Cash is on track this year to outperform both stocks and bonds, something that hasn’t happened since 1990, according to Bank of America Merrill Lynch. And it might all be down to the notion that central bank-fueled liquidity has peaked.

Year-to-date annualized returns are negative 6% for global stocks and negative 2.9% for global government bonds, according to analysts led by Michael Hartnett in a Friday note. The dollar is up 6% and commodities are down 17%, while cash is flat.

Here’s what this has to do with the liquidity story:

[Quantitative easing] & zero rates reflated financial assets significantly. The only assets that QE did not reflate were cash, volatility, the US dollar and banks. Cash, volatility, the US dollar are all outperforming big-time in 2015, which tells you markets have been forced to discount peak of global liquidity/higher Fed funds. Frequent flash [crashes] (oil, UST, CHF, bunds, SPX) tell the same story. Peak in liquidity = peak of excess returns = trough in volatility.

The note speaks to what has become a very important theme for investors. While the Bank of Japan and the European Central Bank continue to provide quantitative easing, the Fed has stopped its asset purchases and is moving toward lifting rates from near zero, as is the Bank of England. The notion that liquidity has peaked and that financial markets must now adjust to that new dynamic.

Indeed, billionaire hedge-fund investor David Tepper earlier this month argued that as China and other emerging-market central banks shed foreign reserves, liquidity is no longer flowing one direction, making for more volatile conditions.

Back to the note. The strategists observed that September has been marked primarily by a “risk-off” theme across markets.

It isn’t all doom and gloom, however. While it is “suddenly impossible to find a bull” (see chart below), there are some positive notes, they said, including the observation that “bond and credit markets are not doing anything freaky right now,” they said. In the event of “true quantitative failure,” falling stock prices would be accompanied by falling credit prices and rising bond yields.

Also, housing markets, the job market and bank lending haven’t reversed their recent recovery and global earnings-per-share figures have already seen a sharp fall, dropping 9.6% from peak to trough.

So what would it take to revive “risk-on” sentiment? The strategists, who recently lowered their year-end target for the S&P 500 SPX, +1.05% to 2,100 from 2,200, said a successful defense of 1,850 would be a positive. “[I]n a world without conviction, investors seek solace in technicals and SPX defending lows is as important as it gets right now,” they wrote.

Also, oil needs to avoid setting new lows, they said. Other positives would include emerging-market rate increases and reforms that allow emerging market currencies to rally; improvement in China’s export growth, which would remove the risk of further yuan devaluation; and the ability of individual investors to continue viewing the recent price action as an overdue correction rather than the start of a bear market.

And finally, there is the need for resilient U.S. domestic demand, “because the best narrative for risk assets in the next three to four quarter is still higher growth/higher rates,” they said.

So maybe it is no surprise stocks are catching a lift Friday from Fed Chairwoman Janet Yellen’s signal that a rate increase by year-end remains likely. See: Yellen’s speech may answer the most pressing question on Wall Street.