Can hot money locked up in a new peak of the stock market bubble?
A shares will end mid-term adjustments or
Zhang Tingbin
heavy volume yesterday's A shares rose late in the shares of medium-term seems to imply mmA adjustment coming to an end.
7 27, the author wrote more than 100% increase has not been adjusted, retail and the Christian Democrats into the market again, A shares at any time there is the risk of technical adjustments, as adjusted to the U.S. dollar and depends mainly on the strength of China's reform and tackling.
had only two days, A shares that ushered in relatively large adjustment, July 29 fell 8.16% largest, was down 5%; 3 days and then another new high of 3478 points, took the biggest fall further 7.96% 4 days. late yesterday strong carryover.
pick up if the A shares rally on this and then, objectively speaking, this adjustment was stronger than I had expected, I was estimated to be adjusted to 15% from top to bottom, it seems like to end adjustments .
this adjustment is to release the first of investors the main point of view, but also the need to consolidate the retail chasing in the stock market as the basis for a new round of increases.
this adjustment is based on department report for the first time the for the first time fears, as if the end of the second.
market has been so sensitive to monetary policy changes, because the current round of stock market rose mainly monetary phenomenon. that is a lot of liquidity into the drive. Of course not deny forty million investment, the top ten industrial revitalization, the role of active fiscal policy, but the latter can only occur after all, is long-term effects.
liquidity comes mainly from two directions. One is the release of credit, first half of the 7.3 trillion RMB release, the financial system has not improved the blood, especially small credit push into the stock market. In 2008, the second and third quarter of turns short A shares, the hot money in the fourth quarter after the encounter blocking China's economic salvation, rescue short squeeze after the hot money, hot money had to Jiancang, which push the stock market reversal. The stock market rose to a certain extent restored property income residents, the economic recovery of China has played an important role in stimulating consumption, first in the world out of China continued to decline, was the most beautiful. It has attracted international hot money China once again into the second quarter of this year, prompting the stock market policy, also lowered interest rates 5 times, but in the world's major currencies is still high, and the central voting issue volume is still at 6.074 trillion (according to Wind Statistics, from January 1, 2008 to yesterday) high reserve Gold was 13.5% to 14.5%. This is actually a little tight monetary policy neutral.
after a period of time, many scholars believe that put too much credit, M2 rose too much, should be tightened, or in the future there will be a new round of bank bad debts. If a country from China alone vertical monetary and credit history, this is a grain of truth. but who hold this view, they obviously forgot to horizontal comparison.
Despite its loose monetary and credit compared, but in Europe and the United States trillions of dollars of direct monetary injections, and the U.S. benchmark interest rate to 0.25% down to 0 interval, and the United States in the hundreds of billions of dollars in direct aid Wall Street firms, compared to RMB interest rates, deposit reserve and the central voting is tight. If in this case, the recovery has yet to consolidate the cases, the contraction of the renminbi, will not only make economic rescue come to naught, but will also directly suppress the price of RMB assets, the objective on the implementation of the loose monetary policy for countries, such as the severe depreciation of the U.S. dollar prior to the acquisition of relatively very low price to create the conditions for RMB assets.
Some would say the stock market bubble is now very, very dangerous. This point of view is only 知其一不知其二, at present, from the world powers, China's asset securitization and financial derivatives, the ratio of GDP is the lowest, also a fold up and down, while the United States on financial derivatives in 2006 relationship between the ratio of GDP is 39 times, asset securitization products is 6.8 times GDP. In other words, even if the total amount of financial derivatives, the United States now shrinking, the U.S. financial derivatives and asset securitization on the ratio of GDP is still 10 times higher than China .
therefore, to focus entirely on the Chinese stock prices, will have the objective effect of blinders, so that domestic investors to ignore the international hot money surging once again why the real reason to invest in China's National Virtual Financial mm total magnification of GDP is very small, that is the true wealth of assets in China is the highest density.
This is not to say that China can sit back and relax it? No, the current strategy of China's biggest financial risk is a serious lack of gold behind the support of the RMB. If in the future dollar collapse, the sharp depreciation of commodity prices, the dollar is to restore credibility, most likely old U.S. 10 dollars for a new, new dollar linked to gold again. If so, the U.S. government and people will be washed off the huge debt, China outside the reserve will be a serious loss.
But how can China do? If the dollar continues to depreciate sharply, the RMB has not appreciated significantly against the dollar, because it would root of the problem of China's economic competitiveness; it can only follow the depreciation of the dollar against the commodity price , that is, inflation in the formation of the RMB. However, once the U.S. dollar trade-in, take the gold reshuffle, due to serious lack of central bank gold, gold and the Chinese yuan pegged very difficult to get, then, the yuan's international status will plummet, prices of RMB assets crash.
for this quite possible the next major strategic risks, the Chinese how to do it? the best strategy is to continue to push up the release of liquidity index (at the same time prices should be suppressed to avoid future retaliation prices of the crash caused a large area of national The ratio of stock thrown, a massive increase in gold reserves. so as to meet future U.S. dollar crash and the old gold to prepare for re-linked.
in the next 6 to 12 months, if the Chinese stock prices rise faster than the international price of gold speed, and people continue to sell stocks to buy gold, then China is the winner; In contrast, if the A shares rose more slowly than the price of gold rose faster, and life and death of people do not buy gold, then China is a loser.
if we do the former, it means we have successfully carried out the international hot money asset bubble peak.
In other words, more than 3500 points, the more the stock market is a more up to escape the game. fled out of the money to buy physical gold, never stop reflexive thrust backwards. or else will be the last to be stuck with you themselves. (for reference only investor making your own risk)
forward to win the world: past paper reviews the July 27, 2009 will usher in
A shares or dollar medium-term adjustment
likely usher in the second round of U.S. stocks rose avalanche
Zhang Tingbin
not necessarily because of economic recovery, which may well signal a sharp dollar depreciation, especially in this time.
in the past 10 trading days, the Shanghai index rose 9.6 %, the Dow Jones index rose 11.62%, U.S. stock market just like flip over, short almost disappeared, which makes a lot of strange market.
If, A rise in shares also find a temporary economic hot money into the stock market credit some of the reasons, then, the Dow rebounded in the early days had up to 37%, in a brief break, once again rising rapidly, it is not a monetary phenomenon of economic phenomena. the international most economists believe that the U.S. economic recovery is still relatively remote from. And the last two months China's foreign exchange reserves data show that hot money flows into China again, indicating that they are not optimistic about the dollar zone assets.
if economic fundamentals and capital flows from the point of view can not be found U.S. stocks rebound to reason, then, most likely, this is the main market for the dollar devaluation expected response.
with this validation, because investors are not optimistic about long-term trend against the U.S. dollar, they continue to throw the United States bonds, resulting in U.S. Treasury interest rates. Last week's close, the U.S. 10-year Treasury bill rate from the beginning of the year rose to 3.65% 2.23%, 30-year bond rate rose 2.68% from the beginning of the year to 4.54%.
an interesting phenomenon is that, since March 2009 since the Dow Jones index and the U.S. Treasury long-term interest rates out of the very % of the year's high points, the Dow Jones index in the June 11 rally stages to reach 8875 points high. After long-term government bonds as interest rates and the Dow Jones index rose again after the callback.
long-term U.S. Treasury rates The rise will lead the United States government bonds, local bonds and corporate bonds overall increase in interest rates, which makes issuers have to pay more interest, and now the U.S. government already heavily indebted, the total debt has more than 100% of GDP, while California this close to bankrupt local governments.
that U.S. companies currently do not do nothing, the U.S. government even if he wanted to repay the interest only of the U.S. Treasury to issue more U.S. interest in print, but it makes people lose faster hh confidence in the dollar which has become one U.S. dollar can not escape the vicious circle.
even more frightening is that if the U.S. dollar bond market, interest rates continued to rise, then it will build a variety of low interest rates on U.S. interest rates expected swap derivatives When collapsed, it will lead to more large-scale avalanche of financial derivatives.
time, the U.S. government and financial institutions will face the second round of the severe contraction of liquidity, and then forced to issue more U.S. dollars, which in turn will further dollar loses its credibility, become the object of selling the U.S. dollar interest rates will further soar hh until one day, the market consensus, the U.S. government is no longer possible on the current version of the U.S. interest, as a pure dollar notes will be out of credit the stage of history, or re-linking with gold.
This is a lot of people who strive to deny the logic, but the market was confirmed with this logic a step by step. Since the first weekend in March 2009 closing, the dollar index out of a very ugly line. If from January 2002 to about 120 points since the process of watching the dollar index, the dollar likely out of the second round of the avalanche market, fell 120 points from the first round of 71 points, 50 points this turn can stop you?
the U.S. dollar against the euro by the U.S. dollar index of six notes from the ratio of weight, in essence, is the price of the dollar against other notes. It will not be sufficient to measure the true extent of the future depreciation of the dollar, because when the leader of credit notes U.S. dollar depreciated sharply against commodity mm, the other notes will have to follow. The true measure of future real depreciation of the dollar is the degree of depreciation of dollar against commodities, particularly the U.S. dollar equivalent of commodities in general devaluation of gold mm.
from gold trend line to see, from the technical analysis, since since March 2008, gold has surpassed 1,000 U.S. dollars mark for the completion of the shock after the consolidation, strengthening of the upper punch and a firm basis of 1000 U.S. dollars.
gold prices once the station steady $ 1,000, then it opens a huge upside: 1. After the gold price is $ 1,000 for the stage will rise, not just 100 U.S. dollars; $ 2.1000 over the gold, with ; gold just a commodity, br> them or still the heart of the last chances, but has been unable to reverse the trend. such as the United States on the new Sino-US strategic dialogue track unilateral expect: namely, 1. to persuade the Chinese to buy U.S. Treasury bonds at the last original capital; 2. coercion in the Chinese yuan sharp appreciation against the dollar. As the RMB is not in the U.S. dollar index basket, the sharp appreciation of the RMB equivalent to U.S. covert shift the burden to the Chinese but no side effects.
However, it is impossible to achieve both expect .1. foreign exchange reserves to buy to buy U.S. Treasury bonds, and the existing cash is very limited to buy U.S. Treasury bonds mm even if the whole crisis on the U.S. rescue only the lesson.
view of this, the second round of the avalanche of dollars will be basically irreversible. And when this trend to continue to interpret the words of the future in the global capital, financial and commodity markets, gold will rise non-renewable commodities, not renewable renewable commodity goods will rise; bulk goods will rise relative to A shares, A shares will rise relative to U.S. stocks; U.S. stocks will rise relative to the euro, the euro against the dollar and U.S. Treasury prices. In short, the U.S. dollar and U.S. Treasury bonds are the worst future investment goods.
rise in China's A shares have a double reason: first, last year, the extreme liquidity crunch as a result of falling asset prices, liquidity is a result of the release of economic recovery, stock market rebound; II Since the expected depreciation of the dollar and the influx of hot money to push to re-stock index. A stock index future may continue to rise, but because the Shanghai index has risen early more than 100% has not been adjusted, retail and the Christian Democrats into the market again, A shares deposit at any time the risk of technical adjustments, as adjusted to the U.S. dollar and depends mainly on the strength of China's reform and tackling.
in such a complicated situation in China is now the opportunity to get rid of the U.S. debt trap. out of the way There are two: 1. Externally, new foreign exchange reserves to buy U.S. treasury bonds are no longer strong, and even seize the opportunity to sell into U.S. Treasury bonds and buy gold, oil and other mineral commodities and overseas; 2. to maintain a relaxed monetary policy, pushing up stock, to encourage residents and investors to sell stocks, investment real estate, purchase of physical gold (as early as hands need to buy physical gold, or the public once the chase is likely to have no market value). so as to prevent future return to the gold standard dollar collapse of the world to create conditions for the risk.
Now, the U.S. credit crisis has not only worried about the future, has been interpreted as an imminent critical situation. It is time to wake up suddenly!
(The author is a senior Finance commentators are for reference only investor decision-making at your own risk ztb6006@sina.com)
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