Inflation is coming to explore the "anti-inflation" password

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Inflation is coming to explore the "anti-inflation" password

China Securities Journal

â–¡ reporter Zhang Lijing

The concept of inflation has long been known as one of the most story-based and confusing investment concepts.

Since last year, global inflation expectations have risen again, led by factors such as commodity price hikes and “Trump trades”. After the release of China's CPI data in January, most of the inflation-related concept stocks in the A-share market closed out on the K line. According to the statistics of China Securities Journal, since January 17, the concept of straight flush pork has increased by 9.5%, significantly exceeding the 5.3% of the Shanghai Composite Index.

More than just stocks, after more than a decade of rapid economic growth, investors’ pursuit of wealth is no longer limited to “save money into banks to pay interest.” As inflation expectations heat up, many people are simultaneously pouring into the property market and infrastructure investment. Products and art markets are more profitable, but the benefits are often accompanied by risks. Investors need to increase their discrimination against inflation itself and related investment products.

Buying gold to buy a building to buy paintings and calligraphy, inflation is coming?

Li Tang, a partner of a private equity firm in Beijing, has invested in gold, real estate trusts, mineral resources stocks, and paintings, jewellery and other works that have recently begun to pay attention to. "I bought a wealth management plan for a piece of art last year and only invested 1 million yuan. The final income is not bad. In the past two years, more and more friends around the world have paid attention to art investment. I plan to buy some more paintings or porcelain this year." Tang said.

With the rise of China's middle class, gold, real estate, stocks, jewelry and other financial methods have gradually replaced bank deposits as the new mainstream of the Chinese "wealth defense war." According to Credit Suisse's standards, China's middle class currently has 109 million people, accounting for 11% of the national adult population, ranking first in the world; its standard for the middle class is adults with a wealth of 50,000 to 500,000 US dollars.

The preservation and appreciation of wealth is an important original intention of investment worldwide. From the public data, from October 2008 to the end of 2016, the central bank's broad money supply M2 increased from 45 trillion yuan to 155 trillion yuan, an increase of nearly 250%.

"From the perspective of the real economy, as long as the negative interest rate exists (the deposit interest rate is lower than the CPI), holding cash or savings is not a smart choice." Warren Buffett said that this time 'cash is rubbish', then the return on investment can outperform CPI's investment targets have the concept of anti-inflation. According to the latest deposit interest rate announced by 42 banks in early 2017, the 1-year deposit interest rate is distributed between 1.5% and 2.25%; while the national consumer price index (CPI) rose by 2.5% in January.

On February 14, the National Bureau of Statistics released data. In January, the national consumer price index (CPI) rose by 2.5% year-on-year, an increase of 0.4 percentage points over the previous month; the industrial producers' price index (PPI) rose by 6.9% year-on-year. The increase was 1.4 percentage points higher than the previous month. The data shows that the CPI year-on-year increase in January of 30 provinces was larger than that in December last year.

Last year, the rise in prices of bulk commodities, especially industrial products, was obvious to all. China Securities Journal reporter found that since the publication of CPI data, the A-share inflation-related concept stocks have strengthened overall. The same flowering aquaculture sector and pork concept stocks rose by 7.8% and 9.4% respectively, higher than the Shanghai and Shenzhen 5% and Shanghai Composite Index. 5.3% increase.

Whenever the CPI increases significantly or people feel the price pressure, the anti-inflation concept related assets are often highly sought after because of fears and fears of the depreciation of wealth. Some speculators took the opportunity to get a lot of profit. The investment is based on the fact that in the inflation process, the value of assets will also expand; the simplest criterion for choosing anti-inflation investment products is that the rate of asset appreciation during the same period is higher than CPI.

Commodities are not only a major indicator of price levels and trends, but also an important target for many investors to invest in inflation expectations. In 2016, the price of bulk commodities rose, and the total transaction value of domestic commodity futures increased by 29.79%, an increase of 4.5 times that of the previous year. From the perspective of returns, in the international market, gold rose by nearly 10% in 2016, silver rose by more than 12%, and Lun Copper rose by 16.9% for the whole year. Crude oil futures oil and oil oil rose more than 43% and 52% respectively. The ore's 62% iron ore index rose nearly 90%. The analysis believes that the push behind this round of growth mainly includes political uncertainty in Europe and the United States, the expectation that Trump will promote infrastructure and the recovery of Chinese demand. According to statistics, the comprehensive return rate of China's property market investment in 2016 is still 5%-8%, while in 2016, the one-year deposit rates of China's major banks are mostly below 2%.

Inflation dispute under the "wind vane"

At the beginning of 2017, inflation expectations started in the second half of last year and once again dominated the global capital market: the US dollar index adjusted at a 14-year high, gold prices continued to rise, commodity prices fluctuated at a high level, and agricultural products continued to rise, and US stocks continued to rise...

The Quqing team of Huachuang Securities believes that the global reinflation expectation is mainly due to the policy proposition after Trump took office, the rise in commodity prices and the rise of global inflation, the signing of OPEC and non-OPEC national frozen production agreements to push up crude oil prices. . The rise in commodity prices will bring imported inflationary pressures to the country, and the depreciation of the renminbi will further increase the pressure on imported inflation. In addition, domestic industrial product prices are still supported, global agricultural product prices are still at a low level, and agricultural supply side reforms may push up domestic agricultural product prices.

In the recent hot debate on "inflation," the financial congress claimed that pork prices are the driving force behind China's previous inflation, while the main cause of overseas inflation is oil prices. Haitong Securities Jiang Chao pointed out that the main cause of inflation in the US, Japan and the Eurozone lies in oil prices. Specifically, the rebound in global oil prices has pushed the traffic and residential categories higher, which is the main reason for the rebound of CPI in the US; the main driver of Japan's CPI recovery is oil prices and food; the rebound in inflation in the Eurozone is mainly reflected in energy-related fuels. And transportation areas.

In the concept of some European and American investment managers, crude oil is the mother of inflation. Crude oil prices have risen sharply since last year, and the expected inflation performance around the world has led them to consider the probability of inflation. On the surface, economic data is in line with previous inflation: in January, the manufacturing PMI of the euro zone rose to the highest in six years, the US ISM manufacturing index hit a new high in November 2014, and Germany's January CPI hit 2013. The highest level since the month. The analysis pointed out that the rise in energy prices is the main driver behind the improvement of these data, and the current rise in crude oil prices is hindered. There are also economists who question the assumption of “global inflation”. Rosenberg pointed out that there is indeed a rebound in inflation in the global market, but the current situation does not mean that three months later, six months later, one This will still be the case even after five years or even five years.

However, for the domestic inflation, Li Xunlei, chief economist of Zhongtai Securities, asked, “Without the price increase of pork, how come inflation?” He pointed out that in the impression, all previous (domestic) inflation was accompanied by pork price hikes. For example, in 2003, 2007 and 2011, even the short-term CPI upside at the beginning of last year. This is not only because pork has a greater weight in the CPI, but it is estimated to account for about 7% after lowering the weight of pork last year, and pork prices are related to food prices (pig-to-food ratio), and pork prices are often accompanied by The rise in food prices. Therefore, all previous inflation is characterized by rising food prices such as pork and food.

The explanation of inflation in economics refers to the continuous and general rise in prices over a period of time caused by the fact that the money supply is greater than the actual demand of the currency, that is, the actual purchasing power is greater than the output supply, resulting in currency depreciation. .

However, Li Xunlei believes that since 2011, M2 has grown by more than 100%, while CPI has achieved only a 17% compound growth. If we look at the perspective further, 30 years ago, the scale of household savings was 300 billion yuan. The academic discussion is more about the problem of “cage tigers”, that is, residents save too much and will happen under hyperinflation The run; in January 2017, the scale reached 60 trillion yuan, and the household savings expanded to 200 times in 30 years. Instead of worrying about hyperinflation as it was in 1987, it was because funds flowed to various asset classes, including real estate, bond markets, stock markets, and even antique collectibles, so the currency that entered the consumer goods sector was few. Part of it.

Open the fog of investment in the concept of "inflation"

For the forecast of inflation in 2017, Shaoyu, chief economist of Orient Securities, pointed out that the year-on-year increase in PPI in January did exceed expectations, mainly because the compression of the supply side led to an increase in the prices of coal, steel and chemical raw materials. However, from the trend of the ring, the PPI growth in January has decreased. This means that the PPI peak probability increases, indicating that the peak of this wave of price increases has passed. The PPI rise will be moderately transmitted to the CPI. After the price of raw materials rises, the end products will have price increases. This year's supply-side reform will be supported by more policies, and the price of agricultural products may rise, which will have a certain impact on the rise of CPI. It is expected that the CPI may exceed 3% in some months, but the annual hub should be between 2.5% and 2.8%.

Just as some new investors do not distinguish between the big buy inflation concept assets, in the investment list, Li Tang has begun to clear the assets related to mineral resources.

His idea is that the spot price of black futures has risen sharply last year, stock prices have also risen, and the profitability of related companies has also improved significantly. This sector has no excess returns. Especially behind mining assets, behind the rise of the midstream, they have become the smallest link in the industry chain.

But this does not mean that the concept of inflation no longer has investment value. Li Tang said: "When people feel the panic about inflation, it is expected to happen in advance. Some assets have been intervened by sensitive funds that are prophetic. Investors should carefully discern when investing, and cannot fall into the blind fog of anti-inflation. ”

What is the inflation concept investment? In the traditional sense, the investment magic weapon of ordinary investors against inflation is nothing more than: real estate, gold, stock concept stocks, and even relatively small futures investments. For example, the price of agricultural products accounts for about one-third of China's CPI index. Therefore, the price of agricultural products has a greater impact on CPI. Conversely, the rise of CPI also indicates the rise of agricultural prices. Other major factors affecting CPI and PPI include food and industrial products. price.

"In the inflationary environment, the spot market price of commodity futures will generally rise, which will increase the profits of listed companies. According to the experience of high CPI in previous years, the most influential are non-ferrous metals, gold, oil, coal, natural gas, potash, and sugar. Liquor and other listed companies in the industry." Li Tang said.

In addition, there are some curves to resist the inflation investment path. For example, once a hedge fund manager saw the price of soybeans rise, and did not directly purchase the relevant agricultural products stocks, but dig deep into the industrial prosperity requirements for irrigation technology, and then tap Go to an over-returned agricultural irrigation technology unit.

Enter [Sina Finance and Economics Unit] Discussion