Group 1: Strategy - The international monetary system exhibits a stable "center-periphery" structure, where dominant currencies have changed over time, but the underlying order remains consistent. This order is rooted in trust and the "high-order belief" in sovereign currencies, which are supported by national credit and legal tender, creating liquidity premiums and network effects, thus exhibiting natural monopoly characteristics [6]. - The formation of central currencies relies on economic, financial, and institutional advantages, maintained through positive feedback loops. However, when debt expansion exceeds fiscal and institutional constraints, emerging countries may seize the opportunity to rise as old centers decline. Currently, the foundation of the dollar system is weakening, and global economic diversification is accelerating. If the RMB can leverage institutional reforms and market openness, it may enhance asset depth and international trust, potentially leading to a more balanced multi-center global currency system [6]. Group 2: Macroeconomy - Since 2022, geopolitical factors, "de-dollarization," and the continuous growth of U.S. debt have driven gold prices higher. The demand for gold is primarily influenced by central bank purchases, which have become a significant source of demand in recent years. However, as gold prices rise, some central banks have begun to reduce their gold holdings temporarily, as the ratio of gold to reserve assets exceeds their targets. Overall, there may still be room for an increase in the global allocation of gold by central banks [10]. - The U.S. stock market has experienced a long-term bull market since the 1980s, driven by economic structural transformation and the information technology revolution, which provided substantial expansion opportunities for companies. Stable capital inflows have translated future economic potential into current stock market valuations, resulting in stock market growth rates significantly exceeding economic growth rates [12]. - Japan's economy underwent a structural transformation during the "lost two decades" post-1990, which created investment opportunities despite overall macroeconomic challenges. The structural rise in Japan's stock market reflects this transformation, driven by corporate globalization, high-tech leadership, and improved corporate governance. Excluding the "old economy" sectors heavily exposed to domestic real estate and deflation, the "new economy" sectors have shown strong trends since the 1990s [14].

Core Viewpoints - The evolution of the international monetary system has consistently exhibited a stable "center-periphery" structure, where a few currencies dominate while the majority remain peripheral [2][3][4] - The stability of the monetary order is rooted in the nature of money as a "high-order belief," where individuals accept currency based on mutual trust in its value and acceptance by others [2][28] - The transition from one dominant currency to another is rare and often requires a combination of economic shifts and institutional reforms to facilitate the emergence of a new center [3][4] Historical Evolution of the International Monetary System - The historical perspective shows that the monetary order has maintained internal stability, with dominant currencies typically lasting one to two centuries [5][6] - The shift from the Spanish dollar to the Dutch guilder marked a transition from metal-based currency to credit-based systems, emphasizing the importance of financial innovation and institutional credibility [9][11] - The establishment of the classical gold standard in the 19th century created a more structured international monetary order, driven by the need for exchange rate stability and transaction efficiency [12][13] The Role of Trust and Institutional Frameworks - The essence of money is a social contract based on trust, where its value is derived from the issuer's commitment to honor debts [27][28] - Sovereign currencies differ from commodity or cryptocurrency due to state backing and legal tender status, ensuring their acceptance and circulation [28][29] - The natural monopoly of money arises from network effects, where increased usage enhances liquidity and reduces transaction costs, leading to a self-reinforcing cycle [29][30] Current Trends and Future Outlook - The current dollar-centric system is facing challenges as global trade and capital flows diversify, with potential for the renminbi to rise as a reserve currency through reforms and market-driven mechanisms [5][26] - The international monetary system is undergoing structural changes, with emerging economies seeking greater independence in currency management and exchange rate flexibility [25][26] - The ongoing geopolitical tensions and financial sanctions have prompted a reassessment of the dollar's safety as an asset, leading to increased diversification in the global monetary landscape [26][39]

Core Viewpoint - Industry profit forecasting has a positive effect on stock price performance, with long-term returns decomposed into dividend yield, profit growth rate, and price-earnings ratio changes [3][9] Group 1: Industry Profit Forecasting - Profit growth rate is the core driver of stock value growth and is more predictable than price-earnings ratio changes [3][9] - Forecasting profit growth can enhance the performance of industry portfolios, with a hypothetical high-growth portfolio outperforming equal-weighted and low-growth portfolios [3][9] - The industry prosperity model reflects future industry profit status through demand and supply indicators, providing support for stock price return predictions [3][11] Group 2: LLM Empowerment in Model Construction - LLM improves the efficiency of constructing industry prosperity models by enhancing qualitative analysis and indicator selection [4][5] - A structured process using LLM for qualitative screening and quantitative testing results in a reliable industry prosperity index that predicts profit growth [5][17] - The constructed prosperity index shows predictive capability for future profit growth, with average and median rank correlation coefficients around 0.25 across different industry levels [5][26] Group 3: Application of Industry Prosperity Index - The industry prosperity index has various applications, including industry timing, rotation, stock selection, and risk warning [6][38] - High-prosperity industry portfolios demonstrate superior long-term performance compared to equal-weighted portfolios, with annualized excess returns of 2.4%, 2.9%, and 2.8% for different industry levels [6][7] - Sensitivity tests indicate that high-prosperity portfolios maintain stable excess returns over time, outperforming low-prosperity and equal-weighted portfolios [50][43]

Core Viewpoint - The article emphasizes the ongoing trend of re-industrialization in the U.S., focusing on three main investment themes for 2026: robust public infrastructure projects, a rebound in industrial equipment investment after a three-year downturn, and the growth of the data center industry driven by AI infrastructure [2][3]. Investment Themes - **Theme 1: Public Infrastructure Projects** The article predicts a strong recovery in non-residential construction investments, particularly in sectors like manufacturing and soft infrastructure, driven by large public projects [2][3][9]. - **Theme 2: Industrial Equipment Investment Rebound** Following a three-year decline, the industrial equipment investment indicators are expected to recover, reflecting renewed production activities in the manufacturing sector [3][30]. - **Theme 3: Data Center Industry Growth** The demand for AI infrastructure is anticipated to significantly boost the data center industry, with projected investments of approximately $100-110 billion in 2026, despite a decrease in growth rate from previous years [3][46][49]. Manufacturing Sector Dynamics - The article highlights that the re-shoring of manufacturing is positively impacting construction investments, particularly in sectors like semiconductors, batteries, and pharmaceuticals, with a projected annual investment increase exceeding $300 billion under optimistic scenarios [7][30]. - From 2021 to 2024, the U.S. manufacturing sector is expected to see a substantial increase in construction investments, with a projected growth of 184% from $816 billion in 2021 to $2.321 trillion in 2024 [31]. Infrastructure Investment Trends - The Infrastructure Investment and Jobs Act (IIJA) is driving a significant increase in public infrastructure spending, with $1.2 trillion authorized for infrastructure projects, of which $550 billion is allocated for new investments [14][15]. - As of the end of 2024, 21% of the planned projects under the IIJA have been funded, indicating a strong pipeline for future infrastructure investments [15]. Employment and Labor Market Insights - The article notes that employment in the non-residential construction sector has accelerated due to infrastructure spending, although growth rates are expected to decline post-2024 [18][21]. - The labor market in the construction sector is expected to remain robust, with a shift towards specialized contractors as the focus moves from large public projects to ongoing maintenance and upgrades [18][21]. Sector-Specific Insights - The article identifies that the commercial construction sector is experiencing a structural divide, with data center projects leading the way, while traditional commercial investments are lagging [23][25]. - The residential construction sector is projected to recover in 2026 after a period of decline, with new housing starts expected to stabilize [25][30]. Conclusion - Overall, the article presents a comprehensive analysis of the U.S. re-industrialization trend, highlighting significant investment opportunities across various sectors, particularly in infrastructure, manufacturing, and data centers, driven by government policies and technological advancements [2][3][30].

Group 1 - The CICC Global Institute (CGI) is positioned as a new type of think tank under CICC, focusing on public policy research and decision-making in China, and participating in international policy discussions [2][4] - CGI aims to build capabilities and teams to study major issues related to the long-term development of the Chinese and global economy, finance, and capital markets, providing services through research consulting, thematic forums, international exchanges, and lecture series [4] Group 2 - Dr. Peng Wensheng, the Chief Economist of CICC, serves as the Director of the CICC Global Institute, while Dr. Wu Huimin, the Executive Director of the Research Department and head of the ESG Office, serves as the Executive Dean [4]

Core Viewpoint - The article discusses the structural rise of the Japanese stock market during the "lost two decades" post-1990, emphasizing that despite overall economic stagnation, there were significant structural changes and investment opportunities within the market [3][4]. Group 1: Structural Market Changes - Japan experienced a structural rise in its stock market driven by economic transformation, including increased overseas exposure, high-tech leadership, and improved corporate governance [3][4]. - The "new economy" sectors, excluding the "old economy" sectors heavily exposed to real estate and deflation, showed a strong upward trend post-1990, particularly in industries such as industrial, technology, communication, and even consumer sectors [3][12]. - The Nikkei index recorded negative returns overall, but the "new economy" index achieved an annualized compound return of 7.3%, outperforming other Asian countries and aligning closely with global averages excluding the U.S. [12][14]. Group 2: Overseas Exposure - Japan's export growth continued post-1990, with the export-to-GDP ratio rising from 10% in the early 1990s to 20% before the global financial crisis, with industrial goods and capital equipment making up a significant portion [24][26]. - Outward Direct Investment (ODI) increased significantly, from 0.3% of GDP in 1993 to 2.2% in 2008, with manufacturing being the primary focus, particularly in high-end sectors [26][29]. - The increase in ODI led to a rise in overseas production and sales, with overseas branches contributing over 30% to the revenue of Japanese manufacturing firms [31][32]. Group 3: High-Tech Leadership - Japan maintained a strong position in high-tech sectors despite domestic economic stagnation, with high-tech product exports consistently accounting for over 85% of total exports since the 1990s [42][44]. - R&D investment as a percentage of GDP rose from 2.5% to over 3%, surpassing the OECD average, indicating a commitment to innovation and technological advancement [42][44]. - Labor productivity in manufacturing increased by 50% during the "lost decade," reflecting the positive impact of high-tech industries on overall economic performance [51][53]. Group 4: Corporate Governance Improvements - Post-1990, Japan's corporate governance underwent significant changes, with an increase in foreign investor participation leading to a focus on profitability and shareholder returns [60][62]. - Reforms in corporate governance included lowering litigation costs for minority shareholders, aligning management compensation with company performance, and allowing stock buybacks, which improved shareholder value [63][67]. - The financial health of "new economy" sectors improved significantly, with return on equity (ROE) surpassing that of "old economy" sectors, indicating a shift towards more sustainable and profitable business practices [69][70]. Group 5: Stable Capital Inflows - Stable capital inflows, particularly from long-term and overseas investors, provided essential support for the structural rise of the Japanese stock market [74][76]. - The proportion of overseas funds in the Japanese stock market increased significantly post-bubble, contributing to improved corporate governance and performance [76][80]. - Long-term funds, especially from insurance and pension sectors, remained stable, while domestic retail investor participation declined, highlighting a shift in market dynamics [74][79].

Core Viewpoint - The tin market is experiencing a structural shift with rising prices and demand driven by AI and traditional sectors, while supply remains constrained due to resource depletion and geopolitical factors [2][4][54]. Group 1: Tin Market Overview - Since 2020, tin prices have increased, leading to improved industry profitability and a current PE ratio at the 21st percentile over the past five years [2]. - Tin is one of the most scarce non-ferrous metals, with a global static reserve-to-production ratio of only 16 years in 2024, indicating a tight supply situation [3][7]. - Major tin resources are concentrated in a few regions, with high development levels, and many supply areas have static reserve-to-production ratios below 22 years [4][7]. Group 2: Demand Drivers - AI-driven demand for computing infrastructure and smart devices, along with the electrification of vehicles, is expected to accelerate tin solder demand, projected to grow at a CAGR of 7% from 2024 to 2030 [3][12]. - Traditional demand is anticipated to benefit from global monetary easing and the increasing need for "strategic stockpiles" amid geopolitical tensions, with overall global tin demand expected to grow at a CAGR of 4.3% from 2024 to 2030 [3][13]. Group 3: Supply Constraints - Key producing regions like China, Indonesia, and Myanmar face significant supply challenges, including declining reserves and frequent disruptions [4][28][38]. - China's tin reserves have decreased by 52% from 2001 to 2024, with a static reserve-to-production ratio dropping to 14 years [28][29]. - Indonesia's tin industry is grappling with resource depletion and regulatory changes that exacerbate supply disruptions, while Myanmar's production has been severely impacted by operational halts [38][45]. Group 4: Price Outlook - The tin price is expected to rise due to supply constraints and improving demand, with projections indicating a balanced supply-demand scenario from 2025 to 2030 [54][61]. - The global tin supply is projected to grow at a CAGR of 4.6% from 2024 to 2030, while demand is expected to increase at a CAGR of 4.3% during the same period [61][63]. - The industry faces rising costs due to declining ore grades and inflationary pressures, which may further elevate the incentive prices for new projects [63][64].

Core Viewpoint - The lithium battery industry is expected to enter a new growth cycle starting in 2026, driven by stable supply-demand dynamics and advancements in solid-state battery technology [2][4]. Demand - A new growth cycle is emerging, with energy storage expected to become a core growth driver. The domestic market for new energy vehicles (NEVs) is benefiting from increased battery capacity and the expansion of new application scenarios, leading to sustained high growth in demand for power batteries [7][10]. - In 2026, the average battery capacity for domestic passenger vehicles is projected to continue increasing, supported by policy adjustments and the introduction of high-capacity fast-charging models [7]. - The European market is anticipated to see accelerated demand recovery in 2026, driven by the launch of new platform models and continued subsidies for NEVs [10]. Supply and Demand - The supply-demand inflection point is approaching, with a confirmed trend of price reversal. By 2025, the demand driven by energy storage is expected to exceed expectations, leading to improved supply-demand relationships and price increases in various segments of the lithium battery supply chain [11][17]. - The overall capacity utilization rate in the industry is expected to rise, with leading manufacturers operating at near full capacity by the third quarter of 2025 [17]. New Technology - The solid-state battery industry is accelerating towards commercialization, with several manufacturers expected to achieve small-scale production by 2026. The focus is on solid-state sulfide batteries, which are anticipated to reach mass production levels [30][31]. - Semi-solid batteries are also gaining traction due to their higher safety and energy density, with commercial production expected to ramp up in various sectors, including electric vehicles and energy storage [29][30]. Investment Strategy - The investment strategy includes focusing on energy storage demand exceeding expectations, which will drive a reversal trend in the sector. Key recommendations include lithium battery materials, batteries, and related components [5]. - New technologies, particularly solid-state and sodium batteries, are highlighted as high-growth investment directions, with significant breakthroughs expected in 2026 [5][34]. International Expansion - The lithium battery supply chain is accelerating its global manufacturing layout, with significant production expected to come online in 2026 across Europe and Southeast Asia. This expansion is anticipated to mitigate risks associated with geopolitical tensions and trade frictions [25][26]. - Companies are adopting new business models, such as technology licensing, to facilitate entry into markets with high trade barriers, exemplified by CATL's LRS model in the U.S. [27]. Charging Infrastructure - The domestic charging station construction is expected to benefit from supportive policies, while the U.S. market may see a surge in installations due to preemptive actions ahead of tariff impacts [39].

Core Viewpoint - The article discusses the current status, challenges, and potential breakthroughs of commercial health insurance in China, emphasizing its significant social management function in addressing the medical expense payment gap and improving healthcare accessibility [2][10]. Current Status - On a macro level, self-paid medical expenses account for a high proportion of total healthcare costs in China, with personal out-of-pocket expenses reaching 2.5 trillion yuan, representing 27% of total healthcare expenditure in 2023 [12]. - The commercial health insurance payout in 2023 was only 0.4 trillion yuan, accounting for 4% of total healthcare costs, indicating a significant gap in coverage [12]. - The basic medical insurance system covers over 1.3 billion people, achieving a participation rate of around 95%, but it is constrained in its ability to further increase payment proportions due to rising healthcare costs and demographic changes [15][21]. Challenges - The effective supply of commercial health insurance is insufficient, primarily due to a lack of industry infrastructure and product development capabilities [5][25]. - The perception of adequate coverage from basic medical insurance leads to a "sufficient protection illusion," which hinders the demand for commercial health insurance [36]. - The insurance industry has historically focused on rapid expansion through high-premium critical illness insurance, which has limited the development of more integrated health insurance products [43][44]. Potential Breakthroughs - Key variables for breaking the current deadlock include reforms in medical insurance payment systems and support from regulatory bodies to enhance industry infrastructure [5][51]. - The promotion of personal account-based medical insurance and long-term care insurance could provide comprehensive health solutions and open new avenues for industry growth [64][65]. - The increasing income levels and the growing middle-income population in China are expected to drive demand for commercial health insurance, creating a favorable environment for its development [62]. Investment Opportunities - The article identifies four main investment themes: leading internet platforms and large insurance groups building commercial health insurance systems, efficient corporate group insurance channels, reinsurers benefiting from health insurance market growth, and pharmaceutical companies gaining from increased commercial insurance payments [6][66].

Core Viewpoint - The resurgence of the AI bubble has led to significant declines in global tech stocks, impacting markets in the US, China, and Hong Kong, with notable drops in the Hang Seng Tech Index (-7%), ChiNext (-6%), and the "Magnificent Seven" in the US (-6%) [2][4]. Group 1: AI Bubble Concerns - The primary concern driving market declines is the AI bubble, which has become a key economic indicator in the US and China [4]. - Since the launch of ChatGPT in late 2022, the "Magnificent Seven" stocks in the US have surged by 283%, significantly outperforming the S&P 500, which saw a 69% increase when adjusted for the "M7" [4][6]. - In China, the top ten tech companies have risen by 81% since early 2025, outpacing the Hang Seng Index's 19% increase when adjusted for these companies [6]. Group 2: Understanding the Bubble - The discussion around bubbles should focus on identifying the current stage rather than outright denial of their existence [8]. - Bubbles can drive industry development, and historical examples show that significant gains can occur during bubble phases, as seen in the Nasdaq's 256% rise from 1998 to 2000 despite declining profits [9][11]. - Current market expectations for OpenAI's IPO valuation are around $1 trillion, with a P/S ratio of 50x based on projected revenues of $20 billion, which could drop to 25x if revenues double [12]. Group 3: Investment and Demand Analysis - AI demand is categorized into disruptive external innovations and internal cost-saving efficiencies, with the latter already showing results [16]. - AI applications are projected to reduce costs by 9-11%, potentially saving $300 billion annually across the S&P 500 [19]. - Labor productivity in the non-farm business sector has increased by 5.6% since 2023, outpacing the productivity growth during the internet revolution [21]. Group 4: Investment Intensity and Capacity - Current investment levels in AI are less than half of those during the internet bubble, with technology investment growth expected to rise from 6% in early 2023 to 16% by mid-2025 [39]. - The capital expenditure to sales ratio for the "Magnificent Seven" is projected to rise from 9% in Q4 2023 to 15.9% by Q3 2025, indicating a healthy investment environment [41]. - The reliance on debt financing is lower than during the dot-com bubble, with the current debt-to-equity ratio for major tech firms at approximately 81%, significantly below the 124% average during the peak of the dot-com era [43]. Group 5: Market Valuation and Sentiment - The venture capital market is nearing the levels seen in 1999, with significant increases in funding for AI-related ventures [51]. - The dynamic P/E ratio for the "Magnificent Seven" has reached around 28x, close to the levels seen in late 1998, but still below the extreme valuations of the internet bubble [55]. - Investor sentiment is not as euphoric as during the dot-com bubble, with current net bullish sentiment at -5%, contrasting sharply with the 46% seen in early 2000 [59][61]. Group 6: Future Outlook - The current market environment suggests a potential for volatility due to high valuations, but long-term investment opportunities remain, particularly for companies that can effectively integrate AI into their business models [75]. - The overall economic contribution of AI is expected to be stronger than during the internet bubble, with technology investments contributing significantly to GDP growth [32][36]. - The forecast for the S&P 500 index by the end of 2026 is projected to be between 7600 and 7800, indicating a potential increase of 13-16% [78].