DooPrime：2020Will the annual meeting encounter a global financial crisis?

If the COVID-19 continues to ferment, it is bound to have a significant impact on the global economy, and the possibility of a financial crisis cannot be ruled out. What is even more concerning is that after years of monetary easing, the monetary policy space of various countries has significantly narrowed, which may be a greater risk for investors.

As2020The first "black swan" in, the COVID-19's sudden attack cast more shadow on the originally weak global economic growth. Has the global stock market entered a bear market as a result? Is a new round of global financial crisis already brewing? Interface News interviewed multiple economists and analysts on hot topics of market concern.
Economists believe that if the COVID-19 epidemic continues to ferment, it will have a significant impact on the global economy, and the possibility of a financial crisis cannot be ruled out. What is even more concerning is that after years of monetary easing, the monetary policy space of various countries has significantly narrowed, which may be a greater risk for investors.
In the short term, the pandemic and the failure of Middle East oil price negotiations have driven up global risk aversion. As far as the US stock market itself is concerned, the rise in the past two years has actually come more from the improvement of valuation level, rather than the improvement of profitability. This kind of upward trend is not sustainable in itself, and a downward trend only requires a trigger point. This epidemic andcrude oilPrice fluctuations provide everyone with a reason for the decline of US stocks.
However, deeper reasons may still be concerns in the market about the risk of a global economic recession and concerns that global central bank policy reserves may have been depleted when the risk truly looms. The global economy has already recovered10For many years, the risk of recession has been accumulating. During this process, the policy space of global central banks has continued to narrow. This is a risk for investors.
In addition, the Federal Reserve's interest rate cuts50One basis point, which makes the market feel that the situation may be worse than expected, may also be a factor driving the sharp rise in short-term hedging sentiment.
The profit growth of non-financial enterprises in the United States2014After the year, it has almost come to a standstill, and the rise of the US stock market mainly depends on valuation improvement and the issuance of debt instruments by companies for repurchase. However, the risk premium in the high-yield bond market has skyrocketed due to risk aversion, hindering corporate debt financing. The increase of corporate credit risk and the sharp fall of US stocks will further deepen investors' pursuit of safe assets, making investors place more chips on safe assets such as US treasury bond bonds, further squeezing US stocks.
In the short term, there may be an overshoot in the US stock market, and the global market will not enter a bear market right now. It is expected that a new round of monetary easing may emerge globally in the near future, supporting a rebound in capital markets.
However, in the medium to long term, as the global economic recovery is coming to an end, the decline in financial markets is a major trend. Due to the fragility of market sentiment during this stage, there may be more so-called skyrocketing and plummeting during the process.
After the sharp decline, the valuation of US stocks has declined, and a significant decrease in interest rates is conducive to boosting the valuation of US stocks. The fundamentals currently do not support a significant downward trend in the financial market. From the perspective of short-term liquidity shocks, there is no trend of tightening liquidity. Therefore, the current financial market trend is more like a short-term adjustment. But whether it will transform into a medium to long term bear market depends on the degree to which consumer spending and the stability of financial institutions are affected after short-term adjustments.
2020The global economy has significantly weakened in, and it is not ruled out that there may be a recession, but whether a financial crisis will occur depends on the adjustment of the capital market. If the capital market continues to decline significantly, the possibility of a financial crisis cannot be ruled out due to the current dependence of financial institutions on the capital market and residents' wealth on stock assets.
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