SMM1, April 4: if you want to say what is the most worthwhile asset to invest in right now, it is gold. At present, gold has reached a new high in nearly half a year. Today, the market once broke through the 1300 integer mark. In less than two months, gold has soared by US $100. The performance of other commodities, stock markets, futures markets and bond markets has not been satisfactory, especially in US stocks, where the sudden U-turn of the K-line since October has taken the whole US stock market beyond recognition.
In addition, it was announced yesterday that the PMI of the US ISM manufacturing industry in December was only 54.1, significantly lower than the previous value of 59.3. The monthly decline in the ISM manufacturing activity index was the biggest since October 2008 and is now the lowest since November 2016. The ISM manufacturing new orders index fell by the most since January 2014 to its lowest level since August 2016, proving once again that trade frictions have dealt a huge blow to the US manufacturing industry and have had a huge impact on the confidence of US manufacturers. The consequences of high tariffs are emerging, with the fall of the dollar, the fall of the stock market, and the fall of US bonds coinciding with what is happening to the US economy. It is clear that the US economy can no longer stay out of it.
On the Treasury side, the two-year yield has fallen below 2.4%, the lowest since May 30, 2018, unchanged from the federal funds rate for the first time since 2008, and the yields on three-and five-year Treasuries have fallen below 2.4%. The yield on the 10-year note fell more than 10 basis points to 2.56 per cent, more than 50 per cent from its 2018 high and the lowest since January 25, 2018. At present, the yield curves of one-year / two-year, one-year / five-year, two-year / five-year and five-year / ten-year US Treasuries are all upside down. On the surface of the data, the confidence of the American people in the future of the US economy has reached a freezing point. Historically, Do not rule out the risk of a potential economic crisis. Markets have begun to expect the Fed to cut interest rates in 2019, but Kaplan said in an interview on Thursday that it was not prepared to change the pace of the contraction, did not expect to cut interest rates, and inflation did not disappear. If the high-pressure trade friction between China and the United States continues this year, it will bring even greater disaster to the United States.
With the stock market plummeting and the bond market plummeting, the United States should consider how to solve the huge challenges facing the US economy. If the US economic problems are not handled properly, the global economy will be even worse.
