市场 (Market) 对生意而言,市场(market)的动向,是他们最关心的事项之一.市况不利,则屯积货物；等到市况好转,就可获得极大利益. 现在世界通信网络密布,即使是海外的市况也可轻易取得,商业界可据此考虑是否要进行交易.虽然如此,但也不是人人都能了解所有商品的情况.有些市场的动向,非属于其范围的专业人士则不能掌握.这些市场情况如果能用语言来表达,在贸易往来上,就非常方便. 用语言来表示市况,是商业人士必备的条件.若要灵活利用市况信息,首先必须通过特定市况的大量沟通方式,或者贸易通讯,才能进一步恰如其分地表达,利用市场情况.Basic Expressions（基本例句）贵方的市场报告对本公司非常有帮助.Your market report is very informative to us.市场大幅波动,本公司希望静观其变.As the market fluctuations are considerable, we would like to watch the situation.目前市场走向趋于复苏,本公司建议贵公司及早购买.As the tone of market tends toward recovery, we advise you to make an early purchase.市场一片狂热,请密注意其进展.As the maret is excited, please keep your eyes on the development of the market.目前市场行情上涨.It is a bull market now.目前的市场特色是卖方操纵市场.The present feature of market is shown in the manipulation by sellers.此地的市场受人为因素压迫而上扬.The market here is being forced up.Words and Expressions（词汇和短语）stock market 股票市场market report 市场报告market fluctuations 市场波动tone of the market 市场走向development of the market 市场进展bear market; weak market 行情下跌bull market; strong market 行情上涨feature of market 市场特色force up the market 人为因素压迫市况上场
市场危机（Markets in Crisis）
概要 - 是资本的边际效率相对于利率的突然崩溃，而不仅仅是利率上升导致市场危机。中国资本的边际效率必须进一步提高，才能使每年名义GDP的增量能够维持其宏观形式上的利率负担。中国去杠杆和加强金融监管使市场利率水平和波动普遍上扬。然而，尽管供给侧改革取得了成功，但资本效率改善的速度却落后于利率水平的飙升。
Summary - It is the collapse of marginal capital efficiency versus interest rate, rather than rising interest rate alone that tends to trigger a market crisis. China’s marginal capital efficiency must improve further, before its incremental nominal GDP can sustain its pro-forma interest rate burden annually. The deleveraging campaign and tightening regulation have triggered a general increase in market interest rates and interest volatility. But the improvement in capital efficiency is falling behind, despite the successful supply-side reform.
In the US, 10-year yield has surged above its long-term declining channel, to a level that portended market crises in the past. Prior to the global sell-off, the combination of low volatility, high valuation and tightening global central banks is the worst recipe for the market. Suppressed volatility, through either vol-shorting trades or through market stabilizing schemes, is like a botched face job – it looks good only on the outside.
Despite the significant market sell-off, market sentiment stays elevated, suggesting selling pressure can be far from concluding. As price plunges, it can affect the current perception of strong economic fundamentals. Through reflexivity, price itself is the quintessential economic fundamental. As inflation pressure mounts in the near term, and interest rates are still at historical lows, central banks’ hands are tied, even if the sell-off spirals into crisis. For now, we would resist the temptation of catching a rebound through short-term technical weakness. And the market may have seen its high for the first half of 2018.
After the Republic of Korea announced it had agreed to the United Statesdeployingthe Terminal High-Altitude Area Defense anti-missile system in its territory, which will break theregional strategic balance, reports show some ROK TV programs have encountered obstacles trying to enter the Chinese market.
We thank you for your support all these years. In particular, we thank you for voting us as the Best Strategist and the Best Economist, in total 12 top-three awards, in the 2017 "Asia Money" Institutional Survey. We wish you and your family a Prosperous New Year!
这是今天报告的英文原版《Markets in Crisis》，感谢阅读。中文翻译版将稍后发出。视频是2018年2月6日盘前与CNBC对市场看法的专访。请点击本文最下方的“阅读原文”观看完整视频。
Furthermore, share prices of major ROK entertainment companies that do business with Chinaplungedon Friday,amidincreasing market worries about the potential impact of Seoul’s decision to deploy an advanced missile defense system.
“But I suggest that a more typical, and often the predominant, explanation of the crisis is, not primarily a rise in the rate of interest, but a sudden collapse in the marginal efficiency of capital.
S.M. Entertainment Co fell by 3.1 percent, while JYP Entertainment Corp dropped by 3.42 percent on the ROK’s KOSDAQ stock exchange. CJ Corp was down 5.41 percent at the close.
The later stages of the boom are characterized by optimistic expectations as to the future yield of capital-goods sufficiently strong to offset their growing abundance and their rising costs of production and, probably, a rise in the rate of interest also.
It is of the nature of organized investment markets, under the influence of purchasers largely ignorant of what they are buying and of speculators who are more concerned with forecasting the next shift of market sentiment than with a reasonable estimate of the future yield of capital-assets, that, when disillusion falls upon an over-optimistic and overbought market, it should fall with sudden and even catastrophic force.**
Moreover, the dismay and uncertainty as to the future which accompanies a collapse in the marginal efficiency of capital naturally precipitates a sharp increase in liquidity-preference – and hence a rise in the rate of interest.”
Chinese video-streaming provider Youku Tudou Inc sent anotice on Sina Weibo on Thursday, saying a fan meeting for the dramaUncontrollably Fond, with the scheduled attendance of two ROK stars in Beijing on Saturday, was to be postponed due to "force majeure".
–General Theory of Employment, Interest and Money, John Maynard Keynes
Markets in Crisis
But Youku denied concerns that the ROK’s agreement to deploy the Terminal High Altitude Area Defense system would limit development prospects for ROK stars and entertainment businesses.
Market sentiment remains elevated despite a significant sell-off. As we write, global markets continue their epic sell-off. Despite the plunge, market sentiment remains elevated. Of course, as the global markets roil, our market sentiment index will continue to shift towards a more neutral stance. But with market sentiment at its elevated level currently, the selling pressure does not appear to be concluding any time soon (Exhibit 1). As such, we would not attempt to catch falling knives, or be lured into technical rebounds that tend to follow any significant correction, before the dusts settle.
In our most recent report titled “The Year of the Dog: Lessons from 2017”, just three trading days before this plunge, we warned of an impending correction. We suggest that we need to wait for the near-term market excess to dissipate, before re-establishing our market positions. Our sentiment indicator, albeit not infallible, has an excellent track record. For instance, it pinpointed the market peak in October 2007 when the Shanghai Composite was above 6000 points, and again in June 2015 when the Composite was above 5000 points - two of the biggest stock market bubbles in recent history.
During market crisis, the correlation between markets quickly approaches one. As such, our sentiment indicator is a snapshot of global market conditions, especially at inflection points.
The ROK’s media have reported that Chinese authorities will likely move to curb ROK stars’ activities and programs in China.
Exhibit 1: Market sentiment has declined from extreme, but remains elevated.
The State Administration of Press, Publication, Radio, Film and Television has not commented on the market speculation.
Surging interest rates due to China’s deleverage campaign portends market risks.In our 2018 outlook report titled “View from the Peak” on 4 December 2017, we discussed how China’s deleveraging campaign had triggered a general rise in market interest rates in the domestic Chinese bond market. Indeed, the sell-off of bonds in November and December at times has been epic. And for the first time in history, the CDB one-year yield surged above the one-year benchmark lending rate.
Such occurrences tended to herald market crises in the past, as we wrote in our 2018 outlook report (Exhibit 2). In the same 2018 outlook report “View from the Peak”, we foresaw an investment style change sometime during the first quarter, and posited that the market would look very different before and after the first quarter.
Chen Shaofeng, deputy head at the Institute for Cultural Industries of Peking University, said the planned THAAD deployment will have an adverse effect on the ROK’s culture and entertainment industry. "As much as 70 percent of South Korea’s cultural industry is for the foreign market, of which China accounts for nearly 50 percent."
Exhibit 2: Surging Chinese bond yields above benchmark lending rate portended market crisis in the past.
Chen added that the ROK entertainment companies that are heavily involved in China will be the hardest hit, and that Chinese companies investing in the ROK will also suffer losses.
Surging long yield in the US also portends market risks. We believe that this latent development has been largely overlooked by pundits. Of course, the surging US ten-year yield is an easy candidate to blame. After all, it has pierced its long-term downward channel. And every time it happened, somewhere in the world there was a market crisis (Exhibit 3). And this time there is no exception. Surging interest rates in both the US and China seem to hint at a more systemic risk at play.
Exhibit 3: Whenever US 10yr yield pierced its long-term downward channel historically, a market crisis broke out.
- depolyv. (technical术语) to move soldiers or weapons into a position where they are ready for military action部署，调度（军队或武器）
China’s pro-forma annual interest burden can potentially outweigh its incremental nominal GDP; capital efficiency could be declining. The average interest rate on China’s financing is estimated to be ~7%. At an M2 of RMB 168 trillion, China’s pro-forma interest burden should be around RMB 12 trillion. This is compared with RMB 8-9 trillion incremental nominal GDP added annually, calculated at 10% nominal growth on RMB 82 trillion GDP in 2017. That is, China’s annual pro-forma interest burden can be higher than its nominal GDP growth, due to the significant debt burden. Please note that these are very rough estimates.
E.g At least 5 000 missiles were deployed along the border.（沿边境至少部署了5000枚导弹。）
As such, China’s marginal capital efficiency, although may be improving due to the success of supply-side reform and SOE reform, must be rising slower than its interest rate burden. Meanwhile, credit per unit of GDP has surged, suggesting that capital efficiency could be outright declining. Our rough estimates have demonstrated the urgency of the deleveraging campaign.
- plungev. (of prices, temperatures, etc.价格、温度等) to decrease suddenly and quickly暴跌；骤降；突降
As Keynes posits in his magnum opus “General Theory”, it is because of marginal capital efficiency rising significantly slower than interest rate that will trigger a market crisis. This is either because marginal capital efficiency is collapsing, or interest rate is rising too fast, or both,. Not just because of rising interest rates. At the current juncture, with the global market correction unravelling, the Hang Seng’s return is still at a similar level that coincided with market peaks in the past. Keynes’s words some eighty years ago appear ever so prescient (Exhibit 4).
E.g Stock markets plunged at the news of the coup.（政变的消息一传来，股票市场便暴跌。）
Exhibit 4: Overseas retail sentiment remains elevated; HSI return is at similar levels prior to previous market corrections
- amidprep. in the middle of or during sth,especially sth that causes excitement or fear在…过程中；在…中
E.g He finished his speech amid tremendous applause.（他在雷鸣般的掌声中结束了演讲。）
Hao Hong, CFA
- force majeure (from French, law法律) unexpected circumstances, such as war, that can be used as an excuse when they prevent sb from doing sth that is written in a contract不可抗力（如战争，常指未能履行合约的原因）
E.g The scope of force majeure may be specified in the contract.（不可抗力事件的范围,可以在合同中约定。）
Fan Feifei “ROK Entertainment Shares Drop on THAAD Worries”China Daily2016-08-08
“Missile System 'Hits' TV Shows”China Daily2016-08-05
（All Pictures Are Chosen from the Internet.）