Credit expansion and rising inflation expectations is the main reason the stock market

 Credit expansion and inflation expectations is the main reason the stock market rebound

2009-2-24 Daily News seems to confirm a word, China's stock market is not only a barometer of the real economy, or the reverse index, contraction of the good time credit, poor economy, when easy credit.
2009 years, most notably the massive expansion of credit,UGG bailey button, and the Ministry of Finance submitted to the National People's Congress of the budget report, the deficit reached a record 950 billion yuan, the scale to 9 times in 2008, innovation and the largest amount since the founding of China. two shares of capital attack, stunning the capital market.
in the local capital market under the impact of excess liquidity lost direction. Now the Chinese stock market is not lack of liquidity , but excess liquidity; active fiscal policy to rescue the real economy, first in the elite to save the stock market listed company, using the new concept of energy speculators,UGG boots clearance, speculation, and rely on brokerage commissions to eat the Chinese stock market bubble mm2007 when , investment income accounted for about one quarter of China's corporate profits, return of the bull market ahead of brokerage commission income, and speculation of new energy concept in January rose to about 70% of total large Ushimata Jin Jing technology, millions of shares in block trades occur, the high shareholder cash. According to China Securities Depository and Clearing Corporation Limited, said personal trading account last week, adding approximately 426,000, representing a significant increase in the level recently.
credit expansion in the stock market ratio? no one knows. But excess capacity and business the case of balance sheet repair, credit expansion is the result of banks and other companies conspired to transfer funds to carry channels to make quick money during the 1929 recession expansionary U.S. fiscal policy reason for the resistance encountered most of the Fed, that is, lack of motivation because the credit companies. taking into account the structural imbalance of the existence of credit, demand exceeds supply (less bank credit and more government programs) are unique, no two ways about credit arbitrage funds.
fiscal deficits fuel, and other Governments efforts to reduce deficit is different from our country is to bring the economy out of decline in fiscal deficit in the quagmire.
deficit is not necessarily inflationary, they will bring inflation expectations. gotta live debt repayment,cheap UGG boots, the U.S. dollar with strong U.S. dollar hegemony holders of credit to the world There were to borrow money, but there is no such way to our country, the so-called Panda in the international bond issuance of RMB is still a trial period, it is impossible to solve major problems. Therefore, the main way in the domestic debt, issue bonds to the public and market institutions. The repayment method nothing more than to return to business cycle the economy, with the conservation of sources to solve the budget deficit over; like the United States held refinance old debt, however, implied by this approach depends on the bond's credit, if credit poor, can only be assessed by borrowing money; most contemptible way is to use the government issued a large number of additional monetary claims, the result of doing so is cut out Peter to pay Paul.
fiscal 2008 revenue of 6 trillion,UGG boots, 950 billion in fiscal deficit accounted for GDP3.1%, seem to not bring in big trouble, but taking into account the reduction in government revenue in 2009 increased expenditure of local government taking into account the huge debt the Treasury is still thoroughly, and the number is not considered too serious will commit a big mistake. In time of economic contraction, inflation expectations have increased, the proliferation of local liquidity has begun to show.
credit expansion and inflation expectations under the fiscal deficit, the recent exception of the increase in the stock market uncharacteristically. banks and Government reveal all the details for the stock market to maintain confidence in the results is the transfer of risk to the future. contrarian indicator can not be sustained, the current short-term rise in the future to pay a heavy price for.
2009 年 2 23, the People's Bank of China issued sing the stock market in the central bank hopes to resolve the financial pressure to make direct financing is not the normal situation in the bank, The paradox is that, no bank credit expansion, there is no short-term stock market is booming abnormal.
at stake in the situation, thank God Fortunately, stock index futures and other derivatives not yet introduced, foreign investment can only be between different industries in proportion to hedge positions, or through the fictitious overseas A-share index, trading in the territory of a large blue chips to make a profit. Otherwise, seen through the Chinese capital market pricing of virtual high foam, short of financial derivatives in China by blue chips and the RMB exchange rate, China's economy will become weak. such as Bank of England, Soros will be hell, and now eyeing on the disastrous Euro, which has vowed to secure excessive prices the authority of the department, and ultimately punished by the market.
inevitable economic cycle is the process of dredging the market, but also restructuring opportunities. Faced with the current situation, keep a clear head, avoid banks significant increase in bad debt rate under the credit improvement carried away to avoid deficit financing as a real threat of inflation is critical.
Note: crazy in the working state of the manuscript in a hurry, and other things.
friends around red rush ahead to kill the stock market, and today a friend and will get killed.
I still wait and see. to see the situation change, to calm the market, should not earn money, to earn the money, no hurry.