Southeast Asia's financial tsunami, on the verge of breaking out?

A few days ago, a guest in the "No. 16 Internal Reference" asked a good question.

That is, why are stocks still rising in US interest rate hikes and stocks still falling in China's interest rate cuts?

I wrote yesterday that "a rate hike is actually a rate cut, and a rate cut may be a rate hike" to answer this question. I just want to talk to you about some of the contents.

01

The interest rate that everyone usually pays attention to is the interest rate announced by the central banks of various countries, also called the "nominal interest rate", not the "real interest rate". The "real interest rate" can be simply understood as the "nominal interest rate" minus the CPI.

For example, although China is cutting interest rates, the CPI is also declining at the same time, and the decline is faster than the interest rate cut, directly to the negative value, so China seems to be cutting interest rates, but the real interest rate is a rate hike.

The United States is the opposite, because inflation in the United States remains high, the United States says that it is raising interest rates, but the real interest rate is only positive after the continuous rise in the past six months.

Don't look at the "nominal interest rate" in the United States is much higher than in China, but the "real interest rate" in the United States (gray line) is much lower than in China (red line):

Therefore, the rise in the U.S. stock market benefited from the easing of funds, and the pressure on A-shares was due to the pressure on real interest rates at historically high levels.

02

This case fully shows that when we look at some data, if we ignore some factors and only look at the "nominal" and not the "actual", it is easy to draw completely opposite conclusions.

For example, if the unemployment rate of young people in China is high, is there a lack of job opportunities or a lack of good job opportunities? These two logics are completely different, and the solutions are also different.

For example, a brick family recently said that the proportion of migrant workers buying houses in the city is very low, and there is a demand for housing in the future. Does having "demand" mean "effective demand"? "Demand" supported by money is "effective demand," and "demand" without money is not "demand."

For example, in Japan next door, our official account wrote in March "The first interest rate hike in 17 years, the second step of Japan's gambling on national fortunes", mentioning Japan's spring fight, a substantial increase in wages.

But in fact, this salary is also a "nominal wage", but what about the "real wage" in Japan?

According to data released by Japan's Ministry of Health, Labor and Welfare on April 8, Japan's "real wages" fell for 23 consecutive months, as rising wages could not keep up with rising prices.

Considering the depreciation of the yen, Japan's extreme dependence on resource imports, and imported inflation have led to even more negative growth in "real wages".

03

One more sentence here, many people only look at the exchange rate between the RMB and the US dollar, and think that the RMB is not good. But in fact, in recent years, during the domestic super-cycle switching period, under very difficult circumstances, the RMB against the US dollar is still basically below 7.3.

But if you look at the exchange rate between the renminbi and the yen, the yen has depreciated by nearly 30% against the renminbi in the past three years.

In other words, many people say that buying a house in Japan has gone up a lot, but if you consider this exchange rate factor, it doesn't go up, but it still falls.

Recently, not only Japan, but also South Korea, many Southeast Asian countries, because of the postponement of the US dollar interest rate cut, the exchange rate has accelerated the depreciation trend, and the strong dollar is sucking away the liquidity of these countries.

USD/Philippine Peso (since 1993):

USD/KRW (since 1982):

USD/THB (since 1982):

The following two, the exchange rate is even more brutal, which happens to be the countries that are counting on replacing China's exports in the past few years:

USD/VND (since 1996):

USD/INR (since 1975):

USDJPY (since 1972):

At present, the probability of accelerated depreciation of the yen is not small, and it has now depreciated to the level of 1990, so it is difficult to go to 170.

So we have written an article before to remind that some of the views of buying Nikkei with closed eyes on the Internet should still be cautious, since the end of March, the Nikkei 225 has retraced 8%, and then consider the exchange rate loss, if it rushes into it in March, the actual loss has exceeded 10%.

If the dollar does not cut interest rates this year, the yen's exchange rate in the second half of the year may not be able to withstand it. Many countries in Southeast Asia are not sure to set off fireworks.

04

The key is that the United States is also quite embarrassed at this juncture.

The Fed's balance sheet, before the epidemic, was 3 trillion and hundreds of billions, and in the first half of 22 years, it directly reached 9 trillion, and the balance sheet has shrunk to today, and there are still 7.5 trillion yuan;

the balance of the national debt, 23 trillion before the epidemic, 35 trillion now;

The federal interest expense has been around 400 billion for the past 20 years, 5-600 billion before the epidemic, and the interest for the whole year this year has gone to a small 2 trillion.

This means that if we want to protect the treasury and US bonds, we must cut interest rates as soon as possible, and if we want to protect the credit of the dollar, we must raise interest rates as soon as possible.

At this moment, the pressure on the Fed is huge. Coupled with the influence of Russia, Ukraine, Palestine and Israel, there is a high probability that some small and medium-sized countries will have to pay for it.

That's why Europe and China have been looking at each other recently, and they have to consider a way out. Especially in the context of the relatively high probability of Trump coming to power at the end of the year.

Moreover, China's political, military, and economic independence may be completely eliminated in this crisis.

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This year is likely to be another macro year, and it is also a macro year with extremely high judgment and transaction difficulty, and there are too many uncertainties.

Therefore, family investment and financial management are stable and everything is pressed.

——This article was first published on the official account of Grenade Inquiry, follow us and discover more financial truths——