Page 9 - CCFA Journal - Sixth Issue

加中金融 宏观经济 MacroEcon

These are some of China’s current economic and financial risks. retail trading interest. We started to see tremendous growth
Basically, bankruptcies and defaults are something we are in the options business in both Canada and the U.S. In the US,
keeping an eye on right now, especially on the real estate side, quite frankly, the absence of spectator sports may have made
how rapidly real estate default rates are climbing as a share of a huge difference, because there were no sports to gamble on.
total defaults in China. Also, there's a banking system concern I think a lot of individual investors realized that the payoff
in China. The bigger banks like ICBC, Bank of China are all fine structure is very similar between a sporting bet and options
due to the immense level of personal deposits. However, the speculation. If I put down $2 on a horse, and it goes off at four
smaller banks, such as the rural commercial banks and the city to one odds and most likely I'm going to lose my $2 on that bet,
commercial banks, has a lot of frailty in the system with ~10% but if it pays off, I get it. So that's the analogy if I take spectator
under high stress/risk. The PBOC are watching these banks sports and news odds. What became very popular was call
carefully and it's something that everybody should be thinking options, and because the markets were moving relentlessly
about especially if you're actually an investor in China. Liquid higher a lot of stimulus money flowed into the markets. What
stress means that there are threats of liquidity shock, so it's you started to see was that, if I buy a call for $1, and this stock
important to watch Chinese liquidity levels right now. On asset goes where I think it's going to go, I might make four or five.
price distortions, China's capital account is opening for inflows Odds are you will not because most options expire worthless,
but it's still shut tight on the outbound side so it means that but it's the same mentality to a lot of people. I think enough
domestic money has a hard time getting out. So if you got a lot people realized that, unlike sporting events, if all of us bet on
of money chasing a limited number of investments, with a lot one team to win in an upcoming game, say we all put our
of people currently avoiding real estate, this increases the money on Washington – who is an underdog – in a game
potential for asset price distortions and speculation in between the Dallas Cowboys and the Washington Redskins, it
commodities and other goods. The last one is weak global will make Washington more likely to win the game. That's what
demand. Local demand has held up very well for China, but we saw in the mean stock raise, was that enough people
that demand may begin to ease as other economies begin to started buying stock and call options in some of these names,
come back online. I'm not convinced on this thesis right now AMC being a popular meme stock. Blackberry was counted as
because I think China's performed extremely well on the trade a participant in the main race. Now, there's only a finite
side, and I expect China to continue to outperform here for the amount of time that works and that came to a natural end. This
next couple of quarters. brings us to where we are now, where markets are at or near
all time highs depending on your index, with two years of
Retail Investing & Equity Market Outlook in 2022
phenomenal growth of individual investor activity.
I'm very excited to talk to everybody about retail investment in
the equity market outlook etc. I can't give actual 当下中国当前的一些经济和金融风险，包括破产和违约，
recommendations so I can't say where the TSX60 or the 是我们现在关注的问题。特别是在房地产方面。中国房
S&P500 is going to be at some level, so I will have to speak in 地产违约率在违约总额中所占的比例正在迅速攀升。此
generalities, but not so general so that it will be useful. 外，中国的银行体系也令人担忧。中国工商银行(ICBC)、
中国银行(Bank of China)等规模较大的银行都安然无恙，
Let's look at where we are in 2021, which is built on the 因为它们拥有庞大的个人存款水平。然而较小的银行，
exceptional growth of 2020. For equity and options business, 如农村商业银行和城市商业银行，在系统中有很多的弱
and just individual investing across the border, this has been a 点，约 10%的高压力/风险。中国人民银行正在密切关注
huge leap forward. I can't remember any time like this in my 这些银行，这是每个人都应该考虑的事情，特别是如果
career, where we've had individual investors so engaged in the 你是中国的投资者，流动性压力意味着存在流动性冲击
market as we see them now, and the only example that I can
think of was in the late 90s. When we think about why we saw 的威胁，因此现在关注中国的流动性水平很重要。
that in the late 90s period, it was because of a huge 在资产价格扭曲的问题上，中国的资本账户正在向资本
democratization of investing made possible through web 流入开放，但对外依然紧闭，这意味着国内资金很难流
based trading, and that's when people were able to remove 出。因此，如果你用大量资金追逐数量有限的投资，而
the middleman from a lot of their day-to-day trading. 很多人目前都在回避房地产，这就增加了资产价格扭曲
Obviously, there are still professionals who help out at all levels. 和大宗商品和其他商品投机的可能性。最后一个原因是
We basically removed the need for people to call the broker, 全球需求疲软。中国的本地需求一直保持得很好，但随
who would then call the floor of the exchange for day-to-day
trading. That competition also drove down commissions, 着其他经济体开始复苏，这种需求可能会开始放缓。我
which was big. The third thing is the internet, which captivated 现在还不相信这一论点，因为我认为中国在贸易方面的
people. We had in the U.S. the ability of free commission 表现非常好，我预计未来几个季度中国在这方面的表现
trading. The options business was already growing 将继续优于美国。
dramatically, and then we started to see fractional shares 2022 年零售投资和股票市场展望
being offered in the US and in other places. That was a big step
forward, democratizing individual investing in a big way. 我很高兴能和大家谈谈股票市场前景方面的零售投资。
我不能给出实际的建议，所以我不能说 TSX60 或标准普尔
Then COVID hit, and it shocked the world markets. The central
banks around the world did what they needed to do, which 500 指数将在什么水平，所以我只能笼统地说。
was inserting liquidity into the marketplace, with many
governments started handing out stimulus cheques to
individuals. People found themselves with little else to do, but
the internet was keeping them connected to the rest of the
world. So this became the perfect storm for an explosion in

CCFA JOURNAL OF FINANCE February 2022
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