Politburo Watching All 5 Major Financial Markets

iFeng: 史无前例!政治局会议同提五大市场(附解读)
To promote the healthy development of credit, stock market, bond market, foreign exchange market and property market”, today's Xinhua News Agency suddenly broke through the news and announced the important contents of the 423 Central Political Bureau meeting. This sentence has become the most central expression! The meeting also mentioned the names of the five markets of credit, stock market, bond market, foreign exchange market and property market, which has never been done before.
There is only one way to make all of these markets healthy: major free market reforms. Otherwise, one or more of these markets is being manipulated to keep the others healthy, as is the case with property, credit and foreign exchange at the moment.
The Politburo meeting held today, compared with the meeting on February 24, has changed its expression. The added content is mainly in four aspects:

First, continue to expand domestic demand

The second is to strengthen the key core technologies and actively support the development of new industries, new models, and new formats.

The third is to reduce corporate financing, energy use and logistics costs

The fourth is to promote the healthy development of credit, stock market, bond market, foreign exchange market and property market

Looking back at the February 24 meeting, we emphasized these aspects:

First, to achieve the objectives of economic and social development this year, it is necessary to maintain the stability of macroeconomic policies and implement a proactive fiscal policy and a prudent monetary policy.

The second is to further promote supply-side structural reforms, speed up the building of an innovation nation, deepen reforms in basic and key areas, and resolutely fight for the three major challenges.

Third, implement the strategy of rejuvenating the countryside, promote a coordinated development strategy for the region, expand consumption and promote effective investment, promote the formation of a new pattern of comprehensive openness, improve protection and improve people’s livelihood.

The fourth is to comprehensively strengthen the government's own construction, adhere to administration in accordance with the constitution, administration according to law, improve government effectiveness, and better serve the people.
Guan Qingyou mentioned that there are many signals worth attention:

First, there is no worry about the economic downturn caused by squeezing liquidity and squeezing bubbles.

Second, the monetary and fiscal tone does not seem to change, but it actually leaves an opening for easing.

Third, we continue to dilute the aggregate indicators, and we must look at structural indicators in the future.

Fourth, the changes in the top-level leadership mechanisms will become clearer and their execution will increase significantly.

Fifth, stressing the opening of the Boao Forum for Asia and Hainan is a strong signal of reform and opening up.

Sixth, high-quality development requires new “anchors”. The comprehensive statistics of the central bank’s financial industry is just the beginning. These anchors are estimated to be launched one after another.

Seventh, 2018 will become the core technology dividend year. The trade war between China and the United States is not terrible. The terrible one is the financial and technological warfare. The ZTE incident has sounded a warning to China and the Central Government has taken it seriously. In the core components, core infrastructure, especially the network infrastructure is subject to people, is China's largest weakness. Recently, the central government has held consecutive meetings and there will certainly be a large number of supporting funds and policies. However, we must also realize that these technologies are not the same as nuclear weapons, they have objective laws, they require time and accumulation, and the question of whether the nationwide system can work is a question mark. However, we have no other choice.

Eighth, the central government is not only concerned with banks and the property market. Now more than ever, it must pay attention to capital market risks. Specifically referring to "promoting the healthy development of credit, stock market, bond market, foreign exchange market, and property market," the names of the five markets have been set. This has never happened before. Credit is a traditional banking risk, and the property market is a traditional real estate risk. Adding the stock market, bond market, and foreign exchange market is an important change in recent years. This is mainly because these markets have exposed major risks. The money shortage in 2013 and the debt crisis in 2016, the stock market disaster in 2015, and the evacuation of foreign exchange reserves after the 811 (August 11, 2015) fell 1 trillion yuan, what are the market risks in such a system? Layers must not be missed.

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