Tagged: economic

The era of global economic water release

1. The cooperation model of the global division of labor determines the large-scale release of foreign countries in response to the impact of the epidemic, which is likely to cause domestic imported inflation. This is an external variable that we cannot ignore.

2. Under the background that the new open economic system is gradually taking shape, the domestic economic policy connectivity between China and its major trading partners will become stronger and stronger. Affected by the “trilemma”, it is difficult for China’s monetary policy to survive alone.

3. In a mature financial market, equity investment is undoubtedly one of the best safe-haven assets. At present, we need to lower our expectations of real estate investment returns, while continuing to pay attention to the opportunities and risks of the Chinese stock market.

The era of global economic water release

1. What is imported inflation?

In economics, constant and general price increases are defined as inflation. Since the birth of banknotes, inflation has followed suit. In human history, the serious impact of several large-scale inflations is thought-provoking. Therefore, governments of all countries, without exception, have regarded “maintaining the stability of price levels” as one of the main goals of macroeconomic policies.

In the research on the causes of inflation, imported inflation has gradually attracted the attention of economists. This is mainly because since the middle and late last century, Western developed countries began to transfer the lower value-added links in their manufacturing industries to developing countries in consideration of the comparative advantage of production factors, thus forming a production process covering the world. The so-called global value chain (GVC).

This mode of production has made the global economy increasingly close. In the book “The World Is Flat” by the American economist Thomas Friedman, there is a vivid description of this phenomenon, that is, in the global industrial chain, A multinational company may be headquartered in New York, with a factory on the coast of China, and a listing in Hong Kong, China. Because only in this way, can the cost of production factors required by the enterprise’s production links be optimized.

The increasingly close connection of the global real economy has also made the flow of financial capital in various countries closer. As a result, closely related global financial markets have been formed. Once a country experiences a financial crisis, it will inevitably bring an inevitable impact on its main trading partners and even the global market.

A typical fact is that during the US subprime mortgage crisis in 2008, the Chinese government issued a “four trillion” stimulus policy.

The so-called imported inflation, that is, the international transmission of inflation, refers to the increase in domestic prices caused by the input of external inflation in an open economic system.

Speaking of this, some people may say that since globalization has such a big risk, can’t we not engage in globalization? It is true that there are indeed different voices in the international academic community when it comes to dealing with the impact of globalization. However, this kind of doubt mainly lies in the damage to the interests of developing countries and the uneven distribution of interests within developed countries.

As the world’s largest developing country, it “opens the door for construction” and “utilizes foreign capital is not out of date.” The report of the 19th National Congress of the Communist Party of China clearly pointed out that it is necessary to build a new and open economic system of a higher level. It is the best answer to this question.

2. In the era of global water release, China’s monetary policy is difficult to survive alone

Trade links are the basis of international capital flows, which determine the inseparable financial links between trading partner countries.

At present, China has long been the world’s second largest economy, and has been the world’s largest manufacturing exporter for many years. The latest news from the General Administration of Customs shows that from the perspective of trade volume in 2020, my country’s top five trading partners are ASEAN, the European Union, the United States, Japan and South Korea in order.

With the formal signing of the Regional Comprehensive Economic Partnership Agreement (RCEP) and the completion of negotiations on the China-EU Comprehensive Investment Agreement (CAI), China will have closer ties with the outside world.

The World Bank’s “Global Value Chain Development Report (2017)” shows that under the global production division model, if measured by trade volume, the world has now formed three regional global production centers of China, Germany and the United States.

Therefore, in the post-epidemic era, the monetary policies of the United States, Japan, and Germany are particularly worthy of our attention.

As far as the United States is concerned, in order to effectively respond to the impact of the epidemic, under the promotion of the new US President Biden, the US House of Representatives voted on the 27th local time to pass the US$1.9 trillion economic stimulus plan. Although the plan still has different disputes between the two parties in the United States, mainstream public opinion shows that the implementation of a large-scale post-epidemic economic stimulus plan will be a high probability event.

Looking at Germany again, in order to support the companies and individuals affected during the epidemic, the German ruling coalition has passed an economic stimulus plan with a total amount of up to 130 billion euros.

As far as Japan is concerned, in order to effectively alleviate the economic impact of the epidemic, the Japanese government has launched a third round of economic stimulus plan with a planned total investment of up to 73.6 trillion yen.

In this round of the epidemic, the Chinese government responded quickly and forcefully. On the one hand, it controlled the epidemic, ensured the safety of the people, and handed over an answer that was satisfied with the people and attracted the attention of the world, which can be recorded in history. On the other hand, through a flexible, accurate, reasonable and moderate monetary policy, it has contributed positively to the resumption of work in the early stage of epidemic prevention and control.

However, in the international environment of global flooding, China’s monetary policy has become increasingly difficult to be alone. The central bank’s M2 data shows that since January 2020, the money supply has continued to rise.

Figure 1 China’s central bank money supply (January 2020-January 2021)

Data source: Wind

In the context of an increasingly open economic system, it will become increasingly obvious that the Chinese government’s monetary policy is restricted by the “trilemma”, which brings new and greater challenges to the monetary policy.

3. 2020 may have become the starting point for many asset prices in the next few years

There is no doubt that under the conditions of limited capital account opening, the Central Bank of China has sufficient policy reserves and tools to hedge the negative impact of the epidemic.

However, looking at a longer period of time, the economic stimulus plans launched by various countries in response to the impact of the epidemic will greatly affect the major prices of global assets and will to a large extent become a new round of asset pricing. The base year.

Especially, in the era of global water release, large amounts of foreign exchange reserves cannot avoid the risk of devaluation. For example, the State Administration of Foreign Exchange announced that it will orderly abolish the annual limit on foreign exchange purchases and payments. The signal released is not unobvious.

For us personally, how to start the battle to defend our wealth?

One is to lower expectations for real estate investment. The golden age of buying real estate with your eyes closed and waiting for appreciation is undoubtedly gone. The value of future real estate investment lies in the core areas of core cities, ranging from apartment types, community environment and properties, to education, medical care, transportation and commercial facilities, which will be the core factors that determine the value of real estate investment. “Do not speculate on housing and housing” and don’t try to challenge the central government’s determination to regulate and control real estate.

The second is to attach importance to the opportunities and risks of equity investment. After a year of high light, the risks in the stock and fund markets have become apparent. For ordinary investors, if they do not want to be a leek, it is particularly important to study the basic investment knowledge. Choose a good investment target, master the basic position building skills, save your strength, and be a friend of time. Perhaps the most sure way to fight against an uncertain future.

Finally, talk about an extravagant hope about the freedom of wealth. In those years when housing prices in Beijing were soaring, there was a popular saying among many people, “What were you thinking when the house price in Beijing was 2,000 yuan?” Perhaps some years later, someone might ask, “When the Chinese stock market was 3,000, you were What are you doing?”

The first stock pick list for the Year of the Ox is released!

“Core assets” are too expensive to buy? Take a look at this “stock picking guide.” With the completion of the basic disclosure of the 2020 annual performance forecast, major brokerage research institutes have also adjusted their ratings and target prices for listed companies based on the performance forecast.

In terms of quantity, since late January, the number of brokerage research reports has blown out. Choice data shows that since February, there have been nearly 1,000 company research reports that have only given a “buy” or “force push” rating. The editor combed and found that with the recent deduction of the ultimate leading style of A-shares, many popular leading stocks, including Amic and CDF, have broken through the recent target prices given by brokers.

In addition to these popular stocks, comparing the latest research reports and stock prices of brokerage firms, 43 stocks have an expected upside of more than 50%, of which 8 are expected to double in the Year of the Ox.

Can “Moutais” still go down?

On February 10, CITIC Securities issued a research report and gave Kweichow Moutai a target price of 3,000 yuan. On the same day, Anxin Securities also gave a target price of 2,710 yuan. The latest closing price of Kweichow Moutai is 2601 yuan. If calculated according to the target price of 3,000 yuan, there is still about 15% of the expected upside.

The CITIC Securities Research Report stated that in the short term, non-standard Moutai products are expected to be the first to catalyze growth, maintain the price stability of ordinary Feitian Moutai, and consolidate potential price increases. Looking at the longer dimension, the company has a solid foundation for a steady increase in volume and price, with a high certainty of long-term performance growth, and is expected to fully enjoy the valuation premium. The 2021 Spring Festival dynamic sales will continue to build a stronger consensus. The investment in the liquor sector is still optimistic. Moutai has both offensive and defensive capabilities, and more catalysts are expected to lead the industry to rise.

However, while Kweichow Moutai has recently hit a new high, news of institutions’ reductions in its holdings has also continued to spread. In the fourth quarter of 2020, the world’s largest fund holding Moutai, the “America Fund-Europe Asia Pacific Growth” fund, reduced its holdings of Moutai by 450,000 shares. As of the end of 2020, the fund held a market value of 2.189 billion US dollars, equivalent to 14.195 billion yuan. During the Spring Festival, UBS (Luxembourg) Equity Fund-China Opportunities (USD) also reported reducing its holdings of Moutai. As of the end of January, Kweichow Moutai was the fund’s fifth-largest stock with a market value of 8.16. One hundred million U.S. dollars. Compared with the end of 2020, the fund’s holdings in Kweichow Moutai decreased by 3.66% Spark Global Limited.

“New” risks of the new type “big not to fail”

This year’s Central Economic Work Conference proposed that “strengthening anti-monopoly and preventing the disorderly expansion of capital” is one of the key tasks to be grasped next year. It is necessary to strengthen regulation, enhance supervision capabilities, and resolutely oppose monopoly and unfair competition. Financial innovation must be carried out under the premise of prudential supervision. This has once again aroused the market’s attention and discussion on the new “big to fail” risk.

On December 8, Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, stated at the Singapore Fintech Festival that he should pay attention to the new type of “big not to fail” risks. A few technology companies occupy a dominant position in the micropayment market, involve the interests of the general public, and have the characteristics of an important financial infrastructure. Some large-scale technology companies are involved in various financial and technological fields, and cross-border mixed operations. We must pay attention to the complexity and spillover of these institutional risks, timely and accurate bomb disposal, and eliminate new systemic risks.
risk

So, where is the new type of “big to fail” risk?

What kind of signal does the emphasis on new risks send at this time?

What kind of pattern will financial supervision take in the future?

Recently, a reporter from the “Financial Times” interviewed relevant experts in order to provide an in-depth interpretation of the new “big to fail” risk.

Where is the “new” risk of the new type “big to fail”

“Big to fail” was originally a risk phenomenon for banking financial institutions. Nowadays, some large technology companies and a few technology companies with important financial infrastructure characteristics are also facing a very similar situation, which is called the new type of “big And can’t fall” risk.

“The new type of’big to fail’ risk has emerged with changes in economic and financial forms. We have seen that with the acceleration of economic and financial digitalization, new forms of financial activities and new types of financial infrastructure have been derived.” National Finance Zeng Gang, the deputy director of the Laboratory and Development Laboratory, believes that the “new type” is mainly reflected in the fact that technology companies are not typical traditional licensed financial institutions, but at the practical level, they are engaged in the business of traditional financial institutions. The function of infrastructure is also widely and deeply related to other financial institutions in the business field, and there are new hidden systemic risks.

“In the field of micropayments, a few technology company platforms have a very high market share, are involved in various financial scenarios, involve the interests of the general public, and have important financial infrastructure characteristics. If there is a problem with these financial infrastructures, the operation of the trading system Stability will be greatly disturbed, which will affect the stability of the entire economy and finance.” said Wang Yifeng, chief analyst of the banking industry at Everbright Securities Research Institute.

The data shows that the micropayment market represented by mobile payment is developing rapidly. According to the data disclosed by the Central Bank, in the third quarter of 2020, non-bank payment institutions processed 1,234.45 billion online payment transactions, with an amount of 78.96 trillion yuan, an increase of 22.65% and 23.38% year-on-year respectively; the online platform processing business (through online payment initiated by payment institutions) The online payment business involving bank accounts processed by the Lian platform was 156.122 billion, with an amount of 97.21 trillion yuan, an increase of 43.82% and 40.87% year-on-year respectively.

The risks, complexity and spillovers of some large technology companies’ cross-border mixed operations are more prominent. “Some financial technology companies make joint loans with banking institutions, and a large number of assets are turned into ABS and put on the market. When the scale is small or there are not many counterparties, the systemic risk is not yet prominent, but once the scale increases, the risk The scope of transmission is likely to affect the operation of other financial institutions.” Zeng Gang emphasized.

Take Ant Company as an example. The information disclosed in its prospectus shows that Ant Company has a total credit scale of 2.1 trillion yuan, 98% of which comes from cooperative banks and ABS.

Wang Yifeng believes that financial technology giants are typical platform-based companies with network effects and scale effects. By dismantling financial businesses, they can achieve actual mixed operations and provide cross-cutting financial products, which may intensify cross-market contagion of financial risks. At the same time, large technology companies, as platform intermediaries, rely on scenario advantages to master traffic distribution and form strong bargaining power over financial institutions. This objectively causes financial institutions to rely on technology giants in terms of traffic introduction, customer management, and risk control. .

The report of Beijing City Sub-center is released

A few days ago, Beijing announced the “14th Five-Year Plan” proposal, which mentioned the planning and construction of the city’s sub-center 12 times. As one of the “two wings” of the coordinated development of Beijing-Tianjin-Hebei, what is the current progress of the construction of the city’s sub-center? Which areas will be developed in the next five years?

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On December 15, Beijing held a series of press conferences “Reviewing the 13th Five-Year Plan and Looking Forward to the Fourteenth Five-Year Plan”-a special press conference for the construction of the city’s sub-center. Zeng Zanrong, Executive Deputy Secretary of the Party Working Committee of the Beijing City Deputy Center, Executive Deputy Director of the Management Committee, and Secretary of the Tongzhou District Committee, said that the city’s sub-center has seized the opportunity to relieve the functions of the central city. The regional GDP has exceeded 100 billion yuan and is expected to reach 108 billion yuan this year. , An increase of 57% from the end of the “Twelfth Five-Year Plan” period.

According to the “Beijing Sub-City Control Plan (Block Level) (2016-2035)” approved by the State Council in 2019, the city sub-center is strategically positioned as a world-class demonstration area for a harmonious and livable city and a demonstration of new urbanization District and the Beijing-Tianjin-Hebei region coordinated development demonstration zone.

Zeng Zanrong said that in the past five years, the city’s sub-center has clearly defined the leading functions of technological innovation, administrative office, business services, and cultural tourism. In 2019, the number of national high-tech enterprises increased by 668 from the end of the “Twelfth Five-Year Plan” period, reaching 1,077.

From January to November 2020, there will be 16,769 newly established enterprises in the city’s sub-center, ranking third in the city in terms of increment, an increase of 6.68%. In the first three quarters, the regional GDP reached 78.51 billion yuan, a year-on-year increase of 2%, and it achieved positive growth for two consecutive quarters. Among them, the financial industry realized an added value of 7.13 billion yuan, a year-on-year increase of 29.1%, which provided strong support for economic growth.

In terms of ecological environment, the cumulative concentration of PM2.5 dropped to 37 micrograms/m3, a 60% decrease from the end of the “Twelfth Five-Year Plan” period. The treatment of 53 sections of black and smelly water bodies has been completed, and the water quality of 9 entry and exit sections has all reached the national assessment target requirements. The forest coverage rate reached 33%, an increase of 5.7 percentage points from the end of the “Twelfth Five-Year Plan” period, and the 500-meter service radius coverage rate of park green space reached 91.2%.

Focusing on the construction progress of the “Universal Studios Project” of public concern, Wang Chengjun, Deputy Secretary of the Party Working Committee of Beijing City Deputy Center, Deputy Director of the Management Committee, and Director of the City Deputy Center Engineering Office, introduced that the first theme scenic spot “Future Water World” has been completed and handed over , 17 single buildings including the city avenue, technical service building, food processing warehouse, data center, etc. have all been completed and accepted. The world’s largest, heaviest, heaviest, and most difficult-to-build Global Plaza landmark has been launched. It will be a must for tourists to check in with internet celebrities. The surrounding 32 municipal roads, integrated pipe corridors and pipelines have been completed. .

During the “14th Five-Year Plan” period, the Beijing City Sub-center will also maintain an investment intensity of more than 100 billion yuan each year. Zhang Yanlin, member of the Party Working Committee of Beijing City Deputy Center, director of the Development and Reform Bureau of the Management Committee, and deputy director of the Municipal Development and Reform Commission, said that we have made a preliminary list of projects with a total investment of about 800 billion yuan, mainly focusing on infrastructure, people’s livelihood improvement and Three major areas of industrial development. In the future, the Beijing City Sub-center will also strengthen the coordination and linkage with the surrounding areas, actively undertake the functional easing of the central city, complete the second phase of the relocation of the administrative office area, and promote the transfer of high-quality resources in the central city to the sub-center in line with the functional positioning.

Wuhan quickly “returns blood”

Wuhan’s substantial “recovery”

After Suzhou, Chengdu’s GDP exceeded 1.7 trillion yuan last year, ranking seventh in the country. In recent years, Chengdu has fully seized the opportunities for the development of high-tech industries, attracted a large number of talents, and built high-tech industrial development clusters. It has performed very prominently in the central and western cities.

At the end of 2019, Chengdu had a total of 4,149 high-tech enterprises, an increase of 1,036 over the previous year, an increase of 33.3%; the operating income of high-tech industries was 947.18 billion yuan, an increase of 10.8%. The emerging service industry is booming. The operating income of the Internet and related services, research and experimental development, technology promotion and application services above designated size increased by 32.7%, 24.8%, and 22.0% respectively.

As a national central city, the center of the southwest region, and a sub-provincial city, Chengdu has a total population of more than 16 million people, surpassing Guangshen and ranking fourth in the country. At the same time, Sichuan is the largest economic province in the west and the most populous province in the west, with a permanent population of 83.75 million and a registered population of over 90 million. Therefore, Chengdu’s economic hinterland is quite large.

In addition, Chengdu’s aviation throughput is second only to Beijing, Shanghai and Guangzhou, ranking fourth. According to the latest news released by the International Air Transport Association (IATA), the four cities with the strongest air connectivity in the world are all in China. Chengdu has become the fourth largest city in the world with the strongest air connectivity after Shanghai, Beijing and Guangzhou. .

The competition between the two central and western cities, Wuhan and Chengdu, is also very stale. These two central cities have strong higher education forces. In recent years, during the process of accelerating economic development in the central and western regions, the development of high-tech industries in the two cities has been very eye-catching. Last year, Wuhan’s GDP exceeded 1.6 trillion yuan, ranking eighth in the country.

Affected by the epidemic this year, although Wuhan’s GDP growth rate is still negative, the recovery is extremely strong. In the first three quarters, Wuhan’s total GDP was close to 90% of the same period last year, down 10.4% year-on-year, and the rate of decline narrowed by 9.1 percentage points from the first half of the year. According to local media reports, in the first three quarters, “Wuhan has returned to the top ten in the country”. It can be seen that Wuhan is rapidly “returning blood”.

Ye Qing, a professor at Zhongnan University of Economics and Law, analyzed to a reporter from China Business News that the total GDP of Wuhan is expected to return to the eighth position for the whole year of next year.

Ye Qing also said that Wuhan is one of the top centers of higher education in the country, with abundant scientific and educational resources, but weak in the transformation of scientific and technological achievements. Many achievements and talents flowed to Guangdong and other places. Therefore, the main shortcoming of Wuhan is that the science and innovation industry is relatively weak and lacks the driving force of leading innovative enterprises.

illustration
Hangzhou has strong industrial competitiveness but also has shortcomings

From the perspective of GDP, although Hangzhou’s economic aggregate in 2019 is still far away from the two trillion mark, in terms of industrial development level, Hangzhou is the new first-tier city closest to the four major first-tier cities in Beijing, Shanghai, Guangzhou and Shenzhen.

Among them, in terms of total capital, Hangzhou has exceeded 4.5 trillion yuan at the end of last year, ranking fifth in the country, and continues to closely follow Guangzhou; in terms of A-share listed companies, Hangzhou has reached 155, second only to Beijing, Shanghai and Shenzhen. Ranked fourth in the country.

In addition, an important indicator of first-tier cities is that they have strong talent attractiveness. To measure the attractiveness of a city to talents, the attractiveness of foreign talents, especially those from other provinces, is an important indicator. Generally speaking, first-tier cities can attract talents from all over the country, and the number of graduates from other provinces who are employed in first-tier cities is also relatively high.

According to the “Report on Chinese Employer Demand and White-collar Talent Supply in Autumn 2020” released by Zhaopin.com, Hangzhou’s average recruitment salary reached 9,812 yuan/month, second only to Beijing, Shanghai and Shenzhen, ranking fourth. According to data from the Max Research Institute, the proportion of undergraduate graduates from 2017 to 2019 who are employed in Hangzhou reaches 61%, surpassing Guangzhou and ranking fourth in the country.

Hangzhou’s outstanding performance is mainly due to the rapid development of the digital economy in recent years. Data show that in the first three quarters, the added value of the core industries of Hangzhou’s digital economy was 295.2 billion yuan, an increase of 11.5%, and the growth rate was 1 percentage point higher than that in the first half of the year, accounting for 25.5% of GDP. Among related industries, the electronic information product manufacturing industry grew by 12.6%, and the artificial intelligence industry grew by 10%. Driven by the digital economy, the city’s GDP in the first three quarters reached 1,156.7 billion yuan, a year-on-year increase of 3.2% at comparable prices.

However, Hangzhou’s shortcomings are also very obvious. For example, Hangzhou’s emerging industries have paid too much attention to model innovation, but they are still not strong in technology research and development. In particular, the entire information economy structure is weak, and technology manufacturing needs to be improved. In addition, compared with the first-tier cities, Hangzhou is more like a “single champion”, and the overall comprehensive functions are not small from the first-tier cities. For example, in terms of transportation, the gap in Hangzhou’s aviation and subway transportation is still large.

In addition to Hangzhou, the two cities of Nanjing and Tianjin exceeded 1.4 trillion yuan in GDP last year, which is still a long way from the 2 trillion mark.

The current advantages and shortcomings of these two cities are very prominent. As a megacity in the Yangtze River Delta, Nanjing’s major shortcoming is that its population is relatively small, with only more than 8 million people. It is also the only city with a permanent population of less than 10 million among the six reserve cities with a GDP of 2 trillion. However, Nanjing is the capital of Jiangsu, the second largest economic province. The neighboring Anhui has a rapid economic development. Nanjing has a large economic hinterland. In recent years, Nanjing’s abundant scientific and educational resources advantages have been continuously transformed into scientific innovation advantages.

For Tianjin, the current economic growth rate in North China is relatively slow, and Tianjin is also facing greater environmental pressure.

However, Tianjin’s advantages are also obvious. The “Recommendations on Formulating the Fourteenth Five-Year Plan for National Economic and Social Development of Tianjin and the Long-Term Goals for 2035” issued in full on November 30th stated that Tianjin should make every effort to serve Beijing’s non-capital functional relief and the construction of the Xiong’an New District. . Tighten the “niubi” of easing Beijing’s non-capital functions, and actively serve Beijing, learn from Beijing, and rely on Beijing. Driven by Beijing, Tianjin will accelerate its upgrading and development.

International and China finance12.4

The Fed’s “Beige Book” shows weak corporate optimism
The National Economic Situation Survey Report released by the US Federal Reserve on the 2nd showed that as the new crown epidemic continues to raging, corporate optimism about the economic outlook has weakened. The report shows that compared with the previous report in October, most jurisdictions have achieved moderate or moderate economic expansion, but the economies of four jurisdictions including New York and Philadelphia are still stagnant, and economic activities in some jurisdictions have slowed since early November. In terms of employment, almost all jurisdictions have seen employment growth, but most jurisdictions have seen slow employment growth.

Chairman of 48 British Group Clubs: Eliminating poverty through reform and opening up is valuable experience
Stephen Perry, chairman of the British 48 Group Club, recently stated that “for all countries trying to get rid of poverty, eradicating poverty through reform and opening up is a valuable experience China provides to the world”. Perry said that through decades of determined reforms and open markets, China’s economy has continued to grow, which provides the most important material guarantee for poverty eradication.

OECD: China will contribute more than one-third of global economic growth next year
The Global Economic Outlook report released by the Organization for Economic Cooperation and Development recently predicted that the global economy will grow by 4.2% in 2021, and China will contribute more than one-third of global economic growth. The global economy will shrink by 4.2% this year, and the Eurozone and US economies are expected to shrink by 7.5% and 3.7% respectively. China’s economy will grow by 1.8%, making it the only major economy to achieve positive growth.

The People’s Bank of China China Banking and Insurance Regulatory Commission issued the “Measures for the Evaluation of Systemically Important Banks”
In order to improve the regulatory framework of my country’s systemically important financial institutions and establish a systemically important bank evaluation and identification mechanism, the People’s Bank of China, in conjunction with the China Banking and Insurance Regulatory Commission, formulated the “Measures for the Evaluation of Systemically Important Banks”, which is now officially released. The main contents of the “Assessment Measures” include: First, clarify the purpose of the assessment. The second is to determine the evaluation method. The third is to clarify the evaluation process.

Bank
The central bank launches a 10 billion yuan reverse repurchase operation
On the 3rd, the People’s Bank of China launched a 7-day reverse repurchase operation of 10 billion yuan through an interest rate bidding method. The winning interest rate was 2.2%, which was the same as the previous time. On that day, 80 billion yuan of reverse repurchases expired, and the central bank realized a net return of 70 billion yuan.

The Shenzhen Stock Exchange’s credit protection certificate business officially landed
On the 2nd, the Shenzhen Stock Exchange’s first batch of pilot projects for credit protection certificates was successfully issued, marking the official launch of Shenzhen’s credit protection certificate business. It is understood that this is another beneficial exploration and practice of actively using market-oriented methods to support direct financing of private enterprises, effectively maintaining the healthy and stable development of the exchange bond market, and better playing the role of the capital market in serving the real economy.

China Insurance Innovation and Development Conference will be held in Wuhan
The China Insurance Innovation and Development Conference co-sponsored by the Insurance Industry Association of China and Wuhan Municipal People’s Government will be held in Wuhan on December 6. The theme of this conference is “Assemble the strength of the insurance industry to boost the recovery of Wuhan after the epidemic”, which is divided into a main forum and a sub-forum.

China Development Bank’s 42.5 billion yuan financial bonds were successfully listed on the Singapore Exchange
The 42.5 billion yuan financial bonds issued by China Development Bank were successfully listed on the Singapore Exchange on the 3rd. The listed bonds have maturities of 1, 3, 5, 7, 10, and 20 years, and the issuance rates are 2.78%, 3.19%, 3.38%, 3.44%, 3.69% and 3.98%, respectively. The relevant person in charge of the China Development Bank’s Treasury Bureau said that the listing of China Development Bank bonds on the Singapore Exchange will help better attract Singapore and overseas institutional investors and further strengthen China-Singapore financial market connectivity.

Macau: Fruitful Results of International Infrastructure Investment and Construction Summit Forum
The 11th International Infrastructure Investment and Construction Summit Forum held in Macau closed on the 3rd. The forum attracted more than 1,000 people from all walks of life from 42 countries and regions. At the signing ceremony held on the 3rd, the Chinese and foreign parties signed a total of 12 cooperation agreements, mainly covering traffic roads, housing construction, photovoltaic power plants, wind power and other fields.

and in the final analysis, it is the power of human nature

The market is not always right. In fact, it is full of deception and manipulation. The basic concept of economics is “equilibrium”. Therefore, as long as the current situation is favorable, there will always be someone who will seize the opportunity to make profits. At the same time, due to the pursuit of profits, the free market will also provide some wrong choices
On November 25, on the spot of “finance and economics annual meeting 2021: prediction and strategy”, a wonderful dialogue was staged.
George A. Akerlof, a famous American economist and winner of the Nobel Prize in economics in 2001, and Zhu Min, President of the National Institute of finance of Tsinghua University and former vice president of the International Monetary Fund, discussed the hot economic phenomenon and the social behavior and psychology behind it from the topics of financial market, economic equilibrium, capital story and human weakness.
1、 The market is full of “equilibrium” and “foolishness”, and the weakness of human nature brings profits
In the dialogue, George Akerlof shared his book “fishing for fools” with Robert shearer, hoping to challenge traditional economic views. The market is not always right, he says, but it is full of deception and manipulation. The basic concept of economics is “equilibrium”. Therefore, as long as the current situation is favorable, there will always be someone who will seize the opportunity to make profits. At the same time, due to the pursuit of profits, the free market will also provide some wrong choices.
In George Akerlof’s opinion, in the process of seeking business opportunities, businessmen will inevitably take advantage of human weakness to see whether they can create high profits for themselves. “Once they find such an opportunity, they will choose to take action.”. This phenomenon is called “fishing fool” by George Akerlof, and it is also a kind of “equilibrium”. In this process, if the market lacks restrictions, then every opportunity of excess profit will be fully utilized.
George Akerlof uses many interesting examples to illustrate his point of view. For example, he mentioned that many factories produce particularly cheap snacks. The slogan of a cinnamon roll chain store is “life needs a little sweetness”, which guides consumers to take sweet food as a matter of course and ignore health problems. This is the “equilibrium” and “fishing fool” phenomenon mentioned above.
In this regard, Zhu Min further explained that financial fraud also takes advantage of human weakness. Once they believe it, the cheater will “make up a story to convince themselves”, and things will become more and more serious, and even the financial crisis will happen.

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2、 In the final analysis, behind market behavior is human nature
Zhu Min said that economics is a partial abstract theory. To extend economics to sociology, psychology and other disciplines, we should study the nature of human beings and the spread of stories, including how stories are made up, how to use human weakness to spread them, and how people finally convince themselves to accept the story. This is really a profound theory. For this reason, George Akerlof won the Nobel Prize in 2001.
This is a pure theoretical story, but the theory is so vivid that many things around us are the same. For example, people know that eating sweet food is not healthy, but they can’t help it; people know that smoking is unhealthy, but they can’t help it. So in this sense, we are far away from rational people. Adam Smith’s general equilibrium does not exist. This is a very important observation and a very important theoretical insight.
Zhu Min said that at this time of the day, it is still necessary for Caijing to invite a theoretical economist to talk about the theory. When we are concerned about the fluctuation of the stock market, the flow of the capital market, and the growth and fluctuation of the economy, we can see that behind the events, people are pushing forward. These are the forces of human nature playing a role and are all stories. Therefore, it is very important to understand market behavior and market equilibrium from the perspective of human weakness, and to understand the existence of error, foolishness, fraud and ignorance, which will make us far away from the concept of ideal equilibrium. In the final analysis, the market exists in the human society, and it is people who constitute all the actions to promote the development of the market. So when we look at the appearance of an event, we should still see people’s behavior and motivation from behind.
In the final analysis, to see people’s behavior, human weakness and the spread of stories is the most fundamental to understand all financial behaviors and financial markets today.
The following is the transcript of the dialogue:
Wang Boming: Good morning, ladies and gentlemen! Welcome to the annual Caijing annual meeting. Today, I would like to say that the annual meeting of Caijing was held in Tongzhou for the first time. Speaking of Tongzhou, I would like to say a few more words. Secretary Zeng is also here. In the past ten years, I have been to TongZhou twice. I am very sorry. I came here two months ago to attend the annual financial meeting of Tongzhou and heard about the development plan of Tongzhou. Just now, Secretary Zeng said that TongZhou’s future planning may require investment of nearly 800 billion yuan. What is the amount? Let’s imagine that when you go to Shanghai, you will see Pudong, which is shocked by the skyline of Pudong. In the next five to 10 years, if this plan is realized, we will also see a skyline of Beijing in Tongzhou. So I still say that. My mind is still in Tongzhou ten years ago. At that time, it was called Tongxian. Now it is called Tongzhou, the vice High School of Beijing Heart. In the next five to 10 years, it is hoped that the sub center of Beijing will be removed and TongZhou will become the real center of Beijing.
The annual meeting of Finance and economics in 2020 is indeed full of challenges, not one

The Dow soared by more than 300 points

Market Pulse

The positive news of the new vaccine on Monday once again boosted investor confidence. The S&P 500 index closed up 20.10 points, or 0.56%, to 3,577.60 points; the Nasdaq index closed up 25.70 points, or 0.22%, to 11880.63 points; the Dow Jones index closed up 327.80 points, or 1.12%, to 29591.27 points.

New energy automobile stocks rose sharply, Tesla rose 6.5%, Xiaopeng Motors rose nearly 34% to 72.17 US dollars, the total market value exceeded 50 billion US dollars. Ideal cars rose by more than 14%, and Weilai rose by more than 13%, reaching new highs.

Economic Calendar:

The fifth “1+6” round table dialogue

15:00 Germany’s final quarterly adjusted GDP quarterly rate in the third quarter (%)

17:00 Germany November IFO Business Climate Index

19:00 UK November CBI retail sales difference

22:00 US September FHFA house price index monthly rate (%)

23:00 Consumer Confidence Index of the US November Consultative Chamber

 

►►On November 23, Foreign Ministry Spokesperson Zhao Lijian presided over a regular press conference. A reporter asked a question. According to a draft US list disclosed by the media, the Trump administration is about to announce that 89 Chinese companies are “related to the military” and will restrict them from purchasing a series of US products and technologies. What is China’s comment? Zhao Lijian said that China firmly opposes the unprovoked suppression of Chinese companies by the US and has stated its solemn position on this many times. What the U.S. has done seriously violates the market competition principles and international economic and trade rules that the U.S. has always advertised, and will inevitably harm America’s national interests and its own image. Chinese companies have always adhered to operating in compliance with laws and regulations, and strictly abide by the laws and regulations of various countries, including US laws, in their international operations. The United States should stop generalizing the concept of national security and suppress the wrongdoings of foreign companies.

►►The China Banking and Insurance Regulatory Commission has recently approved in principle Baoshang Bank to enter bankruptcy proceedings. The China Banking and Insurance Regulatory Commission’s Reply on the Bankruptcy of Baoshang Bank Co., Ltd. stated that Baoshang Bank should carry out follow-up work in strict accordance with the requirements of relevant laws and regulations, and promptly report to the China Banking and Insurance Regulatory Commission in case of major situations.

►►Notice of the State Administration of Radio and Television on strengthening the management of online show live broadcasts and e-commerce live broadcasts. The online show live broadcast platform shall implement real-name management for network anchors and “rewarding” users. Users who have not registered with the real-name system cannot give rewards, and minor users cannot give rewards. Measures such as real-name verification, face recognition, and manual review shall be adopted to ensure that the real-name system requirements are implemented and the reward function of underage users is blocked.

►►At around 18:30 on November 23, 2020, the Long March 5 Yaowu carrier rocket began to fill with liquid oxygen and liquid hydrogen cryogenic propellant. It is planned to launch the launch mission from 4 am to 5 am on the 24th. This is the second applied launch of the Long March 5 series of carrier rockets. It will transport the lunar exploration project Chang’e 5 probe to the Earth-Moon transfer orbit, and implement my country’s first extraterrestrial celestial body sampling and return mission. The launch window time of the Long March 5 Yaowu rocket is based on comprehensive consideration of the earth-moon position relationship and other factors, and the best launch time is selected after orbital design.

►► Qinghai Barley Wine responded to the Shenzhen Stock Exchange’s concern letter, stating that the company, controlling shareholders and actual controllers do not have major matters that should be disclosed but not disclosed about the company, or major matters that are in the planning stage. The company’s controlling shareholder, Huashi Investment, reduced its holdings of 720,000 shares during the stock transaction period, accounting for 0.16% of the company’s total share capital. On July 30, it disclosed the “Announcement on Pre-Disclosure of Controlling Shareholders’ Share Reduction.” Highland barley wine has six daily limit in the past nine trading days.

►►Hangzhou Hi-tech announced at night that the company could not get in touch with the company’s actual controller, Lu Junkun, and he was in a state of disconnection. Up to now, the company has not been able to understand the specific reason why Lu Junkun lost contact. Lu Junkun has resigned from the company’s chairman, director, and strategic committee member on September 11, and no longer holds any position in the company. At present, the loss of contact has not affected the company’s production, operation and management stability.

►►According to the Shanghai Clearing Exchange’s announcement, Yongcheng Coal and Electricity Holding Group Co., Ltd.’s seventh phase of ultra-short-term financing bonds (20 Yongmei SCP007) and the fourth phase of ultra-short-term financing bonds (20 Yongmei SCP004) in 2020 should Cashed on November 23. As of the end of the payment due date, Yongcheng Coal and Electricity Holding Group Co., Ltd. failed to raise full payment funds as agreed, and failed to transfer the payment funds to the custodian institution on time and in full.

Haitong Securities: During the bull market, funds alternate between the main road and the auxiliary road due to the gradual change in fundamentals. In the first half of this year, technology and consumption led the rise, the early cycle of the third quarter rose, and the cycle after the fourth quarter is beginning to exert force. The pattern of the bull market has not changed. In the short and medium term, post-cyclical finance is better, and the main line of the medium and long term is still technology and domestic demand that represent transformation and upgrading.

Galaxy Securities: Looking ahead to A-shares, the current market’s upward momentum has shifted from liquidity-driven to fundamental-driven. The game of stock funds has caused hot spots to rotate rapidly, and the price-performance ratio of buying is particularly important. It is expected that short-term fluctuations will continue within a narrow range to accumulate momentum. , The long-term upward direction has not changed. The end of the year and the beginning of the year are a good time for the layout of high-quality white horse stocks to be adjusted in depth. In the context of economic recovery, performance is still an important support for the future long-term layout.

Kaiyuan Securities: The market continues to fully interpret the cyclical market, the pro-cyclical low-valuation sector has become the main force, and the changes in the macro economy have begun to enter the cognitive vision of more and more investors. The global economy is entering a post-epidemic recovery. The real estate recovery in the United States, the implementation of stimulus bills, and corporate inventory replenishment are on track; supply recovery is often slower than demand during economic recovery, and global re-inflation transactions are emerging; supply and demand patterns are reshaping after the epidemic , China’s manufacturing industry is showing resilience and expansion capabilities in the global industrial chain turmoil.

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International finance11.24

The 15th G20 Summit reached consensus on five major economic and trade outcomes
A few days ago, the 15th summit of the leaders of the Group of Twenty (G20) was held in the form of video. All parties reached consensus on a series of major issues. Among them, five aspects of practical results were reached in the economic and trade field. One of the economic and trade achievements is the approval of the “Group of Twenty Countries’ Response to New Coronary Pneumonia and Support for Global Trade and Investment Collective Action.” Second, reach an important consensus on safeguarding the multilateral trading system and advance the necessary reforms of the WTO. In terms of its commitment to keep the market open, the G20 proposes to ensure fair competition and create a free, fair, inclusive, non-discriminatory, transparent, predictable and stable trade and investment environment. In improving the sustainability and resilience of global supply chains, we pledge to help developing countries and LDCs better integrate into the trading system. The G20 has also formulated policy guidelines to encourage small, medium and micro enterprises to actively participate in international trade and investment to promote inclusive economic growth.

IMF official: China’s continued deepening of reform and opening up will help build a new development pattern
In a written interview with a reporter from Xinhua News Agency, Helge Berger, Assistant Director of the International Monetary Fund’s Asia-Pacific Department and Director of China Affairs, said that China’s economy is recovering rapidly from the new crown epidemic. China has launched a series of deepening reforms and opening up. The measures will help promote China’s domestic economic growth and help build a new development pattern in which domestic and international cycles are the mainstay and the domestic and international dual cycles promote each other.

Biden announces “team roster”
US “President-elect” Biden announced a series of cabinet members on the 23rd. Among them, Anthony Brinken was nominated as Secretary of State, Majorcas as Secretary of Homeland Security, Avril Haynes as Director of Intelligence, and Jack Sullivan Served as National Security Advisor to the White House, and Thomas Greenfield served as the Permanent Representative of the United States to the United Nations. According to CNBC reports, Biden will nominate former Federal Reserve Chairman Janet Yellen (Janet Yellen) as Secretary of the Treasury. If finally confirmed, Yellen will become the first female Treasury secretary in American history.

Germany’s November comprehensive PMI fell to a 5-month low
According to the monthly survey results released by the market research institution Esson Huamai on the 23rd, Germany’s November comprehensive purchasing managers index (PMI) fell from the final value of 55.0 last month to 52.0, the lowest point in five months. The survey showed that due to Germany’s lockdown measures in response to the new crown epidemic, the German service industry PMI in November fell to 46.2 from 49.5 last month, and the manufacturing PMI fell to 57.9 from 58.2 last month.

Singapore raises its economic growth forecast for this year
The Ministry of Trade and Industry of Singapore issued a report on the 23rd that, taking into account the domestic and foreign environment and the country’s economic contraction of 6.5% in the first three quarters, the expected growth rate of Singapore’s GDP in 2020 will be from -7% to -5%. “Adjusted to “-6.5% to -6%”. Singapore’s Ministry of Trade and Industry predicts that Singapore’s economy will resume growth in 2021, with an expected growth rate of 4% to 6%.