Core Viewpoint - The essence of economic crises remains unchanged despite different appearances, characterized by excessive credit expansion, rampant leverage, collective greed, and subsequent panic [1]. Group 1: Historical Context - The Great Depression in 1929 occurred after the U.S. had already established a banking system, leading many to believe that such a crisis would not happen again [1][2]. - The U.S. was the first to enter a true consumer era, with significant industrial growth and widespread automobile ownership [2][4]. Group 2: Economic Dynamics - A hidden flaw existed when factory production efficiency outpaced wage growth, leading to overproduction and unsold goods [6][7]. - The introduction of installment payments transformed American consumption patterns, with 60% of cars and 75% of furniture sold on credit [12][13]. Group 3: Speculative Risks - The period from 1920 to 1929 saw the Dow Jones index rise by 500%, with widespread use of borrowed money for stock trading [17]. - Margin trading allowed investors to amplify their gains, but also their losses, creating significant risk when the market began to decline [18][20]. Group 4: Banking System Vulnerabilities - The absence of deposit insurance and the freedom for banks to invest in the stock market created systemic risks [30][32]. - A bank run occurred as depositors rushed to withdraw their savings, leading to widespread bank failures and a collapse of credit [36][39]. Group 5: Global Impact - The U.S. crisis transmitted globally due to the gold standard, affecting international trade and monetary policies [41][42]. - Countries faced a dilemma between monetary expansion to stimulate economies and the risk of currency devaluation [45][46]. Group 6: Recovery Mechanisms - The New Deal introduced reforms but was not sufficient for a quick recovery; World War II significantly boosted the U.S. economy by increasing industrial demand [47][49]. - The cyclical nature of economic events suggests that understanding these patterns is crucial for mitigating risks [50][52].

Group 1: Supply-Side Reform Background - The supply-side reform aims to address excessive capacity in the midstream and upstream sectors after a decade of expansion in export manufacturing and significant infrastructure investment[1] - In 2015, the capacity utilization rate of industrial enterprises in China fell to 74%, below the international standard of 75% for severe overcapacity[8] - By 2015, 13 out of 14 major industrial sectors were experiencing severe overcapacity, particularly in heavy industries like steel and coal[9] Group 2: Causes of Overcapacity - Overcapacity was primarily driven by excessive external and internal demand expansion, leading to abnormal capacity growth[2] - Local governments, incentivized by GDP growth targets, contributed to overcapacity by supporting state-owned enterprises in upstream investments[2] - The overcapacity issue was exacerbated by repeated construction of heavy industrial projects, driven by local government interests in boosting GDP and tax revenues[10] Group 3: Economic Impact - From 2012 to 2015, domestic industrial prices plummeted, with the Producer Price Index (PPI) recording negative values for three consecutive years[10] - By 2015, the total debt in six overcapacity industries reached 10 trillion yuan, with 8.7 trillion yuan classified as debt[15] - The banking sector faced rising non-performing loan rates, with the total non-performing loan balance reaching 1.2744 trillion yuan by the end of 2015, a 51.2% increase from the previous year[65] Group 4: Capacity Reduction Strategies - The reform included three main strategies: administrative capacity reduction, industry self-discipline with staggered production, and market-driven natural clearance[17][18][79] - Administrative measures focused on controlling new capacity, eliminating outdated capacity, and encouraging enterprise restructuring, particularly in state-dominated sectors like steel and coal[17] - The steel industry saw a reduction of 120 million tons of crude steel capacity from 2016 to 2017, achieving 80% of its capacity reduction target[28] Group 5: Outcomes of Supply-Side Reform - The steel industry's capacity utilization improved significantly, with the industry concentration rising to 60% by 2020[29] - The coal industry eliminated 810 million tons of capacity between 2016 and 2018, exceeding the targets set for the 13th Five-Year Plan[30] - The cement industry's profits increased from 33 billion yuan in 2015 to 154.6 billion yuan in 2018, reflecting improved pricing and profitability[33]

Core Viewpoint - EVE Energy's major shareholder, Liu Jincheng and Luo Jinhong, sold 40.77 million shares at a price of 72.20 CNY per share, raising 2.944 billion CNY, reducing their combined stake from 39.85% to 37.85% [2][3] Financial Performance - For the first three quarters of 2025, EVE Energy reported revenue of 45.002 billion CNY, a year-on-year increase of 32.17%, but net profit attributable to shareholders decreased by 11.70% to 2.816 billion CNY [3] - The company's gross margin for the first three quarters was 15.95%, lower than competitors like CATL and Guoxuan High-Tech [3] - In Q3 2025, EVE Energy achieved a record quarterly revenue of 16.832 billion CNY, up 35.85% year-on-year, and net profit of 1.211 billion CNY, a 15.13% increase year-on-year and a significant 140.16% increase quarter-on-quarter [3][4] Strategic Adjustments - EVE Energy is undergoing a structural adjustment, with significant growth in energy storage battery shipments, which surpassed power battery shipments for the first time [5] - The company secured a procurement agreement for 50 GWh of battery cells from Haibosi Chuang, equivalent to 99% of its total energy storage shipments last year, ensuring future capacity utilization [5] - EVE Energy is planning a Hong Kong IPO to raise 30 billion HKD, focusing on expanding its global production capacity, particularly in Hungary and Malaysia [5] Industry Context - The lithium battery industry is experiencing profound changes, with global demand for power batteries projected at 1500 GWh, while China's planned production capacity exceeds 3000 GWh, leading to significant overcapacity [4] - EVE Energy's third-quarter results reflect a strategic move to mitigate the impact of one-time rebates, which temporarily lowered profits but positioned the company for future growth [4]

专题：2025分析师大会：资本市场"奥斯卡"！机构称A股迎全球资本涌入的大牛市 炒股就看金麒麟分析师研报，权威，专业，及时，全面，助您挖掘潜力主题机会！ 11月28日，2025分析师大会举行，摩根士丹利中国首席经济学家邢自强主题演讲《中国新篇章： 科技 与再平衡》。 邢自强表示，依托丰富的人才储备，中国处于AI创新前沿，中国大语言模型的性价比较高。AI既能增 益、也能替代劳动力，缓解人工智能对劳动力市场造成的扰动，还需更多政策支持。 邢自强认为，人形机器人5万亿美元全球市场大幕拉开，预测到2050年人形机器人累计应用规模将达到 10亿台，其中约30%来自中国。 附演讲PPT 美降温超预期,但持久性缓和仍难以实现 中美缓和超预期 然而在竞争性对抗格局下，中美缓和仍较为懿弱 | | 货量进口 如果大豆 | 2025 Jan | | | | --- | --- | --- | --- | --- | | 一点 在的按照片 | - 10 2 2 10 10 2 2 4 10 10 2 2 10 | | | | | | 全身实质性描述明新芬太原资讯 | Sels | NULL | | | BOTACUL 201202 ...

Group 1: Industry Insights - The Ministry of Industry and Information Technology (MIIT) held a meeting on November 28 to discuss the regulation of the power and energy storage battery industry, focusing on promoting high-quality development and addressing irrational competition [1] - MIIT Minister Li Lecheng emphasized the need for targeted policy measures to combat "involution" competition, enhance capacity monitoring, and improve product quality supervision [1] - The meeting included high-level executives from major companies, indicating strong potential for subsequent actions and policy implementations [1] Group 2: Company Developments - Shengyang Co., Ltd. specializes in the design, R&D, manufacturing, and sales of energy storage batteries and systems, with its solid-state battery successfully completing safety verification and stability tests, now entering market application [3] - Nandu Power's current unshipped orders amount to approximately 8.9 billion, with large storage orders making up about 5.5 billion, indicating strong demand in both domestic and international markets [3] - Nandu Power also secured a 2.8 GWh order for independent energy storage projects, marking a significant milestone for the commercialization of solid-state battery technology [3] Group 3: Market Conditions - Huafu Securities noted that the lithium battery materials industry is facing challenges such as "leading companies making minimal profits while second-tier companies incur losses," primarily due to overcapacity from previous blind expansions [2] - It is expected that most sub-sectors within lithium battery materials will achieve rational and orderly expansion in the coming years, reducing the likelihood of significant overcapacity [2] - Some sub-sectors with low profitability and long return cycles may see price increases, indicating potential market adjustments [2]

Report Industry Investment Rating No relevant content provided. Core Viewpoints - The soda ash market in 2025 was deeply influenced by the expansion cycle of production capacity and the weak growth of demand, leading to a systematic decline in the price center. Periodic rebounds were constrained by high inventory and weak market conditions. For investors, understanding these influencing factors is crucial for making correct judgments, and for producers, seizing market rhythm and supply - demand changes to conduct sell - hedging at high prices is also essential [7][18]. - The process of production capacity clearance is slow, and the proportion of low - cost natural soda ash production capacity is continuously increasing. Although leading enterprises can survive relying on resource endowments, the overall profitability improvement of the industry is limited. The cold repair of float glass has led to a decline in the demand for dense soda ash, and the photovoltaic glass market has turned downward. Light soda ash has become the only growth point. In 2026, the pressure of new production capacity remains, and the profit rebound needs to wait for a substantial contraction in supply or a recovery in glass demand [7][27]. - In 2025, the domestic soda ash production increased significantly compared with previous years. From January to October, the cumulative production was 3,302 million tons, a year - on - year increase of 5.2%. The heavy soda ash ratio fluctuated between 53 - 57%, significantly lower than last year. Multiple production lines were put into operation in 2025, and the supply of soda ash continued to increase. If high - cost alkali plants cannot exit the market smoothly, the pattern of oversupply will be further strengthened. Considering the current industry situation, the annual supply increase in 2026 will be about 1%, with a total production increase of 35 million tons [7][8]. - In 2025, the daily melting volume of float glass remained at a low level, and the photovoltaic glass first increased and then decreased. The total daily melting volume of the two showed a trend of high in the front and low in the back, continuously lower than the same period last year. From January to October, the total daily melting volume of float and photovoltaic glass slightly decreased to 25.0 million tons, a year - on - year decrease of 3.5%, corresponding to a 9.9% year - on - year decrease in the demand for dense soda ash. In addition, from January to October, the demand for light soda ash was relatively strong, with the operating rate at a high level, and the apparent demand increased by 11.8% year - on - year. In 2026, the total demand for soda ash will decrease by 4.8%, a net decrease of 177 million tons, mainly from dense soda ash, with a year - on - year decrease of 15.3% and a net decrease of 312 million tons, while the demand for light soda ash will increase by 8% year - on - year, a net increase of 134 million tons [9][85]. - Since 2025, the domestic soda ash price has been at a low level, with a significant decrease in imports and an increase in exports. In the second half of the year, as the price continued to be low, the net export of domestic soda ash maintained a high level. From January to October, the cumulative net export volume was 175 million tons, while the same period last year was a net import of 9 million tons. It is expected that the net export volume in 2025 will increase to 218 million tons, and in 2026, it will further increase to 257 million tons [66][86]. - In 2025, the supply and demand of soda ash were continuously loose, and the total inventory remained at a high level. The three - link inventory increased from 242 million tons at the beginning of the year to 294 million tons at present, reaching the highest level in the same period in history. According to the supply - demand balance analysis, the supply will increase by 0.9% and the demand will decrease by 6.4% in 2026, and the oversupply situation will continue. After some projects were put into operation in 2025, the high - cost supply will be suppressed at low prices, and the inventory will remain at a high level throughout the year [11][87]. Summary by Directory 2025 Soda Ash Price and Profit Review 2025 Soda Ash Price Center Moved Downward - In 2025, the soda ash price showed an overall downward trend with a narrowing price range. The average ex - factory price of light soda ash from January to October was 1,335 yuan/ton, a year - on - year decrease of 31%, and the terminal average price of dense soda ash was 1,422 yuan/ton, a year - on - year decrease of 31.9%. The price was mainly suppressed by the expansion of production capacity and weak demand [17]. - There were short - term price rebounds in February - March and July, but they were quickly suppressed. From April to June, the price accelerated its decline due to the release of new production capacity, and from August to October, it continued to decline due to weak demand and a decrease in exports [17]. 2025 Soda Ash Industry Profits Ran at a Low Level - In 2025, the soda ash industry was under continuous pressure on profits, showing a deep - loss pattern. The core factors were over - capacity and rising costs. From the beginning to the middle of the year, the losses continued to expand, and the profits of the ammonia - soda process and the combined - soda process continued to deteriorate. In October, the increase in the price of thermal coal led to a decline in the profits of the combined - soda process, and in November, the profits of the ammonia - soda process further declined [27]. - The process of production capacity clearance is slow, and the proportion of low - cost natural soda ash production capacity is increasing. The overall profitability improvement of the industry is limited. In 2026, the pressure of new production capacity remains, and the profit rebound needs to wait for a substantial contraction in supply or a recovery in glass demand [27]. Soda Ash Production Capacity Continued to be Put into Operation, and the Capacity Will Continue to Increase in 2026 2025 New Soda Ash Production Capacity was Put into Operation, and the Annual Supply Continued to Increase - In 2025, the domestic soda ash production increased significantly. From January to October, the cumulative production was 3,302 million tons, a year - on - year increase of 5.2%. The heavy soda ash ratio fluctuated between 53 - 57%, lower than last year [7][33]. - In the first half of the year, with the new production capacity put into operation, the production remained at a high level. In April, the monthly production reached a historical high of 364.2 million tons. In the second half of the year, the production decreased during the summer maintenance period, and then quickly recovered after the maintenance. As of November 21, the operating rate of soda ash enterprises was 82.68%, a month - on - month decrease of 2.12% [33]. Production Capacity Continued to be Put into Operation, and the Supply was Expected to Continue to Increase - Multiple production lines were put into operation in 2025, and the far - reaching Xingneng Phase II 2.8 million - ton natural soda ash project will be put into operation at the end of the year. If high - cost alkali plants cannot exit the market, the oversupply situation will be further strengthened [42]. - Based on the production capacity put into operation in 2025, the soda ash production will continue to increase in the next year. Considering the current industry situation, the annual supply will increase by about 1%, with a total production increase of 35 million tons [44]. The Demand for Dense Soda Ash First Increased and then Decreased, and the Growth of Soda Ash Demand Slowed Down in 2025 In 2025, the Daily Melting Volume of Photovoltaic and Float Glass Decreased, and the Growth of Soda Ash Demand Slowed Down - In 2025, the daily melting volume of float glass remained at a low level, and the photovoltaic glass first increased and then decreased. The total daily melting volume of the two was lower than the same period last year. As of now, the daily melting volume of float glass in production was 158,100 tons, and that of photovoltaic glass was 89,400 tons. From January to October, the total daily melting volume slightly decreased to 250,000 tons, a year - on - year decrease of 3.5%, corresponding to a 9.9% year - on - year decrease in the demand for dense soda ash [45]. - The demand for soda ash from float and photovoltaic glass gradually weakened due to the continuous downturn in the real - estate market and high inventory in the photovoltaic glass market. In addition, the demand for light soda ash was relatively strong from January to October, with an estimated year - on - year increase of 11.8% in apparent demand [51][53]. The Demand for Dense Soda Ash Declined, the Demand for Light Soda Ash Increased, and the Soda Ash Demand Decreased in 2026 - In 2026, the over - capacity problem of photovoltaic glass remains to be solved, and the production progress will slow down significantly. Although real - estate policies are continuously introduced, the glass consumption is difficult to improve. The float glass production will continue to decline, which will suppress the demand for dense soda ash, while the demand for light soda ash will continue to increase with economic activities [58]. - It is estimated that the total demand for soda ash in 2026 will decrease by 4.8%, a net decrease of 177 million tons, mainly from a 15.3% year - on - year decrease in dense soda ash demand (a net decrease of 312 million tons), and an 8% year - on - year increase in light soda ash demand (a net increase of 134 million tons) [58]. Domestic Soda Ash Price Ran at a Low Level, and Soda Ash Exports Increased Significantly - Since 2025, the domestic soda ash price has been at a low level, with a significant decrease in imports and an increase in exports. From January to October, the cumulative net export volume was 175 million tons, while the same period last year was a net import of 9 million tons. It is expected that the net export volume in 2025 will increase to 218 million tons, and in 2026, it will further increase to 257 million tons [66][86]. The Total Soda Ash Inventory is Expected to Remain at a High Level in 2026 2025 Soda Ash Supply and Demand were Loose, and the Total Inventory Ran at a High Level - In 2025, the supply and demand of soda ash were continuously loose, and the three - link inventory increased from 242 million tons at the beginning of the year to 294 million tons at present, reaching the highest level in the same period in history. The inventory of alkali plants remained at a high level, the inventory of delivery warehouses increased significantly, and the inventory days of sample glass factories were relatively stable [70]. 2026 Soda Ash Supply and Demand will Remain Loose, and the Inventory will Remain at a High Level - According to the supply - demand balance analysis, the supply will increase by 0.9% and the demand will decrease by 6.4% in 2026, and the oversupply situation will continue. After some projects were put into operation in 2025, the high - cost supply will be suppressed at low prices, and the inventory will remain at a high level throughout the year [72]. Soda Ash Supply - Demand Deduction and Market Outlook - Supply: Multiple production lines were put into operation in 2025, and the far - reaching Xingneng Phase II 2.8 million - ton natural soda ash project will be put into operation at the end of the year. If high - cost alkali plants cannot exit the market, the oversupply situation will be further strengthened. It is estimated that the production will increase by about 1% in 2026, with a total production increase of 35 million tons [73]. - Demand: In 2026, the production progress of photovoltaic glass will slow down, and the float glass production will continue to decline, suppressing the demand for dense soda ash. The demand for light soda ash will increase. The total demand for soda ash will decrease by 4.8%, a net decrease of 177 million tons [73]. - Net Export: As the supply - demand imbalance of soda ash further intensifies in 2026, the price will remain at a low level, and the export is expected to increase to 257 million tons [74]. - Inventory: After some projects were put into operation in 2025, the high - cost supply will be suppressed at low prices, and the inventory will remain at a high level throughout the year [75]. Summary - The soda ash price in 2025 showed a downward trend due to the expansion of production capacity and weak demand. In 2026, the over - capacity situation will continue, and the price will continue to decline unless some high - cost production capacity is cleared. Attention should be paid to price rebounds after production decreases due to increased enterprise maintenance and cost changes caused by thermal coal price fluctuations [6][87]. - The soda ash industry profits were under pressure in 2025, and the overall profitability improvement was limited. In 2026, the profit rebound needs to wait for a substantial contraction in supply or a recovery in glass demand [27]. - The supply of soda ash increased in 2025, and it is expected to continue to increase in 2026. The demand for dense soda ash will decline, while the demand for light soda ash will increase. The net export will increase, and the inventory will remain at a high level [84][87].

Summary of Key Points from Conference Call Records Industry Overview - **Federal Reserve's Interest Rate Expectations**: The divergence in expectations regarding the Federal Reserve's interest rate cuts in December has increased, with dovish officials citing a weak labor market as support for cuts, while hawkish officials express concerns over inflation rebound, leading to increased policy uncertainty [1][3][4][5] - **Domestic Macro Economy**: The LPR remained unchanged in November, indicating that the central bank believes there is still room for monetary policy, but the marginal efficiency is declining, making further easing unlikely this year [1][7][8] Commodity Market Insights - **Black Commodities**: There is a significant divergence in the performance of black commodities. Coal and coke prices have dropped sharply, with coking coal down 9% and coke over 4%. In contrast, iron ore has shown relative strength, increasing by approximately 1.2% [1][9][12] - **Iron Ore Market**: Iron ore has performed better than other commodities recently, but with increased shipments and port arrivals, supply-demand conflicts may intensify, leading to potential price volatility in the short term [1][12] - **Precious Metals**: The precious metals market remains weak, with the gold-silver ratio hovering around 81. Factors such as internal divisions within the Federal Reserve and geopolitical tensions have limited upward momentum for gold [1][15] - **Oil Market**: The oil market is under pressure from a mid-term supply surplus, with IEA predicting continued oversupply in global oil markets this year and next, leading to a bearish outlook for oil prices [1][20] Specific Commodity Analysis - **Coking Coal and Coke**: The coking coal market is facing increased supply due to domestic production recovery and rising imports from Mongolia. The coke market is also under pressure, with limited price increases expected [1][13][14] - **Steel Market**: The rebar and hot-rolled coil markets are experiencing narrow fluctuations, with recent data showing improvements in both supply and demand, although overall market sentiment remains cautious [1][10][11] - **Nonferrous Metals**: The nonferrous metals market is generally weak, with copper prices expected to remain volatile but high. The aluminum market faces seasonal inventory increases, limiting upward price potential [1][17] - **New Energy Materials**: The polysilicon and industrial silicon markets are weak, while lithium carbonate prices have risen unexpectedly due to improved fundamentals, although risks of price declines remain [1][18][19] Additional Insights - **Market Sentiment**: The overall market sentiment is cautious due to mixed economic data and geopolitical uncertainties, impacting various commodity prices and investor strategies [1][6][17] - **Future Expectations**: The outlook for many commodities remains uncertain, with potential for volatility driven by supply-demand dynamics and macroeconomic factors [1][20][21][25]

有机硅行业交流及展望 20251126 摘要 2025 年 11 月，鲁西化工牵头行业协调会议，旨在通过限产缓解有机硅 单体产能过剩问题，初步决定 12 月 1 日起限产 30%，并可能根据市场 情况调整至 20%，同时设定价格上限为 15,000 元，通过流量计监控生 产，核查小组定期检查。 有机硅行业内公司成本差异显著，多数公司含税成本约 11,000 元/吨， 恒盛硅业因能源优势成本低于 10,000 元/吨，部分国企成本高达 13,000 元/吨，12,000 元/吨售价对部分企业仍可能亏损。 有机硅技术成熟，但为避免新资本涌入导致供需失衡，会议强调控制价 格上涨幅度以维持市场稳定，且行业内企业达成共识，未来三至五年内 不进行大规模扩建。 全球有机硅行业开工率普遍在 75%-85%之间，欧洲因能源成本高企开 工率下降，美国陶瓷计划 2026 年关闭英国工厂，该工厂占全球约 5.2%的市场份额，国外整体开工率不到 80%。 国内 DMC（甲基氯化物）2025 年实际增速为 4.2%，远低于去年的 16.7%，主要受出口影响，并非市场普遍认为的 15%高速增长。 Q&A 近期有机硅行业会议的背景和主要内容 ...

目前，自主品牌接手合资品牌剩余产能的现象屡见不鲜。随着广汽菲克、广汽三菱、东风雷诺等合资车企相继退出市场，其工厂纷纷被自主品牌接手。广汽 三菱长沙工厂被广汽埃安接手，东风雷诺武汉工厂被岚图汽车接盘，东风日产云峰工厂也开始生产岚图FREE。 然而，就整个行业而言，目前产能过剩问题依然严峻。工业和信息化部原副部长苏波指出，现有燃油车产能至少3000多万辆，新能源车已建成的2000多万辆 产能大多为新建，油电转换仅消化了200万-300万辆的燃油车产能，这意味着仅新能源汽车就有1700万辆产能未被充分利用。 因此，从"增量扩张"转向"存量优化"是汽车行业未来的必然路径。而随着长安汽车接手了北京现代重庆工厂，深蓝汽车又将得到怎样的业绩提升，GPLP犀 牛财经也将继续关注。 近日，长安汽车接手了北京现代重庆工厂，并将其改为了深蓝汽车生产线。 公开资料显示，北京现代重庆工厂于2015年开工建设，2017年8月建成投产，总投资为77亿元，年产能30万辆。然而，因多种原因，其于2021年12月停工。 2023年8月11日首次挂牌出售，转让底价为36.8亿元，却无人问津。此后两次降价，最终在2023年底以16.2亿元，不到首次 ...

Group 1: Industry Overview - The petrochemical industry in Asia is facing overcapacity and weak demand, leading to declining profit margins and operational losses [1][3] - Companies are compelled to consider restructuring and consolidation as a necessary response to current challenges [1][3] Group 2: Company Actions - South Korean companies have agreed to reduce naphtha cracker capacity by up to 25%, with ongoing negotiations for business restructuring [1] - HD Hyundai Chemical and Lotte Chemical are finalizing plans to integrate their naphtha cracker operations into a joint venture to cut ethylene production [1] - Some companies, like Lotte Chemical, are planning to transition from basic chemicals to specialty chemicals [1] Group 3: Market Predictions - The global petrochemical market is not expected to recover in the short term, necessitating difficult decisions and adjustments in scale by companies [1] - The International Monetary Fund (IMF) forecasts a decline in economic growth rates for G20 countries, which may further impact demand for petrochemical products [2] Group 4: Challenges and Risks - Trade barriers, including U.S. tariffs and geopolitical tensions, are contributing to uncertainty in the market, affecting exports from countries like India [2] - The ongoing expansion of global petrochemical capacity from 2025 to 2026 is not favorable for companies, as demand remains weak in most economies [3] - Companies are urged to shut down outdated assets and rationalize operations before any potential recovery in demand can occur [3]