Ye Tan: The Second Round Of Global Financial Risks Has Swept Through.

The second wave is very close to financial risk. This round of financial risk is made up of three factors, namely, balance sheet degradation, debt crisis, and financial enterprises changing their business priorities.

First, assets

The key is that money is still circulating outside the real economy, which is a partial bubble in asset prices, which reduces the yield of US Treasury bonds and has no other advantages.

Risk spreads, liquidity spreads, market volatility and even time premium are rising in the US financial sector. Banks are reluctant to lend money, and funds have not entered the real economy. The proportion of bank cash in all assets has increased from 3.2% on average to 10%, and the excess reserves of US banks have reached about 1 trillion US dollars.

Some US asset prices rose, and the US stock market began to rise from the economic downturn in 2009. The Dow Jones index broke through a higher position of 12000, but since then, it has been involved in the debt crisis and the real economy, lingering around 12000.

The heaviest pressure was on us real estate, and in June, new housing and housing sales in the US continued to decline.

Sales of new housing have been hovering around 300 thousand units for 14 months, the lowest sales since 1960s. The sales volume of houses has been lingering around 5 million households for 4 years, and sales of very low sales have lasted for quite a long time. No one knows when the bottom is.

According to the US Department of Commerce, the slight fluctuation is not the turning point, but the intermittent noise.

In June, US construction expenditure was seasonally adjusted at an annual rate of about $772 billion 300 million, higher than the revised US $770 billion 500 million in May, but it still dropped by 4.7% compared with $810 billion 400 million in the same period last year.

In the face of rising inflation and financial deleveraging, the choice between the US government and the US Federal Reserve is very limited. That is to maintain a large scale balance sheet so as to prevent the real interest rate from rising and lead to debt continuing to deteriorate. At the same time, we should withdraw from the quantitative easing monetary policy so as to maintain the basic credit of US dollar and US debt.

Second, Europe and the United States all have debts.

The European Central Bank, the most vigilant against inflation, insisted on raising interest rates two times in April and July this year in the frenzy of debt crisis, but still at a negative interest rate. In June, the CPI value of the euro zone rose by 2.7% over the same period last year, with a negative interest rate of 1.2% based on the European benchmark interest rate of 1.5%.

The European Central Bank predicted in June that the euro area's average inflation rate in 2011 will reach 2.6%, and then decrease to 1.7% in 2012.

Lipsky, a member of the European Central Bank's management committee, said in July 26th that the interest rate of the ECB is still very low compared with the level of history.

The US's negative interest rate is basically the same as that of China.

Countries are using the way of tight and dark loose, and the rise in market real interest rates shows that the market does not appreciate loose monetary policy.

The European debt crisis may bring new bad debts to European financial institutions.

Greek bonds are mainly owned by the banks of the country, and European banks generally hold SME loans and bonds issued by the five European banks.

Spanish banks hold more than $2 trillion of these assets, and European financial institutions such as Italian and French can not be left alone if there is a massive default.

The form of China's debt risk is quite distinctive.

The way to make up for debt risk is listing, refinancing and issuing bonds.

With the continuous refinancing of listed banks, the share prices of listed banks are at a historic low.

At the same time, the international investment organization has been selling low priced Chinese bank shares in recent years to reconfigure the assets. With the increase of the risk of default on the urban bond investment, there has been a wave of panic in the city investment bonds. It has always enjoyed the highest credit rating of the railway debt and local debt. In July, the yield of most of the bonds that swept the Chinese bond market hit the highest level in nearly two years, and the yield rose by 100 basis points.

The NDRC had to maintain it.

In July 27th, the NDRC issued a document to the NDRC, major financing platform companies and major brokerages.

The article No. 1765, entitled "notice on Further Strengthening the supervision of the duration of corporate bonds", is considered to be a policy response made by regulators to the "cloud investment incident" which erupted recently, and it is also a concrete move to boost investor confidence in bond markets.

Third, the business of financial enterprises should be changed.

HSBC produced a better than expected semi annual report, but announced the news of massive layoffs.

After cutting down nearly 5000 people in the US, we will cut another 25 thousand people in the next two and a half years.

The changes in HSBC's layout will increase the number of employees in the Asia Pacific region and Brazil.

HSBC has reduced or ended its retail banking business in the US and Eastern Europe. The bank has sold nearly half of the 195 non strategic branches in the United States, mainly distributed in New York, to FirstNiagaraFinancialGroup, which has a total cash of $1 billion, turning North American business to business and wealth management business.

The global financial institutions are making new arrangements, and the base camp of the hedge fund is turning to Asia.

Eurekahedge data show that from 2000 to May this year, the number of Asian hedge funds increased from 202 to 1271.

Over the same period, Asian hedge fund managed assets surged from $19 billion to $134 billion.

The second round of financial risk will not be as massive as 2008, but will continue to test investors' tolerance for financial institutions by cutting costs, refinancing and rising real interest rates.

In the post financial crisis era, global financial risks have not disappeared.