Long term investors should suspend trading in the Hongkong market, Sina Financial opinion leaders (WeChat public number kopleader) columnist Hong Hao Hongkong market sentiment has soared to historic extremes. The market sentiment is extremely optimistic, accompanied by fluctuations in the long position is not a good situation of low market record. Market callback asymptotic. Long term investors should suspend trading, waiting for the market to adjust the opportunity to better configure the market in Hongkong. Long term investors should suspend the volatility of short-term financing costs in Hongkong market has disappeared, stock volatility, exchange rate and vice versa in bonds: since the June 2015 China stock market bubble burst, Chinese short-term funding costs have been maintained at a slightly higher than the 2% narrow range interval. Stable short-term financing costs encourage traders to use short-term financing and leverage to buy long debt. These highly concentrated, leveraged bond positions have pushed China’s 10 year government bond yields down to historic lows at the end of 2008 (see chart 1). This is a crowded trade. The problem lies in that any short-term funding costs or bond price fluctuations are likely to cause a stampede — similar to the exchange rate reform in August 2015 after unilateral RMB appreciation is expected to change rapidly, which triggered a large-scale open renminbi arbitrage. At present, China’s 10 year bond yields failed to stand firm or effectively break through its historical lows. Changes in the Fed’s interest rate expectations could lead to a surge in short-term financing costs, or a drop in bond prices, both of which are not conducive to a crowded, highly leveraged transaction. The European Central Bank did not expand quantitative easing policy, Rosengren Rosengren from dove change eagle will be about short-term interest rate expectations. And Brainard Renard will speak on Monday. If interest rates are artificially maintained, then the RMB will face devaluation pressure. In other words, if the volatility are not reflected in the bond market, it may use the renminbi. Focus chart 1: the volatility of short-term financing costs disappear. China’s 10 year bond yields can not hold a historic low, and has begun to rebound. Inflation, prices and rising commodity prices and the history of the narrow money supply are closely related, but the bond yields significant differences: Historically, by PPI to calculate the pressure of inflation, real estate and commodity prices, money supply M1 narrow money supply and bond yields are closely related (focus chart 2). Although the statistical correlation is not causation, reasons for this correlation is very compact and intuitive: the money supply should be changed to significantly expand the prospect of growth and inflation, resulting in real estate and commodity prices, and is reflected in the decline in bond prices in. However, the historical relevance of bond yields to other variables has been different in the current cycle. In other words, bond prices fail to reflect rising inflationary pressures triggered by significant monetary policy expansion, and at the same time lead to upward pressure on commodity and real estate prices. The expectations of each asset class are so divided, as described above相关的主题文章: