. In some cases, they are going to apply loose monetary policy even in the face of sustained money printing.
The Question Is: What Asset Classes Benefit the Most in This Macro Setup?
Let’s take a step back together and look at the macro big picture ahead of us:
1) Money creation in 2026 will be through the roof: fiscal from US (OBBB), Germany, Japan, Korea etc + AI Capex will contribute to money printing;
2) Central Banks around the world will not be fighting this at all – if anything, they will be looking to on the margin;
3) Housing disinflation will help US sit in the 2.5-3.0% area for a while longer;
4) The setup is: nominal growth at 5%+, Central Banks neutral or loose, ongoing global money printing
A good example of the 2026 concerted switch to fiscal stimulus is Germany, which will shift to a large primary deficit to fund its infrastructure and military spending.
For your reference, here is our projection for the 2026 German money printing activities based on their large fiscal stimulus:
Global money printing correlates with nominal growth: the more aggressively we create new real-economy money, the more likely it is that nominal growth will pick up.
What about global Central Banks? Are they going to stay loose in the face of strong money printing?
The table below shows the Central Bank policy stance around the world – black if around neutral, red if tight, green if loose.
Take a look at the color scale: there is only one tight CB (Brazil), some neutral CBs (+/- 50 bps around neutral), and a big bunch of loose Central Banks around the world. In many cases, the loose policy stance comes from outright ignoring your inflation target.
In the US, Canada and Japan the terminal rate (‘‘2y forward rate’’) is around the neutral rate but there is nothing ‘‘neutral’’ about core inflation – which in all cases sits well above the Central Bank target.
A Central Bank applying neutral monetary policy in the face of core inflation well above their target and ongoing money printing…
…is a very loose Central Bank.
So, what happens to markets in such a macro setup?
As long as US remains under control due to the lagged shelter disinflation, it’s pure Goldilocks here.
Growth is likely to surprise on the upside over the next 6 months, and a passive or even prone-to-cut Fed will end up mechanically loosening the monetary policy stance in the face of stronger growth.
Controlled inflationary pressures, stronger growth and a friendly Fed historically imply strong forward equity returns with a tilt towards international and cyclical exposures.
And here is the key.
After a decade of US/tech dominance and scarce capital flows towards value, emerging markets, and commodities, the world is largely underallocated towards these asset classes.
And it’s exactly these asset classes that seem set to benefit the most in 2026.
Do you own them?
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