Who is lying in the stock market or the bond market?
It's rare to see that Bao Lao Ge is actually covered in hawk skin, which shows that inflation is really serious.
It's true. Inflation in the service sector will not fall unless there is a major recession. However, oil prices have begun to rise, and commodity inflation will rise again. The year-over-year inflation data is probably not too bad; after all, last year's base was very large. But if compared to 2019, inflation in 2023 is bound to be frighteningly high.
I think the current problem with inflation in the service sector is that two undercover agents, Chuan Jianguo and Bai Zhenhua, worked together to destroy the great achievements of the American Empire. The two comrades did a really good job, ruining the efforts of Clinton, George W. Bush, Obama and other reactionaries over the years. There is nothing the Federal Reserve can do about the current US problem. The Federal Reserve has only one choice: either condone inflation or create a recession. If you are also afraid of inflation and fear of recession, then the likely outcome is Murphy's Law. Everything you are afraid of will come, and the economy will stagnate. Currently, the US is only one black swan away from stagflation. So, Bao Laoge, go ahead and choose one of the two. Don't be presumptuous. If you want to control inflation, raise interest rates by 50, and stop raising interest rates if you want to protect the economy. I'm afraid the 25 interest rate hike and the slurry approach will go wrong![]()
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Today, due to Bao Eagle's speech, the inversion of the 2-year and 10-year treasury bond yields deepened. After watching it just now, it was actually 100 basis points inverted! This is also an exaggeration; it shows that the market is betting more and more on the recession. Short-term bonds have high interest rates, betting on interest rate hikes. Long-term bonds have low interest rates and are betting on interest rate cuts. If there is no recession, why should interest rates be cut? The more severe the recession, the bigger the rate cut. An interest rate spread of 100 basis points is a bet on what kind of major recession?
However, the stock market is not so pessimistic, which is very strange. The rate hike was a blow to bonds, but it was at least a triple blow to the stock market.
1. As risk-free interest rates rise, capital will be cautious about venture capital. Retail investors are the boldest, and big capitalists are the least bold. If I had 100 billion dollars, lying directly in the Federal Reserve account and receiving 500 million dollars in interest every year, wouldn't that be good? Why should I risk losing my principal to invest in stocks? The withdrawal of money from the stock market was the first blow.
2. Difficulties in financing are fatal to enterprises. How many stocks are there, and the companies behind them can survive without financing? As interest rates rise and capital's risk appetite decreases, financing becomes difficult. This is second level.
3. High inflation and high interest rates have also dealt a huge blow to non-essential goods. Interest rates are currently high, and inflation is not falling. Mortgages are rising, rents are rising, food is rising, gasoline is rising, medicine is rising, utility bills are rising, and interest on credit cards is ridiculously high. The share of necessities of life in personal disposable income will rise sharply, and expenses for non-essential items will inevitably be reduced. As long as cars, mobile phones, computers, home appliances, and clothes aren't damaged, keep working together.
It is strange that the stock market can maintain a high position in the face of multiple downsides. But retail investors can only follow the trend. Who is lying about the stock market or bonds, I don't know; let's watch as we walk. I'm still betting: for the sake of ease of calculation, currently TLT is 100 yuan, and spy is 400 yuan. Let's compare the value in 2024.
Currently, I'm still looking at the band. I think it will still be between 3930-4070, with high margin and low absorption, with take profit and stop loss. Unless Bao Laoge raises interest rates by 50, or the CPI explodes, etc., I don't expect a sharp decline in the short term. But I estimate that the CPI explosion will have to wait at least until next month; after all, the data is lagging behind.
Risky stocks:
$Tesla(TSLA.US$ $NVIDIA(NVDA.US$ $ARK Innovation ETF(ARKK.US$ , and all kinds of junk stocks. To clarify, junk stocks don't mean company trash. You can refer to the definition of junk bonds. It's not that those bond issuers are all garbage![]()
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The opportunities outweigh the risks: It's not easy to say right now; it's best to wait until it pulls back to around 3950. I'm optimistic about recession-resistant, undervalued stocks. Currently, the industrial sector is relatively strong; I bought a little $3M(MMM.US$ , and $Industrial Select Sector SPDR Fund(XLI.US$ . There's also $Costco(COST.US$ , I love this company. Furthermore, I think anti-epidemic stocks are generally undervalued, including $BioNTech(BNTX.US$ und $Pfizer(PFE.US$ , and $Moderna(MRNA.US$ . The coronavirus has kept such a low profile recently, and it is probably holding back big moves.
But there are some recession-resistant stocks, for example, $McDonald's(MCD.US$ It's currently too expensive; as long as it falls, it's worth buying.
I took the TLT at the bottom of 100 $iShares 20+ Year Treasury Bond ETF(TLT.US$ The position was reduced in the past two days, a small profit of 2% was locked in, and 10% of the base position was retained.
YCS has been good recently. Come on, Japan, continue to depreciate the yen, don't let us down. $ProShares UltraShort Yen(YCS.US$
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本人散户，闲钱投资，名字为系统生成。这里记录投资感悟与趣事。所有言论都纯属娱乐，不是投资建议。此账号为本人唯一社媒平台。
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FF-Rise : The previous analysis was good; the latter part of the stock operation is questionable
高贵的阿德莱德 OP FF-Rise : You're right, no one is sure about this kind of market environment. I'm also searching, so I'm just sharing; it's not stock selection advice, nor investment advice. Whether it's profit or compensation, I'll share it all. It's just an entertainment program. Everyone is having fun hehe![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
QianmengYu : Inflation is, on the one hand, insufficient supply; on the other hand, Biden and the Big Blue State are spending money indiscriminately, and are spending money by borrowing heavily (driving up M1, M2). The Fed's interest rate hike suppresses demand and explodes some high leverage, which in itself is correct. However, supply (aka powerhouse) and expenditure (Biden) do not collaborate. The stock market is strong, and REIT isn't very bad, but everyone knows that there is bound to be reflections. How about raising interest rates and adding to heaven and then federation default? Many people in the Biden team have already begun to limit benefits, strictly investigating those who are not in agreement with conditions to receive benefits. The problem is that Biden is licking money owners, and the ideology of the young left-left team is paramount. The defense budget and aid to Ukraine are 200B, interest expenses plus 600B, and will soon rise to 1T. Tax increases will result in Trump 2024. Choose your own
高贵的阿德莱德 OP QianmengYu : It is possible that the US will actually get away with it this time, so some people are betting that the US will experience a major recession once in 100 years![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")