Markets Weekly April 27, 2024

Hello my friends, today is April 27th and this is Markets Weekly. So this week was another volatile weekend markets, but we did end the week up nicely. It looks like that 100 day moving average provided some good support for the S&P 500 and now we're right below the 20 and 50 day moving average which I'm sure many bears would like to sell at. So I think that the short term trajectory of markets is going to be heavily dependent on the big events next week. We got the Fed, we got the quarterly refunding announcement and we got non-farm payrolls. As you all know, I continue to be positive on the equity markets. So today I want to talk about three things.

大家好，今天是4月27日，这里是每周市场简报。本周市场再次波动很大，但最终我们以不错的涨幅收尾。看起来，S&P 500的100日移动平均线为市场提供了一些支撑，现在我们正好处在20日和50日移动平均线下方，我相信许多空头会想在这里开始卖出。因此我认为，市场的短期走势将在很大程度上取决于下周的重大事件。我们有美联储会议、季度退款公告和非农就业数据公布。大家都知道，我依然对股票市场持乐观态度。今天我想谈谈三件事情。

First, we have to talk about the big data prints we got the past week that seem to suggest that inflation is going to be sticky around 3% that is, as we've been discussing for months, this inflation was transitory. Secondly, so it looks like the US government is poised to seize Russian reserves and give them to Ukraine. Now I think this is a very big development in the history of the monetary system and it's going to have big impacts that will be felt for years and also have big impacts on asset prices. Let's talk about what some of those impacts could be.

首先，让我们来谈谈上周获取的大数据印记，这似乎表明通货膨胀将维持在3%左右，也就是说，正如我们几个月来一直讨论的那样，这种通货膨胀只是暂时的。其次，美国政府似乎准备扣押俄罗斯的储备金并转交给乌克兰。现在我认为这是货币体系史上一个非常重大的发展，将对未来多年产生重大影响，也会对资产价格产生重大影响。让我们来谈谈可能产生的一些影响。

And lastly, last week the Fed published its most recent semi-annual monetary financial stability report and in it is full of lots of interesting data on valuations and credit quality as the Fed staff sees it. So let's take a look inside to see what it's saying.

最后，上周美联储发布了最新的半年度货币金融稳定报告，其中包含许多有趣的数据，涉及估值和信贷质量，这是美联储工作人员对此的看法。让我们来看看其中的内容，看看它在说些什么。

Starting with the big data prints. So the past week we got the first estimate of first quarter GDP and on the surface it doesn't look good. So GDP growth printed at 1.6% which was not just far below expectations but also below trend. Secondly, inflation printed above expectations and looks like it's going to be comfortably above 3%. So all in it looks like growth slowing inflation accelerating smells a little bit like stag flation. But I think below the surface it looks a little bit better.

从大数据印刷开始。所以上周我们得到了第一季度GDP的初步估计，表面上看起来不乐观。因此，GDP增长率为1.6%，远低于预期，也低于趋势。其次，通胀率高于预期，看起来将轻松超过3%。总的来说，看起来增长放缓，通胀加速，有点像滞涨。但我觉得在底层看起来稍微好一点。

First let's talk about GDP. So GDP obviously 1.6% of big disappointment. But the people who really study this say that this GDP print is actually stronger when you look below the surface because GDP is comprised of many different components. Some of them are quite volatile. Kind of like CPI you have headline CPI that includes things like energy that goes up and down and you also have core CPI that excludes these volatile components. When it comes to GDP data these volatile components are things like net exports and inventories. So when you exclude the stuff that's more volatile looking at the core measures let's say private final consumption it looks a lot better and frankly it is decelerating but it's still historically quite strong. And so a lot of the people who focus on this don't actually think that this was a weak GDP print.

首先让我们来谈谈国内生产总值（GDP）。因此，GDP显然增长1.6%是令人大失所望的。但真正研究这方面的人认为，在深入挖掘之后，这个GDP数据实际上更加强劲，因为GDP由许多不同的组成部分构成。其中一些相当波动。有点像消费者物价指数（CPI），你有包含能源等波动的物价指数和排除这些波动成分的核心物价指数。就GDP数据而言，这些波动成分例如净出口和库存。因此，当排除更加波动的因素，看核心指标，比如私人最终消费，它看起来要好得多，而且实际上虽然有减速，但历史上仍然相当强劲。因此，许多关注这方面的人实际上并不认为这是一个弱势的GDP数据。

In fact you can even make the argument that demand is quite strong in the US so much so that it's spilling over and leading to more imports and maybe the stronger dollar plays a role as well. So again it may be the GDP print is not as weak as it appears to be but the inflation print though is very clearly disappointing. So just to level set a little bit for the second half of the 2023 core PCE printed at bang on 2.0% and now it looks like it's comfortably above 3% at least for the first quarter of this year. Now this is really eliciting a very strong market reaction because if you think that you know GDP continues to be strong under the surface but inflation looks to be accelerating then obviously it's going to have big impacts on monetary policy. The Fed just can't cut as much as it wanted to.

事实上，甚至可以这样说，美国的需求非常强劲，以至于溢出并导致更多的进口，也可能是强劲的美元发挥了作用。因此，可能GDP数据并不像表面看起来那么疲软，但通胀数据确实非常令人失望。因此，在2023年下半年，核心PCE数据已经稳定在2.0%，现在看起来至少在今年第一季度已经明显超过3%。这引发了市场的强烈反应，因为如果你认为GDP在表面下继续保持强劲，但通胀看起来正在加速，显然将对货币政策产生重大影响。美联储无法像希望的那样大幅削减利率。

So the reaction to this news is yields going higher, market pricing out, Fed cuts and of course equities selling off. Right now it looks like the market is pricing in just maybe one and a half a bit less than one and a half cuts this week and I think that makes sense. The Fed's projections for this year was the end of the year at about 2.6% core PCE and three cuts. If core PC looks to be above 3% this year and right now that's the trajectory you definitely can't have three cuts you can have two you can have one and something like that so I think the market is bang on for that. But note though this is a very volatile series and we could have different inflation prints, we could have weaker employment prints and there is some indication looking at say PMI data looking at way throughout that the labor market is softening we can have weak labor prints and that would completely change the calculus.

因此，对这一消息的反应是收益率上涨，市场定价出局，美联储减息，当然还有股票出售。目前看来，市场正在定价，可能本周会降息一次半，甚至不到一个半的次数，我认为这是合理的。美联储对今年的预测是年底核心PCE约为2.6%，并且有三次降息。如果今年核心PCE看起来会超过3%，而且现在看来确实如此，那肯定不能有三次降息，最多只能有两次，或者一次之类的，所以我觉得市场对此是非常准确的。但需要注意的是，这是一个非常波动的系列数据，我们可能会看到不同的通胀数据，可能会看到较弱的就业数据，looking at say PMI data looking at way throughout 工厂采购经理指数数据 经济呈现软化迹象，我们可能会看到劳动就业数据疲软，这将完全改变计算方式。

Right now it looks like we're going to get a more hawkish fin than before. Jip Howes pivot when he was at that conference in DC chatting with Governor Tiff Maklim of Bank of Canada was prescient and maybe he knew it. Now, so I think the Fed meeting this coming week is probably not going to be too surprising the market is already pricing in a lot of hawkishness. Okay, the second thing that I want to talk about is that the House recently passed a resolution that will allow the US to take the Russian reserves that it seized and give them to Ukraine. Now this is expected to easily sail through the Senate and be signed by President Biden so it's going to happen. Now at the end of the day this is only a few billion dollars most of Russians farm reserves are in the Eurozone. In Eurozone there's discussion that they want to do the same thing but there's I think a little bit more uncertainty. Now I think this is a really big deal because it's telling the world that your money in dollars just isn't safe. If we don't like what you do not only are we going to freeze it you know when you freeze someone's assets if there's still hope that maybe later on a new government comes and then you can release the assets or maybe you choose your modify your behavior and the assets get unfreezed but they're taking assets from one country and giving it to another.

目前看起来，我们可能会看到比以前更鹰派的美联储。吉普·豪斯在华盛顿与加拿大央行行长蒂夫·麦克林交谈时的转变是很有远见的，也许他当时就知道了。所以我认为，即将召开的美联储会议可能不会给市场带来太大意外，市场已经在预期很多鹰派政策。另外，我想谈谈的第二件事是，国会最近通过了一项决议，允许美国拿走俄罗斯扣押的储备金，并把它们交给乌克兰。预计这将很容易通过参议院并由拜登总统签署，所以这将会发生。最终，涉及的金额只有几十亿美元，大部分俄罗斯的外汇储备在欧元区。欧元区也有讨论要做同样的事情，但我认为有一些不确定性。我认为这是一个非常重大的事件，因为它向世界传递的信息是，你在美元中的资产并不安全。如果我们不喜欢你的行为，我们不仅会冻结你的资产，而且还会将资产从一个国家拿走并交给另一个国家。

Now I think this is kind of this is really going to have a big impact in how sovereigns like other countries especially those that are not close friends with the US think about holding their financial exposure. Now today the US is the world's global reserve currency everyone holds a bunch of treasuries a bunch of dollars but that didn't happen magically it was the effort of a lot of diplomacy and you know a lot of good management which is not the case today. Now there's a recent paper called the Treasury standard that I'll link to that details some of the efforts that went into in making the dollar the global reserve currency. The US government you know basically went around the world saying hey hey we're projecting you we're doing good things can you buy some treasuries and that was very successful we had a lot of countries let's say in the Middle East throughout the developing world you know feel comfortable buying treasuries and through the decades just became routine in buying that but now you're giving people a reason not to buy not to hold dollars not to have treasury exposure at the time when you're running a you know five six percent fiscal deficit for the foreseeable future that is to say when you really want other people to hold your dollars.

现在我认为这种情况真的会对主权国家，特别是那些与美国不是亲密朋友的国家，思考如何持有他们的财务风险会产生重大影响。今天美国是世界的全球储备货币，每个人都持有大量的国债和美元，但这并不是神奇发生的，而是许多外交努力和良好管理的结果，而这一切今天已经不存在。最近有一篇名为《国债标准》的论文，详细描述了使美元成为全球储备货币的一些努力。美国政府基本上走遍全球，告诉别人“嘿，我们很可靠，我们在做好事，你可以买些国债”，这非常成功，许多国家，比如中东以及发展中国家，感到舒服地买入了国债，通过几十年的努力，这成为了一个常规行为。但现在你给人们一个理由不去购买美元，不持有美元，不持有国债风险，而此时你的财政赤字预计将在可预见的未来维持在百分之五六左右，这意味着你真的希望其他人持有你的美元时，这是个问题。

Now you know we hear a lot of news of let's say oh the US is building a new chip factory in Arizona and Texas or wherever we have Taiwan semiconductor is coming in and building factories there's a big push to build a lot of chip factories in the US. Why well naturally part of it is due to the geopolitics we want to we know that we are really reliant upon this and this resource this resource is you know close to China far away from our sphere of influence and there's some conflict over Taiwan. So it's part of a geopolitical play. Now keeping this in mind you have to think about this from let's say China's perspective right so the US is trying to diversify from China through what it's reliant upon manufacturing you know French or anything like that and China is going to be doing the same thing. It has tremendous amounts of dollar exposure now we don't exactly know just how many treasuries it holds it's a foreign reserves about three and a half trillion and we don't the exact compensation is a state secret but you know generally estimated to be you know at least a trillion dollars and that's a lot of exposure that you know just as the US diversifies manufacturing away from China China is going to have to diversify some financial exposure away from the dollar. There's not a lot of places to put that money but you know we know that they've been trying to put it in other places.

现在你知道，我们听到了很多新闻，比如美国正在亚利桑那州和德克萨斯州等地建设新的芯片工厂，而台湾半导体公司也计划在那里建设工厂，美国正在大力推动在美国建设许多芯片工厂。为什么呢？自然而然的一部分原因是由于地缘政治，我们知道我们对此非常依赖，这个资源离中国很近，距离我们的影响范围很远，而且关于台湾存在一些冲突。所以这是地缘政治方面的一部分。现在考虑到这一点，你必须从中国的角度来思考，美国正试图通过减少对中国的依赖来实现多样化，对于制造业或其他方面的依赖，而中国也将采取同样的做法。它拥有大量美元资产，我们不确切知道它持有多少美国国债，外汇储备约为三万五千亿美元，确切的持有数是国家机密，但一般估计至少是一万亿美元，这是很大的风险，就像美国将制造业从中国多样化一样，中国也将不得不将一些金融资产多样化，远离美元。这里有很少的地方可以放置这笔钱，但我们知道他们一直在尝试将其放置在其他地方。

For example there was that say belt and road initiative trying to lend dollars to a lot of developing countries so basically your dollar asset goes from an asset that goes from an IOU given from the US government to an IOU given by another government which doesn't have as much credit risk. So it seems like one implication of this big diversification of foreign reserves is going to be a bid for non dollar assets like gold. So if you look at some of the data it looks like a lot of the surge in gold prices is due to increased activity trading in China and you even have some data that suggests that maybe there are a lot of people in China stockpiling things like copper. So if you have a trillion dollars of exposure and you want to diversify that a little bit one there's not a lot of things you can do but when you do it you have to do this slowly and you're going to make prices rise. Now looking at the gold market you know it's big but it's not that big it's not that liquid and you really can't hold that much money. So when we see the steady bid in gold prices even as the dollar strengthens even as real interest rates rise I'm getting the sense that you know you really do have some sovereign interest there trying to diversify the tremendous holdings and they happen to do it slowly and gradually because the market in gold is just not that deep compared to say treasuries.

例如，有一种所谓的“一带一路”倡议，试图向许多发展中国家提供美元贷款，基本上你的美元资产从美国政府发出的债券变成了另一个政府发出的债券，这个政府的信用风险没有那么大。因此，这种对外汇储备的大规模分散化似乎会导致对非美元资产如黄金的需求增加。所以，如果你看一些数据，金价飙升的很大部分原因是由于中国的交易活动增加，甚至有一些数据表明可能有很多中国人在囤积铜之类的物品。因此，如果你有一万亿美元的资产暴露度，并且希望稍微多元化一下，你可以做的事情并不多，但当你这样做时，你必须缓慢进行，这将导致价格上涨。现在看看黄金市场，你会发现它很大，但并不那么大，也不那么流动，你实际上无法持有那么多资金。因此，即使在美元走强，实际利率上升的情况下，我们仍然看到金价稳步上涨，我觉得确实有一些主权国家利益在尝试分散巨额资产，并且他们选择缓慢逐渐地这样做，因为与美国国债相比，金市场的深度并不那么大。

So I'm feeling pretty positive about gold prices right now that it can really go higher than anyone expects simply because you have these real geopolitical interests at play. Now on the flip side though we could see structural weakness in charging market going forward simply because we are widely advertising to a lot of foreign investors, foreign sovereign investors who you know is a big pool of money that dollars are not reliable because if you do something we don't like we're going to weaponize against you. So I think this is you know again plays into a theme of maybe higher interest rates not just due to structurally stick your inflation but that you are going to have to have more of a risk premium in dollars that you didn't have before which is a real shame because having a reserve currency is a huge privilege and part of the reason why the US is just kind of spent without without any afterthought but that looks like it's structurally changing. It's not going to happen overnight but you know you're going to have higher commodity prices I think and you're going to have higher interest rates going forward over the years.

所以我对黄金价格感觉非常乐观，认为它可能会比任何人预期的都要更高，因为现在有这些真正的地缘政治利益在起作用。然而，另一方面，我们可能会看到未来充电市场出现结构性弱点，只是因为我们广泛宣传给很多外国投资者，外国主权投资者，他们知道美元并不可靠，因为如果你做了我们不喜欢的事情，我们会将其当作武器对付你。所以我认为这又涉及到一个主题，可能不仅仅由于结构性的通货膨胀而导致利率上升，而且你将不得不对美元的风险溢价更加重视，这是一种真正的遗憾，因为拥有储备货币是一种巨大的特权，也是美国无所顾忌地花费的原因之一，但看起来这种情况正在结构性地发生变化。这不会一夜之间发生，但是你将来可能会看到更高的商品价格和更高的利率。

Okay the last thing that I want to talk about is that the Fed's latest semi annual financial stability report. Now this is a really good report because it the Fed has really good data and it's able to organize that data and present a coherent picture as to what's happening in the financial markets. Now first let's look about look at how the Fed staff is looking at valuations. Now when you look at valuations you have a textbook approach that is either a fundamental view let's say you know price earnings stuff like that or you can value it from a relative perspective let's say equities versus bonds something called the equity risk premium. Now looking at the Fed staff's work they're saying that you know valuations are stretched which is kind of no surprise anyone but also note that you know looking at these charts what is expensive can continue to become even more expensive and what is cheap can continue to become even cheaper.

好的，我想要谈谈的最后一件事是美联储最新的半年度金融稳定报告。这真的是一个很好的报告，因为美联储拥有非常好的数据，并且能够整理这些数据并展示一个关于金融市场发生了什么的连贯图片。现在首先让我们看看美联储工作人员对估值的看法。当你看估值时，你可以采用教科书方法，即一个基本观点，比如价格收益比之类的，或者你可以从相对角度来评估，比如股票与债券之间的关系，一些称为股票风险溢价的东西。看看美联储工作人员的工作，他们说估值被拉伸了，这对任何人来说都不是什么意外，但也要注意，看着这些图表，昂贵的东西可以继续变得更昂贵，便宜的东西可以继续变得更便宜。

So personally I don't find valuation measures to be very useful in looking at markets but in line with say perceived expensive equity markets we can also look at the corporate bond market and it also looks pretty rich as well. So the way that people usually look at corporate bond markets is what are corporate bond yields as a spread the treasuries. The wider that spread is the more premium lender is wanting to receive when it's lending to the private sector. Now corporate bond spreads are historically quite narrow so you got narrow corporate bond spreads high-tech evaluations it tells a picture that you know financial conditions are not super restrictive how which is what we all know. Now I also want to take a look at what the Fed staff is thinking about when it comes to housing. So one valuation metric of housing is to basically look at house prices with reference to rents you know kind of like a cap rate approach of looking at it and based on this measure the recalculation suggests that home prices are historically quite high which is in line what many people are thinking as well.

就我个人而言，我不觉得估值指标在研究市场方面非常有用，但是与被认为昂贵的股票市场相一致，我们也可以看看公司债券市场，它看起来也相当丰厚。通常人们查看公司债券市场的方式是查看公司债券收益率与国债的利差。利差越大，贷款人在向私人部门借贷时想要获得的溢价就越多。现在公司债券利差在历史上是相当狭窄的，所以当你看到狭窄的公司债券利差和高度估值时，它描绘了一个金融环境并没有像我们所知道的那样非常严格的情形。现在我也想看看联邦储备工作人员在考虑房地产时是如何想的。房地产的一个估值指标基本上是查看房价与租金的关联，你知道这有点像一个资本化率的方法来看待它，并根据这一指标，重新计算表明房价在历史上非常高，这与许多人的想法一致。

Now moving forward let's look at some of the measures of credit quality. So there's been a lot of discussion how the US consumer is just not doing that well. So here we provide first let's look at auto loans. So looking at auto loans we see auto loan balances really surge post pandemic as interest rates were high or low and now that they're high we can see them really plateauing but more notably though we do see that auto loan delinquencies have climbed and they are higher than they were in the pre-pandemic era. So there is definitely some segment of the consumer who are having some trouble making their payments.

现在让我们来看看信用质量的一些指标。有很多讨论美国消费者的表现并不好。首先让我们来看看汽车贷款情况。观察汽车贷款情况，我们发现在疫情后汽车贷款余额大幅上涨，因为利率高或低，现在它们在高位出现平稳，但更值得注意的是，我们看到汽车贷款逾期情况上升，高于疫情前的水平。因此，肯定有一部分消费者在支付方面遇到了困难。

Now looking at credit card debt we can see that credit card debt of course rose a lot but credit card delinquencies are also climbing they were at very low levels post pandemic but now they are really comfortably above the pre-pandemic trend. So there are definitely some people who are having some trouble making their payments.

现在看信用卡债务，我们可以看到信用卡债务当然上升了很多，但信用卡逾期付款也在上升，它们在疫情之后一直保持在很低的水平，但现在它们确实远远高于疫情前的趋势。因此，显然有些人在偿还款项方面遇到了一些困难。

Now part of the reason for these rising consumer delinquencies though is as we've discussed before not so much of loosening credit standards but an inflation in credit scores. Credit scores basically are pro cyclical. So when the economy is doing well you know everyone has jobs everyone makes their payments or when you know the government is sending you free checks you know you have plenty of capacity to make your payments and so your credit score goes up. Now this has led to some inflation in credit scores such that you know someone who is actually a bad credit looks like a less bad credit and so in a sense you can think of it as basically people who shouldn't be getting loans are getting loans and I think that's contributing to the higher delinquency rates.

现在，导致消费者拖欠款项上升的部分原因是，正如我们之前讨论过的那样，并不是因为信贷标准放宽了，而是信用评分通胀了。信用评分基本上是顺周期的。所以，当经济状况良好时，大家都有工作，每个人都能按时付款，或者政府发放免费支票时，你有足够的能力支付款项，因此你的信用评分会上升。现在，这导致了信用评分的通货膨胀，因此一个实际上信用不好的人看起来像是信用较差的人，所以从某种意义上说，你可以认为实际上不应该获得贷款的人正在获得贷款，我认为这也是导致较高拖欠率的原因之一。

So definitely something to focus on.

这绝对是值得关注的重点。

So this week is a Fed meeting week and so again I'll be back on March, I'm sorry Wednesday Wednesday to give you my FOMC debrief. But anyway that's all prepared for this week. Thanks so much for tuning in. If you're interested in my thoughts take a look at my weekly blog FedGuy.com. This week I will be writing about the implications of the policy implications of what we're hearing that President Trump wants to play a bigger role in setting monetary policy and maybe he wants to devalue the dollar as well.

所以这个星期是美联储会议周，我会在三月的星期三回来和大家讨论FOMC会议的情况。不过这个星期我已经准备好了。非常感谢大家的收听。如果你对我的想法感兴趣，请查看我的每周博客FedGuy.com。本周我将写关于总统特朗普想要在货币政策中扮演更重要角色以及可能想让美元贬值的政策影响。

Let's think about how that could happen and what that implies. And of course if you're interested in learning more about financial markets check out my online courses at centralbanking101.com. Thanks so much and I'll talk to you guys soon.

让我们思考一下这种可能发生的方式以及所暗示的意义。当然，如果你对了解更多关于金融市场感兴趣的话，请查看我在centralbanking101.com上的在线课程。非常感谢，我很快会和大家交谈。