Short-sellers lost 20 million in January

The worst this year may not be the high-ranking entry into Rendong Holdings, but the short-selling commodities.
someone said:
In a month, empty PP lost more than 3 million, empty glass lost more than 3 million, empty steam coal lost more than 3 million, blank sugar lost more than 2 million, anyway, back and forth 20 million, no more~
Picture In the last two months of 2020, commodities will rise again. Iron ore and thermal coal are leading the rise. Industrial metals are behind, chemical products are rising, agricultural products are not to be outdone, and precious metals are rising.
Looking back at the beginning of the epidemic this year, the volatility of bulk commodities was: more than 30% of the varieties that fell 30%.
No one would have imagined that after the second half of the year, the commodity market will be up 30% and more than 60% of the variety. Together, Dalio and Buffett dare not predict this turning point.
Pictures are singing from Wall Street to Lujiazui
Goldman Sachs released its investment forecast for 2021 a month ago. It believes that commodities may usher in a bull market next year. China Merchants Securities also issued an annual report a few days ago. It directly believes that under the impetus of the Fed’s unlimited quantitative easing monetary policy, the US dollar will start this year Entering a weak cycle of nearly 9 years, so commodities are expected to strengthen.
Judging by this, starting from 2020, the 9-year commodity bull market is coming.
The analysts can also see signs of this. Let’s take a look at it by sector.
Due to the La Niña phenomenon, the production of agricultural products may be reduced in the future. For example, the current soybean planting progress in Brazil has been affected, and soybeans are likely to continue to rise. In addition, we have discussed many times before that the locust plagues that often linger between coming and not coming will also cause crop yields in Southeast Asia, Africa and other places. Therefore, the probability of agricultural products still has to go up.
Because of the recovery of the manufacturing industry, black products are expected to continue to rise. If vaccines become popular in the future, the global manufacturing industry will face a recovery, and the black products will probably rise again.
chart
The “Hurricane” of the Black Series in the fourth quarter. Image source: Guotai Junan
As for precious metals, the relationship between precious metals and the U.S. dollar is very strong. At present, the situation of “weak U.S. dollar” is constantly strengthening. Many institutions still feel that there is room for growth in gold, and even some institutions still call the price of 2500 US dollars per ounce for gold.
chart
Image source: Bank of China International
As for some basic metals and chemical products, in addition to raw materials, it also depends on the manpower of the mining country and the production capacity in the factories, but it does take time to recover the production capacity.
The picture turns out that everything has been predetermined
It is said that the relationship between supply and demand is a good friend of commodities. The rise of some commodities can be seen from the surface. The supply and demand increase, so prices increase.
For example, iron ore, copper, aluminum, several major mines in the world have reduced production due to shortage of manpower, and the resumption of production is about to resume. These commodities are increasing consumption as consumables, thus starting a journey of skyrocketing.
However, for some commodities, the demand side has not changed much, and the supply side has not changed as much as the mining industry, so there are some factors that follow the trend.
Why started to hype commodities? What is the fundamental logic of this wave of commodity price increases? Perhaps Father Fisher told us why as early as a hundred years ago.
First look at the Fisher formula: MV=PQ.
M is the total amount of money, V is the speed of money turnover, P is the price of commodities, and Q is the quantity of commodities.
Let me talk about the total amount of M currency. This year, central banks of various countries have begun to release watermark money, and the total amount of currency will definitely increase.
The speed of currency circulation did slow down at the beginning of the year due to the epidemic, but after a year, the rate of currency circulation theoretically did not change much from the previous year.
And the quantity of commodities on the right side of the equation will not change much in the short term. It is not mentioned before. Since the epidemic, the number of people working in mines has been reduced. It is not bad if the quantity is not reduced. This can only lead to an increase in the price P.
To put it bluntly, the water was too much during the crisis, and the money was everywhere. Many people felt that “you can’t hold money in troubled times and you have to choose “P”. Finally, everyone started to drive up P, which caused some commodity prices to be speculated inexplicably.
So, is it good for commodities to usher in a bull market?
Let me talk about the conclusion of this question first, good or bad.
The good thing is for investors, of course, they will gain a lot in this bull market cycle.
However, global central banks have continued to “print money” on a large scale after 2008, and have applied this extreme monetary policy of “dropping money” to the extreme.
Currency needs to be supported by physical commodities, and prolonged monetary policy is not a long-term solution. Although the market is worried that such crazy waterproofing will become “drinking poison to quench thirst”, the central banks of European and American countries just smiled and told everyone “do not 6”.
What can pictures bring to China?
Many people are more concerned about what the bull market in commodities can bring to China?
1. Buy China globally
There has been news in the past few days that it is difficult to find a container of exported containers. There are two main reasons for the lack of containers: First, the epidemic in Europe and the United States is more serious, and empty containers cannot be shipped back in time. Second, as a region with better epidemic control, China took the lead in resuming work and production, and the phenomenon of global buying of China appeared. The volume of export freight continues to increase. As a result, the domestic demand for containers has increased and the supply has decreased. Now containers are not enough.
2. China’s commodity pricing power has been improved
In the increasingly financialized global commodity market, commodity pricing power actually exists not only among physical traders, but also in the hands of futures traders.
There was a strange phenomenon in the previous market that “whatever China buys, the international market will rise; what China sells, the international market will fall”.
Therefore, the fundamental way to increase the right to speak in pricing is to vigorously develop China’s commodity futures market through the commodity bull market. For example, the participation of foreign investors in the futures market will increase steadily in 2020, and Fang Xinghai, vice chairman of the China Securities Regulatory Commission, also recently stated that the pricing influence of my country’s important commodities has been improved.
From the perspective of historical opportunities. The release of global currencies after the 2008 subprime mortgage crisis led to the subsequent bull market in commodities; the loosening of China’s currency from 2014 to 2015 led to the black bull market from 2016 to 2017; after this year’s global central bank release, 2021 may be called “history Commodity bull market in transition”.

Leave a Reply

Leave a Reply

Your email address will not be published. Required fields are marked *

©Spark Global Limited Financial information & The content of the website comes from the Internet, and any infringement links will be deleted.