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Lead: maximum gray rhino already on the road, should respond as soon as possible!
text | Guo Shiying sources (public number) | a German chief economist editor | Poker investor, please indicate the source
In September the United States did not raise interest rates, it is estimated we all guessed right.
If someone asks: December Federal Reserve will raise interest rates do?
Everyone will say: plus!
Well, congratulations, and got it!
can guess quasi monetary policy trends of the world’s largest central banks, we are very clever?
Not all, should be grateful to the Fed’s well-meaning, they are to normalize monetary policy, spent a lot of time and effort to communicate with the patient global investors.
This suggests that their policy direction is firm and prudent – both to promote the firm, but also try to avoid accidental blow to the real economy and the domestic market.
So far, the Fed has clearly told the market: October started a progressive reduction table, and is expected to raise interest rates three times in 18, 19 years will raise interest rates twice in 20 years will raise interest rates
According to this rhythm, by 2020 the United States can already see interest rates of 3% – the US economy may be higher than the average growth rate of the next few years.
In fact, the US economy has not recovered to pre-crisis levels, did not even reach the average of the past two years.
So, a lot of people it is very difficult to understand why the Federal Reserve to raise interest rates, in particular, is very focused on economic growth and monetary stimulus accustomed to the Chinese people.
Understand, there are two strategic commitment to the Fed’s starting point:
First, try to avoid the US economy is once again fully virtual overheated and triggered global crisis in the near future, that means that the US economy
thorough and global influence decline.
Pernicious subprime mortgage crisis, Wall Street swell again, visionary ahead of the Fed’s obligation to act to tighten monetary strategic initiatives as soon as possible to complete their important mission.
Second, with the highest economic and financial principles of faith to defend the national currency credit and even credit, which is not self-important choice based on the nature of the non-self-mutilation, only time will tell its great strategic value.
Unfortunately, at present determinants of many developing countries, the long-term impact on their economic policies as well as the intrinsic value of the currency is still a lack of sufficiently comprehensive and profound reasoning and attention.
Over time, we believe the Federal Reserve will raise interest rates steady progress in the above table and shrink programs.
The current low inflation is not a barrier, the central bank has become increasingly clever attention to the performance of the asset markets.
Canada’s recent surprise rate hike, sent a signal to the world’s central banks, and are likely to form the next consensus.
Moreover, future inflation is not necessarily depressed, the next few years is reasonably likely to start climbing and CPI continued to rise, and this may become the world’s major central banks to tighten monetary-than-expected future an important motivation – the euro zone, Britain and Japan are
probably next year started the normalization of monetary policy.
on the existing economic common sense point of view, we all know that a large rhinoceros led by the Fed already hit the road.
The problem is that we all consciously or unconsciously ignore this risk, simply because it is not the last we are most afraid of “black swan.”
This is perhaps the case of the Fed expect to see, because it at least shows that they communicate with the market has been a full and effective.
At some future point in time, once the money shrink to a critical point and trigger a systemic crisis, then any hard-hit countries, institutions and individuals no reason to blame the Fed.
Instead, it will be up again after flew, looking at the Fed on the ruins of smoke, its guidelines worship and wisdom.
stock market is still up, bond market yields in developed countries is still in the doldrums, the huge Chinese property bubble piled up, puffing, never thought it would burst.
Prime critical situation is obvious, just look at who should fall in the future.
But before the music did not completely stop, no one is willing to take the initiative to stop their dance, which is everlasting human fate determined by the market.
“Gray Rhino” uniqueness here, it is always there, never hide yourself.
The threat seemed to see very early on, but nothing risk.
So more and more large and looming gray rhinoceros continue to be ignored, so people had also been awake numb, we continue lucky very dangerous ……. Finally one day, a gray rhinoceros knocked placed on the highest point
……. Holy Grail among financial panic, people perhaps do nothing, the market punished by the people in addition to the effect of greed and self-reflection, almost nothing to say.
In the final season of greed and madness market, prices will be the only reason for the rise, speculators who will watch and compare with each other, there will be a lot more difficult market even ultrahigh new ways and new rhetoric, but most
Sly will be the main diversion, withdraw its role.
Developed pattern marked financial innovations, it is easy for them to achieve “out at large, the cover of darkness,” it is difficult to see in advance what clues to flee from the surface, even if the market crashes, still in the dark of the main super short tool
The question remains worrying: the interior of the Chinese economy has a lot of gray rhino, the largest outside face of the Fed gray rhinoceros, whether the future really have a winner?
The answer is uncertain.
After all the ins and outs of gray rhino is an objective reality, and continues to grow.
The only increase the chance of winning is to adjust monetary policy as early as possible, ahead of the release of market risk.
However, China’s central bank, after all, and not the Fed.
Financial wisdom may not be inferior, but matters of faith firm
resistance, policy transparency, stability and independence of the decision-making strategies, etc. There are many reasons disturbing – is still the first weight steady
growth, has not publicly raise interest rates, nor the continued tightening of clear expectations and plans.
It seems everything is still rocking, waiting to see, discretion can be understood as some luck and speculation.
Fear is loose again for various reasons, it is bound to push up asset bubbles, and strengthen the expected depreciation, increased capital outflows pressure that is destined heroic defeat in the next big fight in the international finance – has the renminbi and the property market
Some people think that China’s central bank did not need to care about and to follow the Fed’s monetary policy trend, because in the past it turns out, the Chinese economy and the Chinese central bank has the ability to hedge these external risks.
However, we all know, very serious overcapacity, currency over the next debt accumulation and asset bubbles coexist background, the current international balance of power but capital controls have played a role in the protection of temporary, in addition, there is nothing
advantages and strength – China’s foreign trade surplus to GDP ratio has fallen from 10 percent a decade ago to 1%.
And looking back, catch up with the United States and an important prerequisite for sustainable development is open and the internationalization of the RMB capital now forced to postpone, until then realize huge asset bubble need to have a necessary explanation, and the future of the yuan “gold
“firmness and also need to decide.
Active or passive remains to be seen, we can see that the interest rate cycle has been fully opened up, the time window for the global asset market conduct of the trial is about to open.
It is worth noting that this year has brought supply and demand of the market exchange rate volatility, continued to cool the real estate market in major cities, environmental supervision and contraction of the industrial chain of new conflicts caused by supply-side reform, etc., are becoming
many risks point outside the risk of changes in interest rate policy.
very intense coordination with the Federal Reserve, as well as Chinese real estate market is still crush rhetoric, as well as alternative voices recent Chinese market requirements RRR rate cut.
Although the likelihood of getting the central bank and the relevant policy response is very small, but it at least shows that we are about to become a real threat of external gray rhinoceros, still lack the necessary awareness and preparedness, the overall orientation and layout should be more clear and positive.
China’s economy the most prominent problem is the current monetary excess liquidity.
This money is like a fire on the stove too strong, and too much financial as head of the baking pan, relative contraction of the real economy is not like a cooked pie endure suffering in the hot pan, if we increase the firepower,
it is good and never to eat delicious cake up!
Based on the above analysis, is expected to nineteen large after the next two years, China’s monetary policy should not be loose at least than it is now, so the relevant market should do intend to respond further tightening.
Financial regulators should also be in accordance with the strategic plan of the financial stability work conference, and actively carry out the depth surveillance operations, make the necessary preparations to resist the impact of future significant systemic risk.
There is no doubt that the future security of China’s economy, international influence and positioning of the RMB, depends on the tightness of domestic monetary policy in the coming period.
The Fed continued to tighten, perhaps ulterior motives, but also care about the fortunes of the dispute?
largest gray rhino already on the road, it should respond as soon as possible, while everything is too late!