Global Cycles And Major Asset Prices: From Collapse To Restructuring

For China's economy, corporate profit repair and production restoration guided by price fixing became the most powerful support for the performance recovery market in 2016.

But entering 2017, it is necessary to see that continuous price recovery has become a constraint factor for demand restoration; for the micro level, the upstream industry's price rise will impact on the middle and lower reaches; for the macro aggregate demand, under the backdrop of tight external liquidity, the total policy expansion still needs to wait for the opportunity.

If the profits of enterprises become clearer and clearer, it is difficult for policy to form strong support on liquidity.

In the first half of the year, we should pay attention to the logic of defensive and post cyclical inflation. In the second half of this year, there will be structural opportunities for growth stocks, and we should pay attention to undervalued and high dividend blue chips.

Looking forward to 2017, we believe that the full restoration or adjustment of the price system may be the key variable that triggers the high price of the price system.

But judging from the law of economic operation, the price reduction is not achieved overnight, and will be interpreted in the form of "high operation and concussion".

Overall, the annual price center of CPI and PPI in 2017 will be higher than that of 2016, which is obvious to all.

1.2016 years of "resistance" road "twists and turns"

1) cycle operation and asset price operation rhythm in 2016: "ups and downs" under "fatalism and resistance"

In terms of the trajectory of assets, the "fatality and resistance" framework put forward at the end of 2015 was verified: first, in terms of the economic cycle, the mainstream countries' economies interacted with the short cycle in the second half of the year, and second, as for the rhythm of commodities, more varieties experienced the first wave rebound in the first quarter and the two quarter's exhumation, and ushered in second strong rebound in the three quarter and the fourth quarter; third, in the second half of the year, with the short period of economic resonance, the turning point of the national debt yield rate appeared; fourth, in terms of the US dollar index, the first half of the year dropped from 100 to 91 in the second half, and returned steadily to the 100 in the second half of the year. Major categories from 2016

2) policy reconstruction in 2016 - the main line of policy framework formed by G20 and the spread of isolationism.

Globally, the main theme of the 2016 policy framework is to manage the risk of global isolationism, the so-called isolationist risk.

This is mainly due to the marked "de globalization" feature of the new round of mid cycle opened since 2009.

With the economic pformation and global economic integration shrinking, Global trade is in a state of redevelopment.

Since 2009, asset price bubbles have been serious. The problem of widening the gap between the rich and the poor has emerged in the United States and the European Union. It has finally evolved into the political risk of "de globalization". In 2016, it was mainly manifested in the fall of Britain's referendum and Trump's election as president of the United States.

In the whole 2016, the international platform represented by G20 has become an important platform to actively manage the risk of global isolationism.

In the spirit of G20, "avoiding competitive devaluation and overusing monetary policy, promoting positive fiscal policy and structural reform" is precisely the core policy line of the whole world.

However, isolationism is in the process of resisting the risk of isolationism.

Showing its unmanageable character, whether Britain's referendum is over the line or Trump is beyond the mainstream media is expected to eventually be elected, which reflects the spread of "global trend of thought".

In particular, as a leading country in the global economy, if the United States adopts a policy orientation of protectionism, it will pose a challenge to the policy framework based on G20 in 2016.

The risk of 2.2017 years comes from short cycle differentiation, and the US dollar trend is the core of the whole industry.

1) the cycle logic of the US dollar cycle differentiation and the US dollar rising.

At this stage of the 2016-2017 year, as the global economy is still in the middle cycle downward stage, some medium and long term suppression factors will still play a significant role.

Therefore, if we discuss the cycle, we should focus on the trend of the short cycle upward in 2016 and the change pattern since 2017.

For the global economy in 2016, the Sino US stock cycle resonance had a more obvious positive spillover effect on the world.

From the perspective of the exchange rate system, the relatively narrow fluctuation of the US dollar index has caused some pressure on the RMB to release orderly, while China's supply side reform and the price led business profit recovery mode have also led to the emerging market resource countries.

At the same time, the short recovery of the Sino US economic cycle has also led to the revival of other mainstream economies in the world, resulting in the three and fourth quarter global economic recovery of the short period of resonance.

Looking ahead in the first half of 2017, the downward pressure on the cycle comes from the tightening force, and is related to the economic strength of the major economies, and ultimately determines whether the cycle is moving from the three quarter and the fourth quarter of 2016 to a shorter period.

For the short term cycle of the US and China, the short cycle of the US opened in the late two quarter of 2016. According to the law of cycle operation, the approximate rate reached a high point in the two quarter of 2017. For China, the price recovery and short cycle operation will also face the confirmation process in the first quarter of next year; for the European economy,

The fermentation of the problem and its short cycle power are insufficient, and the downward pressure will be greater in the first half of next year.

Therefore, in the first half of next year, we need to be vigilant against the resonance of the short cycle from the re differentiation to the next.

The source of the tightening force that drives downward pressure on the cycle is the uplift of interest rates.

For China, controlling asset price bubbles, especially real estate regulation, will stabilize interest rates. The continued upward trend of commodity prices in 2016 will also restrict the expansion of short cycles. The tightening of external dollar environment is also a constraint factor. For the United States, the long and short term interest rate that will continue to rise will also produce a tightening effect, which will restrict the asset prices of the United States.

With the fall of other mainstream economies, the US short cycle will also lag behind in the two quarter.

On the other hand, the upward trend of the hedging force comes from the economic restructuring policy, mainly the expansion of fiscal policy.

For China, the possible way to hedge is the further expansion of infrastructure investment and the support of the tax policy for the real economy. For the United States, the tax cuts and the expansion of infrastructure investment may also bring support.

But next year, we need to be vigilant against the uncertainty of overseas political and policy implications for the co-ordination of fiscal policies.

Therefore, under the precondition of the periodic operation mode, the operation rule of the US dollar index should be stronger in the first half of the year.

In the short term cycle of the United States, the direction of the US economic policy will also change, and the dollar will weaken again.

2) the danger of the wall: European problem and Trump risk

The continuation of Europe's political risk in 2017 and the uncertainty of Trump's policies make the economic policy hedging cycle more uncertain, which is the core entry point to judge the economy in the first half of 2017.

The European problem in 2017 remained the weakest link in the global economic and financial markets.

After the 2016 referendum off Europe "black swan", isolationist trend of thought spread and difficult to manage has become more and more obvious. The problem of Britain's off Europe will still ferment in 2017; and after the failure of the constitutional amendment in Italy, as the most vulnerable part of European banking risk, the difficulties in promoting reform and solving economic structure problems will increase. The financial risks brought by European banking problems will seriously drag down the fundamentals of southern European countries. For the EU's core country, France will face presidential elections in the first half of 2017, which may make investors more worried.

Therefore, in the process, if the United Kingdom formally starts the process of de Europe and exposes the political problems of the core countries of the EU, the risk of European financial market will further increase.

For Trump, the biggest risk comes from the uncertainty of his policy.

Trump's policies are mainly divided into two categories: how to implement the policy of isolationism and how to change the internal economic policies.

External isolationism is mainly reflected in trade protection and trade friction, and the internal economic policy is mainly reflected in the expansion of tax reduction and infrastructure construction, and on this basis, support for the domestic industry in the United States.

If the US economy is now running to the middle stage of full employment, fiscal policy is a good way to postpone economic recession, but this does not mean that it will bring positive spillover effect to the global economy.

If protectionism is obvious, many policies, including monetary policy, will be dominated by the United States itself. It is hard for us to imagine that other global manufacturing countries should be driven by their own aggregate demand expansion.

Therefore, from the perspective of the danger of Xiao wall, on the whole, for the US and European economies, the uncertainty comes from the short period of recession, and the short period strength and policy orientation of the United States decide that the US dollar index still has support under the differentiation of the US and Europe. For China, real estate and other problems make China stronger in the short term economic intensity than the United States. The tightening of US dollar environment will test the manufacturing countries, while the core manufacturing countries' ability to bear the price of resources is also weaker than that of the United States. For resource countries, the whole country is still supported by the price of resources and will lag behind.

On the whole, Trump's isolationism is a stress test for European countries and manufacturing countries in the first half of next year.

3) 2017 cycle operation and large class asset operation prediction.

On the whole, the core of the 2017 cycle is the possible differentiation between the US, Europe and the US in the first half of 2017.

At present, the approximate rate is the superposition of European political risks and financial risks, making the US dollar index stronger in the first half of the year, and the judgment of the economic fundamentals of China and the United States is due to the comprehensive factors such as demand side constraints caused by real estate factors in China.

Therefore, the price led inventory cycle and the improvement of corporate profits will face external constraints in the first half of the year. The tight price level and interest rate will push China's short cycle down from a high level.

That is to say, the first half of 2017 is the process of seeing the top of the stock market in various countries, and the US will lag behind. The bond market will usher in a trading window in the two quarter after the first quarter's yield is peaked. For commodities, prices will fluctuate in the first half of the year when prices are constrained by demand.

In the second half of 2017, we should pay attention to changes in the logic of global asset operation after the release of risk.

First, focus on the inflexion of the dollar.

After the US dollar index is down, the global risk is released, and asset prices may also be hit by the short cycle of the US.

Against such a background, attention should be paid to the new US economic policies, such as tax cuts and other policies.

Secondly, it is concerned about the impact of China's policy opening on asset prices after the fall in prices and the weakening of the US dollar.

In addition, attention is paid to the risk preference of European financial risks after partial liquidation.

For more information, please pay attention to the world clothing shoes and hats net report.