Biden submitted 6 trillion US dollars “money throwing plan”, the market is quietly starting

Last Friday, US President Biden proposed a 6 trillion U.S. dollar budget. Once the budget is passed, the intensity of the release will be no less than this year.

It seems that the US government has no intention to suppress the release of water at all. This way of drinking poison to quench thirst has become addictive.

As soon as the news came out, US stocks rose sharply. In addition, the precious metals market is also quietly starting. In my opinion, a very important indicator is the trend of gold.

In this large release, gold began a major adjustment after it hit a record high of nearly US$2,100 in August last year, and it fell below US$1,700 in March of this year. There is a voice in the investment market that gold has lost its safe-haven and anti-inflation properties and that cryptocurrencies such as Bitcoin are quietly replacing gold. But since March, gold has begun to slowly rise again, and this rise has also begun to accelerate recently.

If we combine the reaction of US stocks, we can see that this shows that funds in various markets are beginning to see a fact that may be increasingly difficult to refute: that is, the US government’s release of water may not be stopped.

Recently, Fed officials have expressed different voices on different occasions. This has caused the market to speculate whether the current loose policy will change? But considering the new budget proposed by the President of the United States and his direct naming on more and more occasions to compete with China’s heavy investment in infrastructure, scientific research, and manufacturing, I’m afraid that on the whole, loose policies are very strong. It is difficult to change in the short term; even if there is a change, it may be that monetary policy has been tightened at most, but fiscal policy continues to be loose, and the combined effect of the two is still loose.

Since it is loose, the U.S. dollar must continue to look for various investment channels.

I don’t know if you have noticed the two recent trends. One is that the exchange rate of RMB against the US dollar continues to rise, and the other is that A-shares have quietly reached 3,600 points.

As of the time of writing, the U.S. dollar against the renminbi has reached 6.37. Many people believe that this is a hedging strategy launched by the country to counter the printing of U.S. dollars — let the renminbi appreciate. On the one hand, it protects our country from being cut leek, and on the other hand, it transfers inflationary pressures back to the United States. Because at this moment, only our country in the world can manage the epidemic well and ensure the normal operation of the manufacturing industry. This is the capital for the continuous appreciation of the renminbi.

In my opinion, the continuous appreciation of the renminbi has another important reason besides the above reasons: that is, foreign capital is also pouring into the domestic market to find investment targets. The most obvious is that the A shares scolded by investors have quietly stood up to 3,600 points. After the A-shares stood at the high of 3,731 points in the current round of market in February this year, they began to go all the way down and hovered between 3,300 and 3,400 for nearly 3 months, and then began to accelerate their rise in the near future, standing above 3,600. point.

Foreign investors are increasing their positions in A shares by a large margin.

Therefore, regardless of the recent trends in the U.S. stocks, gold, renminbi, A-shares and other markets, I think the market is quietly starting in an all-round way and is beginning to respond to a new round of releases. Although everyone knows that this game is unsustainable and will cause disasters, before the game is over, everyone can only do their best to find targets in various markets and protect their assets.

Then talk about digital currency, I think it is even more impossible to miss this game. Even investment targets with serious bubbles like U.S. stocks are flooded so fiercely by the flood, how can digital currency be let go by capital?

The problem now is not whether there is a bubble in the market, but that funds that are close to zero cost have to do everything possible to find a way out and hungry for returns.

I believe even more that for digital currencies, the second half is beginning. But will it come so fast? I don’t think it is necessary. Judging from the trend of gold and A-shares this year, the start of these two markets has gone through nearly 3 months or more of bottoming before they have the current uptrend, so the digital currency market may also take some time. After digesting the emotions in the early stage, he will pack up and show his glory again.