Numerous explanations have been offered for the latest bout of volatility in financial markets. The one unmistakable message from this market volatility is that it is all about credit.

Yellen has wanted to nip a brewing asset price bubble before it was too late. January's market selloff has accomplished her intent. Now she take her foot off the brake.

Do not be distracted by conventional presumptions about the Fed’s tightening cycle and interest rates. The ultimate bogeyman of this investment cycle will be credit quality and the warning sign will be when banks tighten lending standards.

The addition of the Chinese renminbi to the IMF's basket of reserve currencies is likely to accelerate foreign access to China's debt markets, one of the most significant milestones in integrating China into the international financial system.

In October, I joined Dr Woody Brock and PIMCO's Fed watcher, Tony Crescenzi, and 18 senior practitioners for a workshop organised by PortfolioConstruction Forum on where global monetary policy was headed. Three key views emerged.

In all of '87, '98, '05 and '15, the US economy was close to full employment, inflation was tame, commodity prices low, EMs were under financial strain, volatility roiled financial markets, the US dollar was strong, and US monetary policy excessively generous. What followed?

I don't believe this week's market corrections portend the ultimate downturn in this investment cycle. The endgame will take a few more years. Here are some market, currency and China milestones to watch for to check this view is correct.

This week, Chair of the Federal Reserve Janet Yellen has repeatedly said it is likely the Fed will lift its policy rate at its September meeting. It will be a minor adjustment but a momentous event. In short, I expect the first 100 basis points of Fed normalisation will have relatively little effect on long-term rates - with a critical caveat.

This week, Portugal's sovereign bonds traded on negative yield - flying in the face of any sensible assessment of credit risk. There seems to be little chance that the ECB's belated and oversized QE program will end gracefully. Policy blunders never do.

Slow growth is an old story. The new story is that world is finally beginning to re-balance - a process that unfortunately will take another 20 years. Well-intended policies are causing bubbles and distortions to asset prices.

Fixed income markets seem to have gotten the correct message, albeit perhaps for the wrong reasons – short-term interest rates will stay low for a long time.

Now the Fed has opened the door to normalising interest, what constitutes "normal"? Take care in stretching for yield now the Fed is no longer making promises.

The consensus of FOMC participants expects core inflation to revert toward the 2% target over the next two years. I think they will be wrong.

As long as policymakers can stay on course and avoid the policy mistakes of the late 1990s, the oil price collapse could prove more therapeutic than destructive.

The answer seems obvious. But more complicated forces are at work that have reduced real interest rates far below historic norms and may keep them very low for many years.

China has about five years to lay the groundwork for the transition to a new monetary policy framework with a currency that is sufficiently flexible.

Speculation is building that the Fed will surprise financial markets with a new framework for forward guidance, perhaps as soon as the FOMC meeting on 16/17 September.

The Fed's published policy on how it will exit QE is fairly old. Overall, though, there is not a huge overhang of securities that the Fed needs to sell to exit.

The Fed's clear message from yesterday's FOMC meeting is that it will stay the course on exiting QE as gracefully and slowly as possible.

If the US and China prove to be prescient and 'ahead of the curve', financial markets will flourish; if they dawdle, we'll see yet another boom and bust cycle that ends in tears.