Source: Brokerage China Author: Qu Hongyan Recently, China Yangtze Power hit a historical high and once again showed the slow bull stock trend of "tripling in ten years". The slow bull market has left behind many passers-by and brought good returns to the steadfast investors. It is "rare for those who triple in one year to be like carp jumping over the dragon gate, while those who double in three years are few and far between." On the other end of the investment world, however, violent collapses are also deafening, with many financial products suspected of "Ponzi schemes" ceasing payments, leaving investors with no hope of recovering their investments. Both positive and negative cases illustrate the importance of forming a suitable mentality towards money in one's lifetime; otherwise, sooner or later, you will divorce yourself from your money. "I call this the money mind, a person's IQ can reach 120, 140, or even higher levels, and perhaps some people's minds are good at doing one thing, while others are good at doing another. They can do things that most ordinary people can't do. But I know some very smart people who make very foolish decisions because they lack the money mind." Buffett once said so. The so-called money mind refers to believing in common sense, believing in compound interest, being cautious and rational, thinking independently, prioritizing security over return, not dealing with people with questionable character, not easily guaranteeing for others, not believing in windfall profits, and not trying to cross legal norms for extra benefits. In today's world of ubiquitous information, everyone's wealth may become the "prey" of those with ulterior motives. Only with the money mind, can one form good behavior habits and shield oneself from separating from one's wealth. Do not entrust your wealth easily. Wealth is easy to lose but hard to accumulate, and trust is a vital reason leading to the rapid loss of wealth. "Do not allow anyone else to manage your business unless you can watch their every move closely and understand their behavior; or you have strong reasons to believe in their character and ability. For investors, this criterion determines when you can let someone else make investment decisions for you." Graham's criterion written eighty years ago is so clear. Almost all the investors who lost their wealth in the financial products have violated the above two criteria. They did not have the ability to closely supervise the whereabouts of their funds, nor did they have sufficient reasons to believe in the character of the product issuers. They easily invested their own wealth solely based on others' glib tongue and a piece of commitment paper. They did not act as gatekeepers of their own wealth and ended up with nothing left even if the government punished the wrongdoers. "An ounce of prevention is worth a pound of cure." This is a phrase Munger often says. Destiny must be in one's own hands, and investors with a suitable money mind will try their best to find suspicious points in their investments to protect the safety of their principal. For example, whether the manager is trustworthy, whether the underlying assets are profitable, whether oneself can timely monitor the risks in the investment process, and whether the sales staff is obtaining large commissions. As long as any unreliable signs are found, these investors firmly will not invest their money. Do not desire to get rich quick. As in the capital market and anywhere else, making money is not easy, and desiring to get rich quick will lead to quick loss of wealth. In the capital market, the desire to get rich quickly often leads to investors over-allocating specific stocks, industries, or assets at the worst time. For example, buying high-risk stocks that can gain huge returns once an adventure succeeds, but the chance of success is very small, also known as "whispering stocks" by legendary fund manager Peter Lynch. "They often tell investors a story with explosive effects. These 'whispering stocks' have a hypnotic effect on people, and it is easy for you to believe that the story the company tells has an emotional appeal that can easily confuse you." This is like hearing a very tempting "sizzling" sound, making you salivate, but you did not notice that there is no steak on the grill. In the eyes of investors who lack the money mind, stable yield provided by blue chips such as China Yangtze Power cannot meet their demands. However, historical experience clearly shows that buying stocks lacking in safety solely based on imagined high yields is unwise. The long-term average investment return of general stocks is 9%-10%, which is also the average investment return of stock indexes in history, a benchmark to measure one's investment performance and the benchmark to measure fund investment performance.

Author: Shi Qian. Will this be the arrival of the "real wolf"? The consumption tax rumors suddenly spread in various investment groups yesterday after the close of trading. There are reports that a trillion-level consumption tax reform will be approaching, and luxury goods and high-end services may be the first to test. As of the close of trading this morning, consumer stocks suddenly rebounded collectively, and retail and duty-free areas led the rise. Among them,

At the opening this morning Beijing time, the US dollar index, which surged last Friday, suddenly plummeted. At the same time, the offshore renminbi skyrocketed nearly 300 points. The direction of the US dollar affects global markets. The South Korean stock market and the Australian stock market both opened higher. So, what exactly happened?

Analysts believe that this may be closely related to the US election. In the previous month, Trump trades were prevalent, leading to a surge in Trump-related media technology companies, the US dollar index, and cryptocurrencies. However, with the latest poll and voting data updates, Trump trades have experienced a certain degree of reversal, causing significant declines in previously rising assets. Uncertainty surrounding the US election has increased significantly.

The US dollar suddenly plummeted.

In early trading today, the US dollar index suddenly plunged by 0.34%, breaking below 104. Last Friday, in a situation where non-farm data fell significantly below expectations, the index also experienced a substantial rise.

Analysts believe that this may be closely related to the US election. In the previous month, Trump trades were prevalent, leading to a surge in Trump-related media technology companies, the US dollar index, and cryptocurrencies. However, recently, these assets have all plummeted. At the same time, the situation for Harris is once again bullish.

According to the results released by an Iowa state public opinion poll on Saturday local time, Democratic presidential candidate Kamala Harris surpassed Republican Donald Trump in a new poll in Iowa. In a state where Trump easily won in 2016 and 2020, the key to the reversal may lie with female voters. Harris leads Trump in Iowa by 47% to 44%, while Iowa has been a strong supporter of Republicans in recent years.

Compared to leading by 4 percentage points in the September poll in Iowa, this is a turnaround.

Furthermore, on November 3 local time, according to a joint poll conducted by The New York Times and Siena College, in the 2024 U.S. elections, in 7 key "swing states", Vice President of the United States and Democratic presidential candidate Harris leads the former President of the United States and Republican presidential candidate Trump by a slight margin of 48% to 47% overall.

As of November 2, 67 million ballots have been cast, with Democratic registered voters accounting for 41% and Republicans 40%. In key swing states, Pennsylvania, Michigan, and Wisconsin have a higher proportion of Democratic registered voters, with Pennsylvania at 57%, leading by 24 points. Early voting is at a disadvantage, and Trump's poll numbers and chances of winning are declining.

On the other hand, the expectation of a 25 basis points rate cut by the Fed in November is back on the table. Following the release of the U.S. October employment report, the market predicts a 99.7% probability of a 25 basis points rate cut by the Fed at the November 7 meeting, up from 93.1% before the non-farm payroll report. Guosen Securities research report pointed out that the substantial decrease in new jobs in October in the United States, but the unemployment rate remains low, mainly due to hurricane weather and strike disruptions. High-frequency indicators show a significant improvement in employment in November. The Fed is highly likely to cut rates by 25bp in November and December.

Variables in the election

This week, the biggest international event is undoubtedly the U.S. election. For the capital markets, it is also full of great variables. Trump's election may have a certain impact on the current international order, with a higher possibility of re-inflation in the United States. If Harris is elected, the current order should be maintained, to a certain extent inheriting Biden's policies.

Since the end of October, Trump's campaign team has been continuously affected by negative factors, including controversial statements, suspected manipulation of the gambling market, and a disadvantage in early voting. Trump's probability of winning has dropped from an increase to a decline, reaching 52% as of November 2, while Harris's chances of winning have risen to 52%, and both sides' chances of winning are once again equal.

SWHY stated that due to early voting, Trump is currently at a disadvantage. However, in the last two elections, early voting accuracy in predicting the election results was only 38% and 50%. Additionally, this year in the United States, early voting voters accounted for only about 33%, with nearly 70% of voters yet to vote. Early voting only counts the registered party of voters, but does not represent the actual voting results, with each party having about 5% of voters voting for the other party.

Compared to 2020, this year, the Republican Party's disadvantage in the early voting stage has narrowed slightly, with the election still evenly matched and significant uncertainties. In 2020, Democratic registered voters accounted for 43%, leading the Republican Party by 6 percentage points, with a lead in early voting in Pennsylvania as high as 45 points. However, in 2024, the Democratic Party's lead has been reduced to 1 point, significantly narrowing the gap between the two parties.

They believe that if Trump unexpectedly loses, there is a need to be vigilant against a "Capitol Hill Impact 2.0." If Harris wins, attention should be paid to the possibility of a repetition of the Capitol Hill impact in January 2021. In the short term, political conflicts may weaken confidence and expectations, and if combined with the debt ceiling issue, it may temporarily affect U.S. economic growth, leading to a reversal of the previous " Trump trade." If the election results are disputed, candidates may request a recount, or prolong the market's "chaotic" state, increasing volatility. It is expected that the election results can be known from Beijing time noon on November 6 to the early morning of November 7. However, there are also uncertainty factors: first, areas like California still allow mail-in ballots to arrive after Election Day; second, if the election results are disputed, candidates can request a recount.

Editor/Rocky