Lu Ming is also paying attention to the affairs of Lao Yang and others, but that's all. He has more important work at the moment.
In the office of the chairman of Tiansheng Capital Headquarters, Qi Wei is sitting here, sitting on a single sofa in the rest area. Lu Ming is standing next to the floor-to-ceiling window in the office, with his left hand in his pocket and his right hand holding a cup of hot tea, facing the window. Street view of the new financial center in Xiangningzhou City.
Qi Wei looked at Lu Ming and said: "The offshore exchange rate is going to break 7, is it going to depreciate so much? When?"
Currently, the offshore RMB exchange rate is 6.8827 yuan per U.S. dollar.
Lu Ming's words were concise and concise: "At the beginning of next month, around 2,000 basis points, both onshore and offshore will break the 7 figure."
Qi Wei couldn't help but be slightly surprised when he heard this. The depreciation was quite strong, and many people were concerned about the psychological barrier of 7.
You know, in the foreign exchange war in 2016, the integer digit of 7 was not broken. In the most difficult stage of the trade war last year, 7 was still not broken, so this is a very important psychological threshold.
"I participated in the internal informal economic video conference held by the superiors the day before yesterday and Saturday. I basically don't have high expectations for this negotiation." Lu Ming came to the sofa in the rest area and sat down.
Qiwei couldn't help but say: "In other words, it is impossible to negotiate a 10% tariff on US$300 billion of goods?"
"I don't know, but I guess we can't reach an agreement. This time we made a serious cut, and the other party has been trying to find ways to make amends." Lu Ming put the tea cup on one side and crossed his legs and said, "The bosses are starting to prepare in advance."
This is the reaction of the President of the Republic of China to increase taxes on 300 billion US dollars of products.
Depreciation has both pros and cons.
Advantages: Expanding exports, hedging the impact of additional tariffs; increasing bargaining chips; reducing the impact of the Federal Reserve's interest rate cuts on the country. The United States started the first round of interest rate cuts in June, but the country has not yet taken the initiative to use the tool of interest rate cuts. Before that, take the initiative to depreciate the RMB, leaving a certain amount of flexibility for subsequent strategy formulation, etc.
Disadvantages: It may trigger capital flight, of course, some capital cannot escape because of being "trapped"; it is not conducive to imports; it is not conducive to the stock market. If there are expectations of further depreciation, foreign investment inflows will be more cautious, and domestic capital will be more conservative; it will cause accidental injuries. The exchange rates are linked to the exchange rates of other countries. While devaluing the US dollar, it will also cause the depreciation of other countries' currencies, which is not conducive to the economic and trade balance of other countries.
However, after comprehensive consideration and weighing the pros and cons, the final decision was to actively devalue.
Another big reason is that Lu Ming also expressed a clear view on the expectation that North America will continue to cut interest rates in the video conference. There was no ambiguity, but very certainty. Simply put, the Fed's 25 basis points cut in June was not enough. It will definitely be done later. Interest rates will be cut further, and the global economic recession will become more obvious.
In general, large short-term fluctuations in exchange rates, whether substantial appreciation or depreciation, are not good.
But there is nothing you can do, choose the lesser of two evils.
Since the foreign exchange war that year, Tiansheng Capital has held a large amount of offshore RMB chips. It held a meeting on the weekend last weekend and the superiors have made a decision to cooperate to bring down the foreign exchange market.
In this way, the foreign exchange price can be lowered before the upper management uses corresponding financial tools, leaving a certain amount of space.
"In addition, regarding the layout of the external market, especially the U.S. stock market, the overall long thinking this year remains unchanged, but a short-term short-selling strategy should be adopted." Lu Ming looked at Qi Wei and explained.
"Is the chairman worried about the risk of U.S. bond yields inverting?" Qiwei couldn't help but said. The current situation of U.S. bond yields has attracted much attention from the market. The 10-year U.S. bond and the 2-year U.S. bond fell for the first time since October 2007. upside down.
Traders often pay special attention to the spread between the 10-year and 2-year Treasury yields because they have preceded every recession in the past fifty years. Although an economic recession often takes months or even years to arrive, it is also regarded by the market as a reliable indicator of economic recession.
U.S. bond yields tend to fall significantly when market sentiment rises sharply, so they are often used by the market as a "barometer" to observe risk aversion. The so-called yield inversion is actually not difficult to understand.
Guhua
Under normal circumstances, the long-term yield should be higher than the short-term yield, that is, the 10-year Treasury bond yield is higher than the 2-year yield. If the yield is inverted, the 2-year yield will be higher.
In other words, the return two years ago is higher than the return ten years ago.
This reflects the lack of optimism about the future economy. More importantly, this phenomenon occurs before every economic recession. It is surprisingly accurate, and the market often responds in advance.
Lu Ming sighed and said: "This year has been a troubled year, and the global market has been violently turbulent. However, a market that amplifies speculative volatility can actually amplify our returns."
This is true, but conversely, if the market fluctuates violently, the volatility will increase, and if the speculative operations and corresponding strategic tools are done wrong, the loss rate will also increase.
This year is really not easy, and it is difficult all over the world.
The growth rate of domestic economy and industry is declining; the financial market of Agence has directly collapsed; the German economy is experiencing negative growth; the EU's economic growth is declining; the Brazilian economy is declining; and the trade war on a global scale, the commander-in-chief is not just fighting a trade war with rabbits; The decline in oil yields of major investors indicates a significant reduction in oil demand; the negative issues of Britain's no-deal Brexit and many other things.
These things resonate with each other and promote the increase in global economic risks, which further leads to the increase in expectations of a global economic recession. The inversion of U.S. bond yields is just around the corner.
The risk aversion of investors in the United States is gradually increasing. At that time, they will abandon securities such as stock futures and purchase a large amount of relatively safe government bonds. The rush to buy 10-year U.S. bonds has caused a surge in prices, resulting in a sharp drop in yields, which is about to drop. to below the 2-year U.S. Treasury yield.
"This inversion thing... be prepared for the Federal Reserve to cut interest rates for the second or even third time." Lu Ming said. Once the U.S. bond yields invert, the Federal Reserve will usually use two methods to adjust.
One is to shrink the balance sheet, which can increase long-term bond yields through the Fed's selling of ten-year Treasury bonds, thus lifting the inversion.
The other is to cut interest rates, which can immediately lift the inversion, because an interest rate cut will directly drive short-term bond yields to plummet.
After explaining the matter, Lu Ming asked by the way: "By the way, how is the distribution of virtual currency chips?"
Upon hearing this, Qi Wei immediately nodded and replied: "The shipment target was completed two days ago. As of now, the total market value of the global virtual currency market is 278.3 billion U.S. dollars. The overall increase yesterday was +4.72%, and the 24-hour trading volume was 60.6 billion U.S. dollars."
Qi Wei added: "The performance of mainstream currencies, BTC is temporarily reported at US$10,083, an increase of +3.82%; ETH is temporarily reported at US$222.31, an increase of +7.90%; LTC is temporarily reported at US$94.3, an increase of +6.02
%, ETC was temporarily quoted at US$6.14, an increase of 4.91%; EOS was temporarily quoted at US$4.58, an increase of +11.73%; among the top 100 currencies by market capitalization, the top three increasers were EDR, WTC and EGT, which increased by +43.65% respectively.
25.77% and +23.48%.”
So much data came out yesterday. Qi Wei actually remembered it so clearly. Lu Ming couldn't help but admire him a little. The other party reported it without reading the materials. There was something there.
There are so many varieties of virtual currencies that it’s dazzling. Even Lu Ming can’t figure out how many currencies there are on the market now. In short, the virtual currency market is in chaos.
Tiansheng QDIE began shipping and distributing chips in early July. At that time, the total market value of global virtual currencies was 365.2 billion U.S. dollars. The shipment volume was the largest on the first day. At that time, the total 24-hour trading volume of all currencies reached 138.6 billion U.S. dollars.
, releasing trading volume that was more than double that of the previous day.
At that time, the quoted price of Bitcoin was US$12,774, and the total market value of Bitcoin was US$268 billion. The total market value of this currency accounted for more than 70% of the total market value of the global virtual currency market.
Today, Tiansheng QDIE has completed its shipment target, and the total market value of the global virtual currency market has shrunk to US$278 billion, the total market value of Bitcoin is about US$210 billion, and the total 24-hour trading volume of all currencies has also dropped.
Already.
Tiansheng QDIE is not satisfied with taking long positions. It shorted Bitcoin when it was around 12,000 US dollars. It is not afraid of being squeezed short because Tiansheng QDIE is smashing it with another hand. The amount of funds is too strong and few people dare to short squeeze.
If you say that Bitcoin is decentralized, it is really nonsense. When Tiansheng QDIE held the most chips, it was definitely the new center of Bitcoin, at least one of the centers, which was Dazhuang and Qiangzhuang!
Even in the second wave since last year, it still has a huge influence on the price fluctuations of Bitcoin. Decentralization? This is not true at least for Lu Ming.
