PLEASE QUICKSOMEONE GIVE ME THE # OF DEFLATIONS PER MACYS DAY PARADE OVER THE LAST 10 YEARS. https://t.co/gDlENR4H3G ...

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **China** economy, specifically analyzing the **nominal Fixed Asset Investment (FAI)** trends and their implications for deflation and economic growth [1][3][10]. Core Insights and Arguments 1. **Declining Nominal FAI**: China's nominal FAI is experiencing a broad-based contraction, with significant declines in real estate (14%), infrastructure (30%), and manufacturing (37%) sectors [4][10]. 2. **Investment Scenarios**: Three potential scenarios for the future of nominal FAI and economic growth are outlined: - **Base Case**: Policy measures boost infrastructure FAI and stabilize labor markets through non-tech exports, leading to a moderate easing of deflation [10][54]. - **Weak FAI with Strong Exports**: Nominal FAI remains weak, but a strong recovery in exports could sustain GDP growth and ease deflationary pressures [10][55]. - **Weak FAI and Exports**: Continued weakness in both nominal FAI and exports could exacerbate labor market issues and intensify deflation [10][56]. 3. **Investment Momentum**: The report highlights a significant deceleration in investment momentum across various sectors, raising concerns about the macroeconomic setup and the need for consumption-boosting measures [13][14]. 4. **Infrastructure Investment**: Infrastructure FAI growth has sharply declined to -12.1% year-on-year as of October 2025, with expectations for modest acceleration in 2026 due to additional local government bond issuance [20][22][23]. 5. **Manufacturing Sector Challenges**: The slowdown in manufacturing FAI is attributed to a decline in non-tech exports and anti-involution efforts, with expectations for a recovery in non-tech exports beginning in Q1 2026 [29][30]. 6. **Real Estate Sector Contraction**: Real estate FAI has seen a significant decline, with growth at -24.1% year-on-year in October 2025, and a continued contraction expected in 2026 [34][35][40]. Additional Important Insights - **Fiscal Deficit**: The augmented fiscal deficit has narrowed by 1.2 percentage points in the past three months, indicating a tightening fiscal environment [21][24]. - **Policy Measures**: Policymakers are considering a mortgage interest subsidy program to support the real estate market, but details on its implementation remain unclear [36][39]. - **Sectoral Performance**: The manufacturing sector is facing broad-based slowdowns, with specific sectors like energy storage expected to perform better due to government focus [30][32]. This summary encapsulates the critical insights from the conference call regarding the current state and future outlook of the Chinese economy, particularly focusing on investment trends and their implications for deflation and growth.

Summary of the Conference Call on Mortgage Relief in China Industry Overview - The focus is on the **Chinese housing market** and the potential for **mortgage relief** measures to stabilize housing prices and listings [1][2][3]. Key Points and Arguments 1. **Current Housing Market Conditions**: - Housing prices in China have seen a significant decline, leading to a feedback loop of "higher listings/lower prices" which exacerbates deflationary pressures [3][10]. - A deeper downturn in the housing market poses risks to the forecast of shallower deflation in 2026 and lowflation in 2027 [3][10]. 2. **Proposed Policy Measures**: - The Chinese government is considering **interest subsidies** to reduce mortgage costs without negatively impacting banks' net interest margins (NIM) [4][10]. - This approach is seen as a targeted rate cut that avoids the limitations of conventional rate cuts [4][10]. 3. **Cost Implications**: - A broad-based 100 basis points (bps) subsidy could cost approximately **Rmb 400 billion** annually, while a targeted subsidy for new mortgages would cost around **Rmb 100 billion** per year [6][10]. 4. **Policy Design Considerations**: - The effectiveness of the subsidy program will depend on its **scope** (whether it covers new or existing mortgages), **magnitude** (the size of the subsidy), and **duration** [5][10][11]. - A sufficiently broad and generous program could support new home sales and alleviate pressures in the secondary market, helping to stabilize prices [10][12]. 5. **Potential Impact**: - If implemented broadly (covering all mortgages) and generously (100 bps for five years), the program could significantly boost new home sales and ease supply pressures in the secondary market, thereby reducing price headwinds [12][10]. - This would align with the expectation of narrower deflation in 2026 and a clearer exit from deflation in 2027, particularly as housing prices stabilize in higher-tier cities [12][10]. 6. **Risks to Monitor**: - A narrow scope of the subsidy (only covering new mortgages) may lead to limited improvements in new home sales, failing to offset secondary market listings and providing minimal support to prices [13][10]. - Delays in execution and entrenched expectations of falling prices could undermine the effectiveness of the policy [13][10]. Other Important Considerations - The program's design and implementation details remain unclear, making immediate action unlikely [10][11]. - The policy direction is consistent with the forecast for "less deflation" in 2026 and a transition towards lowflation in 2027 [10][12].

RT Flaming.hodl ₿ (@flaming_hodl)@meeDamian @NickSzabo4 The government has been stealing efficiency gains out of the economy through money printing. Efficiency should make everything less expensive through deflation but instead the government prints enough money to keep inflation at 2%. With 3% deflation means they are taking 5%. ...

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Chinese Economy and Key Economic Indicators - **Focus**: Economic performance in October 2025, including industrial production, retail sales, fixed asset investment (FAI), and property sector dynamics Core Insights and Arguments 1. **Industrial Production**: - Industrial production growth slowed to **4.9% y-o-y** in October from **6.5%** in September, below market expectations of **5.5%** [2][7] - The slowdown was attributed to distortions from the mid-autumn festival and Golden Week holiday [2][7] - Average industrial production growth for September-October was **5.7%**, still above **5.5%** in July-August [2] 2. **Retail Sales**: - Retail sales growth inched down to **2.9% y-o-y** in October from **3.0%** in September, slightly above market consensus of **2.8%** [3][12] - Catering services saw significant growth, rising to **3.8% y-o-y** from **0.9%** in September, aided by the extended holiday [3][14] - Sales of home appliances and autos contracted sharply, with home appliances down **14.6%** and autos down **6.6%** [3][15] 3. **Fixed Asset Investment (FAI)**: - FAI contracted further to **-11.2% y-o-y** in October from **-6.8%** in September, significantly below market expectations [4][16] - The decline was broad-based, with manufacturing and infrastructure investments also showing negative growth [4][16] - The property sector remains a primary drag on FAI, with property investment down **23.1% y-o-y** [5][20] 4. **Property Sector Dynamics**: - The property sector's decline deepened, with new home sales by value down **24.1%** and by floor space down **18.6%** [5][20] - New home starts and completions also worsened, dropping **29.6%** and **28.4%** respectively [5][21] - Housing prices continued to decline, particularly in tier-1 cities, with existing home prices down **0.95% m-o-m** [5][22] 5. **Macroeconomic Policy Outlook**: - The focus of policy may shift towards ensuring short-term stability and addressing deflation, with fiscal expansion likely to be prioritized [1] Additional Important Insights - **Export Performance**: Average growth of export-delivered value was **0.9% y-o-y** in September-October, an improvement from **0.2%** in July-August [2] - **Sector-Specific Trends**: - Manufacturing investment growth declined to **-6.7% y-o-y** in October, influenced by the anti-involution campaign [17] - Infrastructure investment growth also dipped to **-12.1% y-o-y** [19] - **Consumer Behavior**: The contraction in durable goods sales indicates a shift in consumer spending patterns, with a notable decline in home appliances and autos [15] This summary encapsulates the critical economic indicators and trends affecting the Chinese economy as of October 2025, highlighting areas of concern and potential policy responses.

Market Overview - Wall Street indices experienced declines between 0.9% and 2%, with small caps underperforming, while European markets also fell across the board [3] - The VIX "fear index" for the S&P 500 reached its highest close in a month, indicating increased market volatility [2] - U.S. energy and financial sectors saw a drop of 2%, while technology and materials sectors fell by 1.5% [3] Cryptocurrency Insights - Bitcoin experienced a significant decline of nearly 30% over six weeks, reflecting the volatile nature of cryptocurrencies [1][6] - Bitcoin's price hit a seven-month low below $92,000, indicating a bearish sentiment in the market [3] Economic Indicators - Japan's economy contracted for the first time in six quarters, with a 1.8% decline, which was less severe than the anticipated 2.5% drop [6][7] - China's annual consumer inflation was marginally positive in October, but producer prices fell for the 37th consecutive month, indicating ongoing deflationary pressures [9][10] Trade and Export Dynamics - China is experiencing a surge in exports, particularly to Asian markets, with exports to Asia increasing by $150 billion this year [13] - The current export boom differs from previous trends, as China now exports higher-value goods such as autos and electric vehicles, impacting global competition [15][16] Inflation and Price Impact - A potential 10% fall in Chinese export prices could lead to a decrease in U.S. producer prices by 0.1-0.2% and by around 0.6% in Southeast Asia [18] - The ongoing disinflation in China may provide some relief to U.S. policymakers concerned about inflation [19]

Summary of the 2026 China Equity Strategy Outlook Industry Overview - The report focuses on the **China equity market**, particularly the **MSCI China** and **Hang Seng Index**. - 2025 was a strong year for Chinese equities, with both indices rising over **30% YTD**, making China one of the best-performing major equity markets in 2025 [2][10]. Core Insights and Arguments 1. **Stabilization and Sustainability in 2026**: - 2026 is viewed as a year of stabilization following the high returns of 2025, with a focus on sustainability [2][13]. - The report anticipates moderate **EPS growth of 6%** and a **12-month forward P/E range of 12-13x** for MSCI China [3][19]. 2. **Index Targets**: - New December 2026 targets are set at: - **Hang Seng**: 27,500 (2% upside) - **HSCEI**: 9,700 (2% upside) - **MSCI China**: 90 (3% upside) - **CSI300**: 4,840 (4% upside) [3][20]. 3. **Market Dynamics**: - The report highlights several factors influencing the market: - Quality and sustainability of corporate earnings [2][13]. - Limited valuation upside after a significant re-rating [2][16]. - Persistent deflationary pressures expected through 2026 [2][17]. - Global macroeconomic uncertainties, particularly regarding US growth paths [2][18]. 4. **Sector Preferences**: - A **barbell strategy** is recommended, overweighting high-quality internet and tech leaders while underweighting sectors like Real Estate, Consumer Staples, and Energy [5][43]. - Select exposure to dividend plays is maintained for stable cash returns [5][43]. 5. **Investment Flows and Liquidity**: - Positive net flows and liquidity are expected for both A-share and offshore markets, driven by consumption stimulus and housing inventory digestion [4][41]. - Strong interest from global investors is noted, with expectations for continued support for the Hong Kong market [4][41]. Additional Important Insights 1. **Earnings Growth Forecast**: - Earnings growth is expected to re-accelerate to **10% in 2027**, as the economy emerges from deflation [19][52]. - The report indicates a slight deterioration in earnings delivery for 2025, leading to a lowered earnings growth forecast of **5%** for that year [51]. 2. **Geopolitical Considerations**: - An interim truce between the US and China is seen as beneficial for alleviating market concerns [13][47]. - The report emphasizes the importance of sustained geopolitical stability for market performance [26][29]. 3. **Valuation Insights**: - Current valuations for MSCI China are seen as fair, trading at **13.1x** forward P/E, which is above the 5-year average [16][19]. - The bull-bear spread for MSCI China indicates a wide range of potential outcomes, from a **-34% bear case** to a **+30% bull case** [33][34]. 4. **Key Trade Ideas for 2026**: - Focus on thematic lists and tactical trades related to Stock Connect Southbound inclusion beneficiaries and anti-involution initiatives [5][44]. 5. **Market Performance Metrics**: - The report includes performance metrics for various indices, highlighting the strong performance of MSCI China and Hang Seng in 2025 [14][22]. This comprehensive outlook provides a detailed analysis of the expected trends and dynamics in the China equity market for 2026, emphasizing the importance of strategic stock selection and sector positioning amidst a backdrop of macroeconomic challenges and geopolitical considerations.

Group 1 - Nobel Prize-winning economist Paul Krugman argues that President Trump's policies are making America less affordable, contradicting his economic promises [1][2] - Krugman states that inflation is rising due to tariffs on imported goods, which are increasing consumer costs [2][3] - The economist links Trump's immigration policies to rising grocery bills, emphasizing that deportations are affecting the agricultural workforce [3] Group 2 - Krugman warns that political leaders promising to lower prices significantly should be viewed with skepticism, as overall economic stability aims for a low, steady inflation rate around 2% [4] - He characterizes deflation as detrimental to the economy, asserting that any politician promising substantial price reductions is either ignorant or dishonest [5] Group 3 - Benchmark indices fell sharply amid uncertainty due to a government shutdown, with investors awaiting critical economic data [6] - The SPDR S&P 500 ETF Trust (NYSE:SPY) closed down 1.66% at $672.04, while the Invesco QQQ Trust ETF (NASDAQ:QQQ) declined 2.04% to $608.40 [7]

Summary of Key Points from the Conference Call Industry Overview - The discussion centers around the **Chinese economy**, specifically focusing on inflation metrics such as **CPI (Consumer Price Index)** and **PPI (Producer Price Index)**, and the potential for reflation in the coming years [1][2][3]. Core Insights and Arguments 1. **CPI and PPI Trends**: - Recent CPI has shown a year-over-year increase of **1.2%**, the highest in nearly four years, while PPI deflation has narrowed for three consecutive months [2][3]. - However, the increase in CPI is largely attributed to temporary factors, indicating that reflation is not yet underway [2][4]. 2. **Temporary Factors Influencing CPI**: - The October CPI increase was driven by short-lived factors such as the "super Golden Week," a favorable base effect, and rising gold prices [4][16]. - The PPI increase was influenced by non-ferrous metals, particularly copper, and a surge in demand for daily sundry items due to early shopping events [4][16]. 3. **Weak Domestic Demand**: - Despite some positive indicators, final demand remains weak, primarily due to a downturn in the housing market and stagnant wage growth [2][6]. - The consumer goods trade-in program, which previously supported core CPI, is losing effectiveness, with participation rates dropping significantly [5][8]. 4. **Deflationary Pressures**: - The ongoing housing market adjustment continues to negatively impact household sentiment, contributing to a deflationary loop that suppresses wage growth [6][10]. - The overall policy framework remains focused on technology and supply, with limited immediate relief for domestic demand [2][21]. 5. **Future Outlook**: - The expectation is for a gradual reflation process from **2026 to 2027**, with the GDP deflator likely remaining negative in **2026** before turning slightly positive in **2027** [2][21]. - Successful reflation is contingent upon economic rebalancing and a shift towards a more balanced growth model, which may take time to implement [21][22]. Additional Important Insights - **CPI Measurement Limitations**: - The CPI may not fully capture underlying price dynamics due to its inclusion of non-market-based components, such as imputed rents for owner-occupied housing [13][16]. - The relatively low weight of housing rent in China's CPI (approximately **5%**) compared to other countries may understate the impact of housing market adjustments on inflation [16][19]. - **Gold Prices Impact**: - The recent surge in gold prices has inflated CPI figures but does not indicate domestic reflation, as the increase is driven by global demand rather than local consumption [16][19]. This summary encapsulates the key points discussed in the conference call regarding the current state and future outlook of the Chinese economy, particularly in relation to inflation and reflation dynamics.

China's economy is facing a new threat. While most of the world battles inflation, China is grappling with consumer prices that are just too low. And it could be worse than the official numbers tell us.China's official consumer inflation data offers limited detail, and it's not entirely clear how it's tracked. Bloomberg tracked 67 everyday items and found that prices are falling in 51 of them. And the pain of spreading.A brutal price war is breaking out across China's entire economy. If one company starts c ...