Will The "Deleveraging" Affect The Stock Market Again?

The wave of Vanke's equity dispute has finally attracted the attention of regulators.

In December 29th, the China Insurance Regulatory Commission held the "Risk Management Conference on insurance asset and liability management", which displayed a yellow card for "more aggressive insurance companies".

According to reports, Xiang Junbo, chairman of the China Insurance Regulatory Commission, said at the meeting that the insurance industry should guard against systemic fluctuations in the stock market and face the shock of the stock market, so that the insurance company should seize the opportunity.

Chen Wenhui, vice chairman of the Insurance Regulatory Commission responsible for investment, pointed out at the meeting that insurance asset liability management is facing risks and problems such as increased volatility in capital market.

Some of the more aggressive insurance companies are facing the test of insufficient solvency. Some of the listed companies are facing concentration and liquidity risks.

Chen Wenhui also said that a few controlling shareholders or internal controllers used insurance companies to locate financing platforms, use trust schemes and other ways as channels to finance related enterprises, and carry out illegitimate interests pmission, which highlights the lack of investment management capability.

The current market has been highly controlled by the main force, and closely matched by policies and funds, controlling the index above palm stocks.

If managers draw lessons from past experience, there will be corresponding hedging policies.

At least until March 1st, the market must be stable and deliver for the arrival of registration.

But some of the stocks are down because of this deleveraging. It seems hard to avoid.

The common points of the listed companies include undervalued blue chips, dispersed ownership, stable capital return and dividends, and good cash flow.

In my previous column, why did insurance companies crazily buy houses? Because they were afraid! In this article, I analyzed two major motives for insurance companies to raise money in blue chips: first, they were worried about inflation, and two were worried about the depreciation of the renminbi.

Since reform and opening up, China's monetary policy has been in fact lax.

In the early years, the broad money M2 growth rate (that is, the "money printing speed") was generally maintained at over 20%, and the individual year reached an alarming 40% (1993).

In recent 10 years, M2 growth has dropped from around 17% to around 13%, and only in 2009 surged to 27.7%.

The excessive growth of money will inevitably cause asset prices to rise.

For example, over the past 10 years, housing prices in big cities are pushed by money.

In fact, the stock price also has this effect, for example, a listed company with reasonable valuation, if the operating level and profit margin remain unchanged, prices will rise 3 times in 10 years.

It will increase by 3 times.

At that time, the company's share price went up 3 times more reasonable.

In fact, this is the fundamental reason why Ren has to predict that the Shanghai Composite Index will rise to 10 thousand. Professor Dong Fan predicted that Beijing's housing price must be 800 thousand yuan per square meter based on this consideration.

Insurance funds crazy to raise blue chips, is to avoid severe.

Risks.

But the question is whether there is a "short debt and long investment" in its capital, and the degree of leverage to what extent it can withstand the test of market volatility has become a big problem.

Moreover, this aggressive investment is actually gambling on China.

It must be excessive, and the future will still be high inflation in fact, and there will be no deflation.

But we know that China has suffered at least two rounds of deflation in the past 35 years.

In the long run, let's not talk about it for the time being.

Now the China Insurance Regulatory Commission has issued a stern warning, and the upsurge of insurance fund raising blue chips is expected to cool down.

In January 8, 2016, when the stock market lasted for half a year, when the stock market crashed, the securities and Futures Commission demanded that the major shareholders of listed companies and Dong Jiangao ban the reduction in six months. The insurance funds were ordered to "not act rashly". Then did the stock market collapse due to the "leverage of insurance funds"?