Chapter 320: Expect a Protracted War
Thursday, July 25, 2024.
Jisilu: 3.01 Shanghai Composite Index: 2891
A few days ago, the political situation on the other side of the ocean was turbulent, international commodity prices plummeted continuously, and the domestic stock market was turbulent.
Faced with such an event that will go down in history, anyone's mind would be confused at first.
Faced with such huge uncertainty, any investor would be at a loss at first.
This is also the reason why Li Feng was so confused a few days ago.
Fortunately, after a few days of sorting out and thinking, the way forward gradually became clear, and I gained some confidence.
In other words, he continued to brag and gamble in the stock market.
1. The overall world situation has entered a new stage of development.
It needs to be emphasized again that the declaration made the day before yesterday (Beijing J) is very important.
To a certain extent, this is the official announcement of a proxy war launched by China, Russia and all parties in the Middle East against the United States and Israel.
It is very likely that this is a move from comprehensive defense to strategic counterattack.
Today, the competition between China and the United States has reached an extremely critical moment.
In terms of military, China and Russia have joined forces with Middle Eastern countries to contain the power of Europe and the United States in Europe, the Middle East, and even Africa.
Economically, China is making breakthroughs in the field of information technology, namely the two most critical links: chip manufacturing and operating systems.
In addition, in the automotive field, a groundbreaking transformation has begun to replace fuel vehicles with smart vehicles, which will completely wipe out the automotive industries of Europe, the United States, Japan, South Korea and Germany from the southern countries.
The United States has launched a financial war of attracting deposits with high interest rates, continuously raising interest rates and siphoning capital from various countries, especially China, in an attempt to explode its domestic assets.
It has begun: low blood pressure versus high blood sugar.
Therefore, this is the reason why the US stock market has been rising continuously and the A-share market has been falling continuously in recent years.
Because the funds have been sucked away, and we dare not flood the market with money.
Last night, the U.S. stock market plummeted, especially Nvidia, a leader in the information technology field, which plummeted nearly 7%, Tesla fell more than 10%, and the Nasdaq fell 3%.
Key point: The former third-in-command of the Federal Reserve changed his tone and said he supports a rate cut in July.
If I had known this would happen, I wouldn’t have done it in the first place.
Perhaps it is precisely because of the greed of European and American capital that during the interest rate hike cycle, they often extend the time of interest rate hikes through constant expectation management, so that banks and other financial institutions can make a fortune (usury) under the background of high interest rates.
As for people's livelihood and manufacturing, they don't care at all.
To the extent that, almost every time the interest rate is cut, it is when the U.S. stock market plummets or is on the verge of a financial recession, and they have to cut interest rates and print money to plunder the world to save their own lives.
When a whale dies, all things come to life.
The collapse of the United States and the interest rate cuts are most beneficial to the current A-shares because a large amount of funds will flow back to my country.
But, the most bizarre thing now is,
However, many people are panicking, fearing that the US market will plummet and that the US economic recession will affect A-shares and our country.
This is ridiculous.
If this was said in 2007, or even around 2013, it would be correct.
Because, at that time, my country's economic system was dependent on the US economy and formed a large cycle of the world economy.
If the United States raises interest rates, we will definitely raise interest rates. If the United States lowers interest rates, we will definitely lower interest rates.
When one prospers, all prosper; when one suffers, all suffer.
But now, the Chinese and American economies have very clearly parted ways and decoupled, and a huge interest rate gap has appeared between China and the United States.
On one hand, there is hypoglycemia, which means that while lowering interest rates, various channels for capital outflow are cut off; on the other hand, there is hypertension, which means raising interest rates and attracting deposits at a high level.
At this moment, the U.S. stock market has plummeted and the U.S. has cut interest rates. This is a good time for capital to flow back, coupled with my country's effective monetary easing.
This is good for my country's stock market.
However, many people still relied on their impressions and fled in panic.
There are also many people who take advantage of the situation to loot.
And, it is very likely that there are bad people who are letting wolves into the house. (This situation, as far as I remember, was described in a previous article)
But, although this event is certain.
But you don't know when this will happen.
And, once it happens, will it create a deep pit, or will it provide an opportunity to enter the market at a low point.
So, maybe it's a bit too greedy.
Some people were so caught up in the excitement of predicting an interest rate cut and the smooth rise in commodity prices in the previous months that they did not make corresponding plans.
As a result, we have to fight it again like we did in 2020.
However, this time is different from that time, it should be pulled back soon, right?
Of course, we must also be prepared for a protracted war and hold our shares until the day when the U.S. stock market plummets and forces the Federal Reserve to cut interest rates.
2. In fact, our helmsman is very clear about this.
The prediction of the Sino-US dispute is long-term and lasting, and cannot be achieved in one day or one year.
Moreover, they are taking advantage of this external pressure and this once-in-a-lifetime opportunity to carry out internal reforms.
It can be said that at this stage, our biggest contradiction is not external, but internal.
The internal problem has been solved, and the external problem is just a small problem.
3. About the market.
The international situation is developing rapidly.
A few days ago, everyone was still looking forward to a soft landing and interest rate cuts in the United States, but now they are starting to trade a hard landing and interest rate cuts combined with a financial crisis.
I really want to ask about this expectation.
It's the 21st century, it's 2024. Is the United States still the center of the earth?
If Europe and the United States collapse, can China and Russia no longer drive the development of southern countries?
If you in Europe and the United States don't consume or produce, does that mean China, Russia and developing countries can't consume or produce either?
Are you Europeans and Americans human? Are the rest of the world not human? Are you unworthy of a superior life? Are you unworthy of cooking with firewood? Or what?
Is it that the lithography machine cannot be produced, or that the chips cannot be manufactured?
In the past, you were strangling us and we had to rely on your circle. Now that you can no longer strangle us, we can naturally start anew.
We can naturally start a new business and build our own small circle.
And as this circle becomes larger and larger, it will gradually influence the original European and American circles, and even replace them.
Therefore, faced with the current situation of rampant capital flight from all walks of life, we can just watch the show.
Mainly focus on the trend of US stocks.
If any stock investors want to catch a falling knife, consider the CSI 300.
As for the Science and Technology Innovation Board Index Fund, I have never been interested in technology stocks and do not recommend them.
3. About the science and technology innovation sector.
The science and technology innovation sector seems to be performing very well recently.
The biggest background is the logic of technological independence and domestic substitution under the great competition between China and the United States.
However, I have not studied this industry and dare not get involved. There are too many technical routes, and the price-to-earnings ratios of major companies are very high, so the safety margin is difficult to measure.
Of course, it was based on these logics that I bought some smart car shares a few days ago, hoping to reap some benefits from domestic substitution.
Shareholders exchange:
First, "Yang understands slightly": "The United States will then be able to profit enormously from oil, while the Middle East will lose many markets. If China continues to purchase high-priced Saudi oil, it will affect the costs of Chinese manufacturing."
There's nothing wrong with letting the US make some money from oil, and they can even be tricked into turning into a gas station.
The key today is to prevent the United States from completing its re-industrialization.
The key to America's re-industrialization lies in the need for a huge amount of high-quality and low-cost engineering talent, which cannot be met by a large number of immigrants.
There are only two ways to go:
First: Actively reduce national income (self-explosion), develop basic education, cultivate our own high-end talents, and be self-sufficient and self-reliant.
Second: To blow up China, or to bomb Russia again, and to destroy Europe, to harvest the high-end talents in these regions, so that these talents, under the threat of war and the coercion of interests, will voluntarily move to the United States and work for the United States.
And this is the root of America’s true rise in World War II.
Also, in the future, the United States will try to take risks and disrupt our country's fundamental intentions.
Talent is the foundation.
Harvesting talents is the smartest way to harvest.
This is also why the United States pays so much attention to the information industry, media newspapers, and public opinion propaganda.
The reason is brainwashing, disguised control of individuals or even a country, and ultimately reaping their physical and intellectual wealth.
Therefore, we must remain as still as a mountain and use an open strategy to defeat Midea's technological hegemony in a fair and dignified manner.
As for the impact on manufacturing costs, since China, Russia and the Middle East are "allies" to a certain extent at this stage, this can be solved through price concessions, reasonable price increases, etc.
After all, our country is still hovering on the edge of deflation, and inflation is not a big problem.
2. "Shopkeeper Fan who likes Silver Willow": "I bought Nasdaq, but I'm not sure if it will work. I've lost confidence in A-shares now."
I really don't recommend it, absolutely not.
If you buy now, you will join the National Army in 1949, buy a fuel car in 2024, and go south to Hong Kong in 2021 to seize pricing power.
3. "Onii-chan": "Compared to previous years, was this year's investment really that difficult? What exactly made it difficult?"
The difficulty lies in the direction.
If you are just investing in indexes or ETFs, you can buy at this point without hesitation.
But when it comes to stock trading, how can you not be confused about individual stocks?
Take the 2024 interim report as an example. Banks, insurance companies, and real estate companies, the main players in these markets, are all experiencing declining profits, some even plummeting. There is no certainty...
Liquor, consumer goods, and new energy, the star stocks of the past few years, have also seen sluggish performance and no certainty...
The manufacturing sector has performed relatively well due to the anticipation of overseas expansion, but the rise in commodity prices has also eroded profits to a certain extent, and the certainty is not very high...
In the end, the non-ferrous metals sector, which had chosen to avoid suspicion and had certainty and had seen a significant increase in interim performance, was hit by a black swan event, with stocks plummeting for several consecutive days...
The entire market, the last safe haven, seems to have been breached.
At that time, I must have been very confused.
This situation is similar to the sudden outbreak of the new coronavirus in 2020. We didn't know what to invest in and were looking for certain targets. It was exactly the same.
This is one of the reasons why dividend stocks have been so strong recently.
Four: "Big Bulls Travel the World": "Yes, buy the CSI 300 with your eyes closed. In a 10-year cycle, you can always make a little money."
Yes, this point is indeed a good time to buy the CSI 300, and it is also the best target for novices to consider configuration, saving worry and effort.
In the future, it will even steadily outperform the vast majority of stock trading experts.
5. "Xia Houjuan who loves longan bread":
"Stock market bro, there's no need to worry. When Trump came to power, he said he would increase crude oil supply. The problem is that corporate production is tied to interest rates. If companies want to increase investment, interest rates will inevitably be cut. Lowering interest rates will cause the money supply to far exceed people's imagination. When one thing increases, the other decreases. Crude oil prices will soar in both quantity and price. That's why Buffett bet on oil stocks; he sees things more clearly than anyone else. He also sold out of bank stocks. Doesn't this make the logic clear?"
Thanks for clarifying the confusion.
6. "Long Jiao, who likes Kui Zhou Long": "I've noticed something recently: my family and friends' elders have all started complaining about how expensive vegetables are at the market. I remember it was the same thing last time. Daily necessities, vegetables, and meat all saw price increases first, and then other commodities followed suit, and finally, chemicals also saw a surge in prices."
I believe that we are now at a point in time where we are moving from the brink of deflation to inflation.
Keep a close eye on US stocks.
The more the U.S. stock market falls, the more restless the American capitalists become. The more it plummets, the more restless they become.
In the end, just like in 2020, we will be forced to cut interest rates, or even cut them significantly.
By then, our country will really flood the market with money, and the inflation will definitely be very severe.
Seven: "Making a living by holding onto stocks": | "Between Russian and US oil prices, how does China stand or what is its perspective?"
I'm just bragging, just listen to it.
The most favorable oil price for us is neither too high nor too low. If it is too high, it will affect production costs, cause outflows, and give up a lot of profits to upstream companies. If it is too low, it will affect our oil industry and may even bring about deflation.
Now the price is more comfortable.
8. "The Cold and Indifferent Xiang Yunlue": "Why limit yourself to hyperinflation? Now that the risk is here, get out first and wait for clarity before jumping in again. It's good to eat the whole fish, but it's also okay to eat a portion, just pick the part with the fewest bones. I've already taken all my profits in gold, leaving a 40-50% position in the military sector, a little over 10% in new energy vehicles, and about 20% in the two leading semiconductor sectors. I'm waiting for opportunities to develop the rest."
Perhaps, I am a little too greedy.
For many years, I have been fully invested and have not yet cut my losses. This may be because my holdings have not "risen wildly" and perhaps I still have expectations for the future.
In other words, the cost of holding shares is relatively low, and one can afford it and endure it.
Therefore, we always say, don’t chase high prices, chasing high prices will ruin your life. Only when the cost is low enough and the investment is conservative enough can you get better returns.
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