2017, destined to be an unusual year.
In this year, the global situation wave cloud treacherous, variable after another, whether political or economic, are turbulent, black swan frequent.
Just recently, a war started.
Trump suddenly went to Syria!
According to the Pentagon spokesman, there are currently 59 Tomahawk cruise missiles on the Syrian aircraft, runway, oil logistics storage area, ammunition supply bunker, air defense systems, radar systems to combat.
Have to say, Trump the hands of the successful transfer of the public’s attention, to ease his “through the Russian” and other issues on the plight, and create a tough, agile image, can be described as two birds with one stone.
If Trump’s decision was only a partial war against Syria, then one move (yesterday) of the Federal Reserve was a looting of all the countries of the world yesterday (April 6).
This is the American table.
Yesterday, the Federal Reserve in the “March meeting minutes” clearly mentioned later this year will start shrinking table, and referred to the Federal Reserve officials that the current US stocks unrealistically high.
The so-called shrink table, is to sell domestic assets, and then recover the market circulation of dollars. On the central bank’s functions, the actual monetary tightening is a control measures.
In short, is the ten times the enlarged version of the rate hike!
Interest rate is, after all, policy means, political adjustment is relatively easy. The table is directly adjusted to the central bank’s balance sheet, the central bank’s balance sheet is not a day or two up, not more than a day or two down, once the establishment of the table, then its duration will be longer, the scope of influence And the duration will be bigger and longer.
And Trump’s military strike can ease their own dilemma, the Fed’s table, is also conducive to pass on their own crisis.
If the US table, you can pull high US debt and US stocks, the US high-priced financial assets sold to follow the trend to buy other countries retail, and then wait for the US bond market and the stock market bubble burst, the Fed through the printing and then low Back.
And this, for the other, especially the emerging economies, is undoubtedly a catastrophe!
When the Fed tightens liquidity, the dollar is “less” and “expensive”, global capital will accelerate back to the United States, while emerging countries will be due to the dollar to reduce the debt crisis, and even the currency exchange rate can be demoted The
In particular, China, the United States is China’s most important trading partner, bilateral investment is huge, the economic dependence is relatively high, the Federal Reserve monetary policy is bound to the Chinese economy has a huge spillover effect.
And once the US table, China will bear a huge capital outflow pressure, and the RMB exchange rate, as well as the property market, stock market and other asset prices, will be severely challenged.
At this time the Chinese economy, in the internal and external problems, is facing unprecedented challenges.
Outside, there is a US sharpening, China seems to have to follow the rate hike, take a tight monetary policy.
But the price of monetary policy suddenly tightened is that China can not afford it.
M2 significantly reduced, the RMB suddenly raise interest rates, it will pierce all the high floating in the air of the asset bubble, but also lead to the market “money shortage”, then, the debt crisis will be a large area, a large number of enterprises closed down, the unemployment rate will Soaring
Looking back on China’s past decade’s “money shortage” history, although the background is different, but all monetary policy from the water to tightening, followed the same cycle of economic cycle –
Economic downturn – money flooding – stimulating real estate, housing prices skyrocketed – money out of reality, financial market over – prosperity – real estate investment bottomed out – macro – control tightening – money shortage, debt, stock, devaluation – a chicken feathers.
However, if the continued flood irrigation, relying on investment to stimulate economic growth, the Chinese economy is bound to be more precarious.
China’s money is more and more printed, the current total amount of money has more than the euro area, but also more than the United States. And then such a high growth, will be more than “Europe + America”. In other words, if the Chinese people are holding money for the dollar, not only our foreign exchange reserves is far enough, the world’s dollars are not enough for the!
In the currency under the water, pushing up the bubble of various assets, just real estate, has reached 250% of GDP, far more than the US subprime and Japan crisis level.
While the real economy is more difficult, as a measure of real economic investment is an important indicator of private investment growth in 2016 suffered a cliff-like decline.
It can be seen that the Chinese economy has emerged a serious reality, the stock market ups and downs, the debt market ups and downs, the property market chaos, the exchange rate depreciation is also faster and faster.
April 5, the central bank officials revealed an important signal.
In the Central Party School sponsored by the “Learning Times”, the People’s Bank of China Financial Stability Bureau Lu Lei published a front page of the article, the first disclosure of the highest leadership instructions: to prevent and control financial risks on the more important Position, and resolutely control the total amount of money, find out the risks, focus on prevention and control of asset bubbles.
Combined with Zhou Xiaochuan speech before – March 26, Zhou Xiaochuan president in Hainan Boao speech statement: monetary policy loose has reached the end of the cycle.
This means that China’s economy to take a huge turn!
The central bank floods the end of the era, the management is to change the play, take the “wide financial, tight currency” line, in order to save the real economy, promote economic restructuring.
Standing at the moment, we suddenly realized that everything that happened before was secretly destined to own arrangements. Behind every strategy, have the country’s care and thought.
And we personally, but also to read the national intentions, smooth national strategy, can only be in this troubled capital war, for their own struggle to settle down the house of the fortune.
First of all, why the property market to give up a large killer? Why the state is repeatedly suppressed real estate?
Regardless of the table or interest rate increase, in the short term, for the global risk of assets, will be a challenge. While the adjustment of asset prices must start from the largest exposures.
China’s property market bubble is obvious, but also the most vulnerable to capital breakthrough. It was measured, according to China’s housing prices and exchange rates, only to sell the north of China Guangshen built area of land, you can buy half of the United States.
In view of this, China’s unprecedented real estate regulation and control, in fact, is to respond to the US interest rate hike and take a proactive plan to stay for the future to cope with space.
In this case, do not you have to add a lever to speculation?
I am afraid that the past two years, the property market situation will be very dangerous, the policy for real estate speculators who will not be tolerant. Under the strict control, the short term, some hot city prices appear callback is not impossible.
Second, why the new security zone turned out? Why do the stocks explode?
To retain the capital, the long-term course is the development of the real economy. Now the domestic property market is forbidden to keep clinging, then the domestic so much idle money how to do?
At this time, the new area as a long line of large white shares debut, will naturally attract large capital inflows, not only help to support the construction of the real economy, but also help to prevent capital outflow, in order to achieve a virtuous circle.
While the assassination of the concept of shares, then metaphor of the Chinese stock market slow cow market. Previously, in the two sessions, Zhou Xiaochuan president said, “to encourage enterprises to develop direct financing”, which shows that the state is to revitalize the stock of funds to guide the flow of funds from the property market to support the development of physical enterprises.
However, since it is slow cow, it is bound to need enough patience. Especially in the current situation of turbulence, the global market is likely to be violent fluctuations, the decline will be a high probability of events, so the recent honey sister suggested that you still wet storage to avoid the risk.
Third, why do countries want to increase foreign trade, why should the implementation of “one way” strategy?
To cope with capital outflows, there is a need to increase demand for RMB and reduce demand for the dollar. So as to reduce the US monetary policy, dollar liquidity changes in China’s economic and financial markets adverse effects, so as to be able to effectively prevent the risk of capital flows across the market infection.
How can we increase the demand for RMB?
One is to increase foreign trade, the second is to enable the nationalization of the renminbi, so as to allow more countries in the trade settlement using more RMB to reduce dependence on the dollar. And the implementation of the Chinese side of the way with the purpose of this.
Chinese President Xi Jinping in Davos attended the World Economic Forum speech announced that in May this year, China will host in Beijing, “one way all the way” international cooperation forum.
In fact, this forum, but also in the Federal Reserve to raise interest rates, shrinking step by step pressing, called on the emerging countries Baotuan heating against the enemy policy. The Fed is trying to give the emerging market a lot of money, and Southeast Asia, which concentrated in many developing countries, the region is the most important object.
Therefore, we can foresee the “one way along the way” plan will certainly be the strong support of these emerging countries, which for China’s foreign trade enterprises is undoubtedly a huge positive, and for our individual investors, perhaps in advance layout ” Plate of the great opportunity.
In this global turmoil, we are like sailing in the sea among the passengers, will inevitably be affected by external storms, personal safety in the country on the giant aircraft carrier. Guoqiang to the people strong, the country can only rich people rich.
Since the reform and opening up more than 30 years, the prediction of China’s economic collapse is always endless, but each time let those who sing a deep disappointment.
Although China is still facing enormous challenges, but we believe that uncertainty is the eve of the opportunity, chaos can only be true heroes, China will be in precarious, tempered forward!