This weekend has brought a series of positive developments both domestically and internationally. These developments are considered favorable news for those who are optimistic about asset prices and willing to invest, while they may be less favorable for those keeping funds idle in banks without investment activities.
**Development One: Trump Conducts Large-Scale Fed Chairman Selection Process**
Although current Fed Chairman Powell's term doesn't end until May next year, Trump has already repeatedly demanded his resignation and compiled negative material against him, preparing for potential impeachment proceedings. Trump has also announced the dismissal of a Fed Board member nominated during the Biden administration, with the dismissed member filing a lawsuit against Trump in response.
An intense political struggle is underway regarding key Fed personnel and interest rate cuts. Trump believes that without resolving personnel issues and achieving rapid rate cuts, the Republican Party will face defeat in next year's November midterm elections.
By conducting this grand selection process early to determine the next Fed Chairman candidate (final appointment requires Senate confirmation), Trump aims to psychologically pressure current Chairman Powell and several board members who oppose rate cuts.
The selection process interviewed 11 candidates, with Trump announcing the top three finalists: Waller, Walsh, and Hassett. The first two previously served as Fed board members, while the third served as a White House economist.
**Development Two: US Employment Data Shows "Weakness," Supporting Rapid Rate Cuts**
The Fed's decisions on rate hikes or cuts primarily depend on two key indicators: inflation rate and unemployment rate, both of which are managed by the Bureau of Labor Statistics under the US Department of Labor.
Fed Chairman Powell has consistently refused to cut rates, mainly because the inflation rate hasn't fallen below 2%. Meanwhile, unemployment exceeding 4% provides justification for rate cuts, though Powell prefers to observe several more months of data.
Unable to influence Powell directly, Trump has targeted the department responsible for releasing inflation and employment data. He criticized the previous Bureau of Labor Statistics director for allegedly manipulating data to favor Biden and replaced her with his own appointee.
The newly released employment data strongly supports rate cuts: In August, US non-farm payrolls increased by only 22,000 jobs, far below the expected 75,000, while the unemployment rate rebounded to 4.3%.
This news caused US 10-year Treasury yields to drop significantly, indicating strong market expectations for rate cuts. Fed rate cuts benefit gold prices, with gold reaching historic highs overnight.
Reports indicate that domestic gold jewelry prices rose today, with Chow Sang Sang's pure gold jewelry priced at 1,068 yuan per gram, up 9 yuan from the previous day's 1,059 yuan per gram.
Markets believe the "disappointing" employment data will prompt the Fed to cut rates rapidly. There's speculation that the rate cut announced early morning on September 18 (Beijing time) could be 50 basis points rather than just 25 basis points. Even if it remains at 25 basis points, there could be two or even three additional cuts this year.
These two developments constitute positive news for China's stock market, real estate market, and real economy. The Fed's renewed rate cutting cycle and accelerated pace provide China with more room for rate cuts.
**Development Three: China's CSRC Further Reduces Fund Fees, Encouraging Capital Migration to Markets**
The CSRC has revised the "Administrative Provisions on Sales Fees of Open-end Securities Investment Funds" and is seeking public comments. Key provisions include:
Reduced subscription and purchase fee rates, with upper limits for equity funds, hybrid funds, and bond funds adjusted down to 0.8%, 0.5%, and 0.3% respectively.
With this, public fund fee reforms have progressed through three stages, cumulatively saving investors over 50 billion yuan annually.
Experience from developed countries shows that as financial assets comprise an increasing proportion of household wealth allocation, direct retail stock trading decreases while people gradually adopt fund participation in stock markets, allowing professional individuals and institutions to manage their investments.
Reducing fund fees and improving investment efficiency and credibility represents an important future direction. Residential savings deposits are indeed showing signs of migration, flowing from banks into stock markets.
**Development Four: Shenzhen Releases New Real Estate Policies, Further Relaxing Purchase Restrictions**
Key points of the new policies include:
1. Yantian District and Dapeng New Area have completely eliminated purchase restrictions, allowing residents from anywhere to buy freely regardless of Shenzhen social insurance status.
2. For Luohu District, Baoan District (excluding Xin'an Subdistrict), Longgang District, Longhua District, Pingshan District, and Guangming District, purchase restrictions have been completely lifted for Shenzhen residents and those with one year of Shenzren social insurance.
3. Non-residents without social insurance can purchase up to 2 commercial residential units in Luohu District, Baoan District (excluding Xin'an Subdistrict), Longgang District, Longhua District, Pingshan District, and Guangming District.
4. Shenzhen's core area definition has changed, with Luohu District and Baoan District's Xixiang Subdistrict no longer included. The newly defined core area has shrunk to Futian District, Nanshan District, and Baoan's Xin'an Subdistrict.
5. Single individuals are subject to the same purchase restriction policies as families, meaning registered single residents can purchase 2 units in core areas.
Additionally, down payment ratios and interest rates for second homes have been reduced (no longer distinguishing between first and second homes), and policies for enterprise and institutional commercial housing purchases have been optimized.
While Shenzhen, like Beijing and Shanghai, hasn't completely eliminated purchase restrictions, Shenzhen's relaxation measures generally exceed those of Beijing and Shanghai.
Shenzhen has also published draft revisions of the "Shenzhen Housing Provident Fund Management Measures" and "Shenzhen Housing Provident Fund Withdrawal Management Regulations" for public comment, proposing six new withdrawal categories to support employee housing consumption, including down payment withdrawals, tax payment withdrawals, non-local property loan repayment withdrawals, relocation area expansion withdrawals, and old residential area renovation withdrawals.
Shenzhen's new real estate policies help release local housing market demand and attract non-residents to invest in Shenzhen property, benefiting not only Shenzhen's real estate market but also constituting positive news for the national real estate market.