Chapter 310: Some Further Inferences on Future Situations
Monday, July 1, 2024.
Jisi Lu: 4.38, Shanghai Composite Index: 2965 points.
Today, the Shanghai Composite Index continued its big rise from last Friday, rising from the lowest point of 2961 points to 2994 points, an increase of 0.92%, just one step away from 3000 points.
During the trading session, real estate, coal, oil, nonferrous metals, banking, insurance and shipbuilding led the gains, and only the liquor sector fell against the trend.
It seems that funds are fleeing the liquor sector and are following the mid-year report market;
At the same time, the broader market has begun to become desensitized to the sudden collapse of the liquor sector.
With two consecutive days of big gains, the mood of stock investors has gradually become high, and they have completely forgotten the despair that the Shanghai Composite Index has been falling for more than a month, at a 45-degree angle, from more than 3,100 points.
If there is another bullish candlestick tomorrow,
The shouts that the bull market is back will surely fill all forums.
Three big bullish candlesticks, thousands of troops come to meet.
Industry News:
The stock market has been developing silently, and its underlying logic has been reconstructed unconsciously. In the past three days, there have been several important things that require special attention.
1. Rumor has it that the Arab League announced that Hezbollah is no longer a terrorist organization; the US amphibious assault ship USS Wasp entered the Mediterranean.
The Lebanon-Israel conflict continues to brew.
If the war breaks out again, it will be a huge bustling scene with outbreaks everywhere.
2. In Argentina, four lithium mines will be put into production in the second half of the year, and production capacity will increase by 79%.
Before the formation of a lithium version of OPEC and collective production cuts, the price of lithium ore is not optimistic, and this sector can only be watched from afar.
3. Big news: The "Collective Economic Organization Law" has been passed and will be implemented on May 1 next year.
The rich will help the poor.
After the urban economy developed to the modern stage and encountered bottlenecks, the development of the rural economy was finally placed at a strategic level, instead of simply making transfer payments as before.
It can be said that in the previous 30 years, against the backdrop of large-scale real estate development, the urban economy has been thoroughly developed both in space and time.
Of course, various problems also arise.
For example, the gap between the rich and the poor has widened.
For example, the excessive financialization of the urban economy has led to excessive exploitation of grassroots citizens, and so on.
Now, ahead of the July meeting.
In the context of completely abandoning the use of real estate to drive economic growth, shifting gears to developing the rural economy is indeed necessary to ensure the realization of common prosperity, narrow the urban-rural gap, and thus achieve interactive urban-rural development rather than a binary opposition between urban and rural development.
In the future, internally, development opportunities lie in rural areas; externally, they lie in the Belt and Road Initiative in Asia, Africa and Latin America.
4. Second quarter meeting of the YH Monetary Policy Committee.
Note the statement: "We must strengthen the implementation of the monetary policies that have been issued. Maintain a reasonable level of liquidity, guide reasonable credit growth and balanced supply, and keep the scale of social financing and money supply consistent with the expected targets for economic growth and price levels. Promote a moderate recovery in prices and keep prices at a reasonable level."
And: "Comprehensive measures should be implemented to correct divergences, stabilize expectations, resolutely correct pro-cyclical behavior, prevent the formation of unilateral and self-reinforcing expectations, and resolutely guard against the risk of exchange rate overshooting."
The trend of domestic monetary easing remains unchanged.
However, we must also remain vigilant.
Once the United States starts to cut interest rates, my country is likely to start a cycle of raising interest rates.
This time point is estimated to be around the middle of next year, by which time there will be another round of logical reconstruction.
By then, due to the narrowing of the interest rate gap between China and the United States, a large amount of financial arbitrage funds will most likely flow from the United States into my country, thus forming an inflation bull market with capital reflux.
5. According to reports, "central state-owned enterprises are accelerating the cleanup of their financial equity holdings" and "there have been 17 such transactions since November last year."
Under the "refund order", many licenses and equity in various industries such as banking, insurance, securities, and trust were stripped away one by one by central state-owned enterprises.
Many people, including us, believe that this will not have a significant impact on the financial sector.
However, in the stock market, one must always be wary of others.
We still need to remain vigilant when it comes to the banking, insurance, securities and trust industries.
Shareholders exchange:
1. “Cesar who loves Haihong”: Do Shuanghui authors know about it?
I've read about it before, and just watched it again.
The dividend yield seems pretty good.
However, the premium ability of such enterprises is not particularly strong. They are constrained by soybean meal and pork prices upstream, and face fierce competition from homogeneous products such as Jinluo downstream.
Compared with Moutai in the liquor industry and Pianzihuang in the pharmaceutical industry, its gross profit margin and industry dominance are much lower.
At a time when the consumer industry is generally sluggish, if you want to participate, you need to make a plan.
Recently, major stock forums have begun to collectively brag about "high dividend stocks", but few have hit the point.
The reason why "high dividend stocks" continue to rise is not only the pursuit of high dividend stocks in the reality of low interest rates, but also the purchase of hard assets in the cycle of large inflation in order to preserve and increase the value of cash.
At this stage, the economy in our country is showing deflation, but on a global scale, we can see that the overall value of paper money is depreciating relative to commodities.
This can be seen from the rise in international commodities, especially gold and silver, in recent years.
2. “Big Cows Travel the World”: Can we talk about it? Why?
Throughout the dynasties, taxes have been the foundation and determined the rise and fall of dynasties.
Before, 30 years ago, the tax was on real estate. After that, where the tax will be will depend on this meeting.
This is a system, a direction, and the future.
Finally, I think of a question we have calculated before:
What if the United States does not cut interest rates and even raises them, causing a hard landing of the economy?
I have thought about this for a few days and believe that if the US economy experiences a hard landing, it will trigger a new round of global financial crisis.
Faced with the situation of a damaged domestic economy, sluggish external demand, and a large number of industrial workers unemployed, I believe that my country will introduce a series of major strategic regulatory measures.
First, internally, revitalize the rural collective economy, promote rural economic take-off, and advance the development of the western region.
Second, externally, we will implement a Chinese version of the "Marshall Plan" with Chinese characteristics, exporting infrastructure to Asian, African and Latin American countries along the Belt and Road Initiative.
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