Original link: https://tumutanzi.com/archives/16919
The narrative may be meticulous, but the conclusion should be seen far and wide.
– Huang Renyu
Nothing happened yesterday. I checked the annual growth rate of CPI in the United States so far this year. The data is 8.6%, which can be understood as the inflation rate. What does this data show?
Looking at the historical data, in the past 110 years in the United States, there have been 11 times higher than this data. Except for the oil crisis in the 1970s, there were 5 times, and the other 6 times were before and after the two world wars… Such a high CPI Annual growth rates are not auspicious signs.
At present, the Federal Reserve has raised the US dollar interest rate several times this year, and it has only been less than 2.33%. In the early 1980s, the interest rate was as high as 20%. It can be expected that the United States will continue to raise interest rates fiercely, until inflation is brought down, or its own economic recession is unbearable, and it has to stop raising interest rates.
The US dollar raises interest rates and the US dollar funds strengthen, and it is difficult to say good about the market conditions of other bulk assets. So, after each rate hike, global stock markets responded with a corresponding drop.
In the past three years, the U.S. stock market has given people a bullish phenomenon, which corresponds to the low interest rates in the United States after the epidemic. The money printing machine was turned on, and the world released water. With the dollar weakening, the prices of bulk assets rose. An illusion that does not match the actual economic level.
It was true that we did not notice the impact of currency interest rates on asset prices before, but now we find that the currency interest rate hike in the first economy can have such a large impact, and it works on the scale of a larger cycle.
Stay tuned for more news on this in the future.
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