Why Do Trillions Deal With Siege?

Last week's single day super trillion paction is more a good thing. It marks that the Shanghai and Shenzhen stock market has finally moved towards the blue chip era, and the big era of China's capital market has opened the curtain.

The CSRC did not conduct window guidance on the huge volume of pactions, indicating that our management saw more positive aspects, but did not take it for granted like some so-called experts.

The adjustment of financial stocks is short term, and larger blue chips will have a larger midline market.

Last week, the gunpowder was finally closed with a long shadow.

The focus of the debate is whether the huge volume of pactions in Shanghai and Shenzhen stock markets is good or bad, whether it affects the financial security of the country, and whether to go back to the speculation of the concept of the subject. The former is about the macro level of national security, while the latter is related to the pocketbook of thousands of investors and is not a trivial matter.

I haven't written the stock market reviews for nearly a month, because as early as September this year, I issued the "bull market, officially started in October".

Since then, the bull market has crossed 2450 points on the bull and bear line on a timely basis, giving a lively lesson to those bear market theorists with great momentum.

I think everything is conclusive, and no need for my commentator to look at the big picture.

But last week's public opinion appeared almost one-sided tendencies, which added a bit of unhealthy shadow to the healthy development of the bull market. I think it is necessary to stand up and speak, and it is necessary to drum up and shout for the healthy development of China's stock market, and let some writers who do not really understand the stock market or distort the intentions of the state mislead investors, so that the wrong cars in the bull market will eventually lose money or even lose their blood.

In front of the cardinal principles, I have to say.

First of all, the huge turnover of 12500 billion dollars is good or bad? To say this, we should first say how the 12500 billion came from, and many people say that it is caused by huge incremental capital. Many of these huge incremental funds are allocated to capital stocks and financing. In fact, I do not deny that this is a partial fact, but how big the amount is, I think it is a question mark.

If you use Sina's publicly traded stock trading data, it is found that the most popular citic securities account for only 230 million on the day, and most of them are super large orders, which are not formed by the allocation and financing of ordinary retail investors.

So how do these huge volumes come into being? My personal explanation is the change of positions in large institutions. For example, if the market value of 2 trillion of the fund changes 50 billion in the same day, then the volume of pactions is 100 billion of the turnover. There are also a large number of venture capital, QFII, private equity funds and other institutions. If they have the equivalent turnover, the turnover will not be less than 300 billion, which will account for 400 billion of the daily level. Ordinary retail investors are more interested in changing positions. If the fund is so, how much will it be?

It can be corroborated that on the day of the 12500 billion huge turnover, the net outflow of funds is available, which can be proved from a number of paction data.

Not only is this day, but a few days before it is dominated by net outflow.

Since such a huge volume of pactions has not affected the so-called national capital moving to the stock market, what country's financial security is it coming from? Is this too alarmist? It has been rumor from the SFC level, and it has not directed the brokers' two financial integration as window guidance. I don't think there is any leader to shoot the table and say what's going on with the country's financial security, because our national leaders rely on data to speak, and there is no such thing as easy to be on the surface.

OK, in fact, the recent massive turnover is the result of the whole market changing positions. What kind of warehouse are they changing? I think the organization is increasing the number of financial blue chips and reducing the number of non financial theme stocks. Under this powerful demonstration effect, market investors are converging in this direction. Because of the fierce action, finally, in December 9th, there were 12500 billion of the two cities in the world.

Knowing the reason, we have to answer whether such a large amount of change is correct behavior.

To answer this question, first of all, we need to find out whether the value of A share financial stocks has been overestimated.

In fact, what we are seeing is the sharp increase in trading volume and the huge profits brought by the two financial businesses. In fact, more profits are still waiting for brokers, such as stock options, T+0, new three board market maker system, asset securitization, direct investment business, magnifying leverage, international level, Shenzhen Hong Kong Tong, American Stock Exchange and possible merger of securities brokers in financial reform to form a real investment bank. Of course, interest rate cuts will be even more favorable. If I am not mistaken, the performance of brokerages in the next three years will be doubled. In this way, the valuation theory of securities companies can see more than 100 times, which is the same as that of many GEM stocks. Take the most controversial brokerage unit as an example. Since most of us think of it as a bull market, the broker is the biggest beneficiary of the bull market.

Why do we have a slump? Is it just a matter of public opinion? Of course not. After the inflation, of course, we need to adjust (even if there is a considerable increase in the future). When we adjust, we will find reasons for finding out the so-called leaders' temper. What kind of pig opinion theory does the public do not understand the stock market? Objectively speaking, public opinion is not always right. I have raised countless times. In December 1996, the bubble represented by the authoritative media was represented by the east big Arab pie. Now the stock price has doubled 50 times, but at that time many people could not understand some seemingly unreasonable facts.

When we look back on these past events, should we be ashamed of ourselves for not understanding the stock market and making comments?

Take bank shares as an example. At present, the average price earnings ratio of A share listed banks is about 6 times higher than that of the US stock market. If we compare the rich countries, Citigroup, HSBC, East Asia and other banks in Hongkong, we will find that the average price earnings ratio of these banks is about 15 times, and the market rate is mostly 1.5-2 times. Some of them are more than several times, and these data are two to three times that of ours.

Comparing the growth of these banks, we find that the growth level of our banks is above most of the other banks. If the value of the A shares is rising, they will at least be underestimated by more than 50%.

Why did the A share banks be depressed to such valuations in the past? A lot of people attributed the reason to the economic downturn. Actually, this is not the reason at all. China's economy no matter how to grow more than 7%, how to call the economic downturn, should be called the slowdown in economic growth. The valuation of A share banks is so low that many domestic and international banks believe that most banks in China are bankrupt.

The main reason for bankruptcy is the involvement of the local financing platform in banks, which lies in the fetters of the real estate bubble, the decline of the core capital adequacy ratio and the rise of the bad debt rate.

Well, are these situations solved now? I think the basic solution has been solved or is expected to be solved. In the first place, the Asset Management Co, which is responsible for the local debt financing platform, has been established in the first place. The solution is to fundamentally solve the bank's involvement in the local financing platform. The second move is to issue preferred stock, which has largely solved the problem of insufficient core capital adequacy ratio; the third is the deregulation of the real estate industry, which has greatly reduced the fatal threat to the banks caused by the burst of the real estate bubble.

With these three measures, the fatal risk of banks is basically lifted. Under the premise of the 7% growth rate of China's economy and financial reform, China's banking stocks have no reason not to enjoy higher valuations. Even if they only return to the 10 times price earnings ratio, because the bank's performance is still growing, then there is reason to believe that the bank's stock price can rise by more than 50% on the existing basis. If reform is favorable, doubling it is possible.

Why did the financial stocks break out in the last half month? Because we started cutting interest rates in the near future, and the funds entered the overall loose.

The opening of Shanghai and Hong Kong is also bringing fresh blood to the market. Do not tell me that the daily amount is not used up. With the full outbreak of the A share market, Shanghai and Hong Kong will bring a lot of foreign capital to the A share market, because the funds are all profitable and why the global capital flows only to the high American market. Is it because the United States is appreciating the non US currency? It is not what I said, it is the famous investment bank in the United States and the important purpose of the US Secretary of state to travel to China.

Therefore, the trillions of pactions in Shanghai and Shenzhen stock markets are actually a portrayal of the return of large institutions and millions of investors to blue chips.

China's stock market has been scrambled for a long time. Today, the rational market is returning. Why should it be widely criticized by the society? It can only be said that our public opinion and market are too accustomed to take it for granted. Without in-depth analysis of its causes, it is very harmful to conclude blindly.

What's more, the so-called experts compare the largest US market in the world. It is worth noting that the US market has long advocated value investing, and it has no need to change hands like A shares.

I can say for sure that such a big turnover in the A share market may happen many times in the future, but after such a thorough change in investment philosophy, the future will also greatly reduce the turnover rate, like the United States.

Therefore, last week's trillion dollar deal is a good thing. It signifies that the Shanghai and Shenzhen stock markets are finally moving towards the blue chip era. China's capital market finally has the volume conditions to catch up with the US market, though this surmounting also requires a lot of basic work and considerable efforts.

Of course, there is another voice in the market, that is, the blue bull market is not a real bull market.

What I want to say is that I never thought that the gem was mostly garbage. Instead, I think the growth enterprise market will still have larger room for growth in the future. And I have always been a supporter of the gem, but since December 2012, the gem has risen from 585 to the highest 1631 this year.

Very low valuations are slightly higher, and shopping is certainly cheaper.

Once the blue chips return to fame, they will rise.

The blue chip and innovation will go up together, because China's economy is gradually taking the road of ZTE, and the A share market should enjoy a higher level.

Therefore, the rise of the stock market is normal.

The great advantage of this ZTE road is gradually emerging, and the reform has injected strong impetus to Zhongxing.

The valuation of financial stocks is only a valuation under the existing conditions. I can say for sure that if the insurance of banks and brokerages take the way of absorbing and merging the world's popular financial holding groups, financial stocks will usher in the sharing of resources and the co prosperity situation of 1+1+1 greater than 3. Once the artificial fetters of the past have been broken, the financial industry of our country will burst into more powerful vitality.

Have you ever thought of such a truth, but the Central Committee has already begun to do it? What is the best part of the game?

Please do not use any big wind, pigs will fly to explain the current market, the word "vulgar", another word is "stupid"; bank shares are pigs, which are below the net assets, the price earnings ratio is less than 10 times the stock price in the next three years will come to what price, you may not think, maybe you will then say that you are a pig in the heart, because gold is sold as a Chinese cabbage, it is considered normal, is not a pig and what is it?