Nowadays, we should focus more on timing for making money, with value as a supplement, and observe the global economic situation 👇
1. Global economic growth is slowing and is unbalanced.
After 2023, the momentum for global economic growth continues to decline. Although the global supply chain is gradually recovering, the production climate is gradually falling back, and the role of domestic demand in driving the economy is weakening. Regionally, the growth pattern mainly shows 'strong in the U.S. and Japan, weak in Europe and emerging economies in the Asia-Pacific.' Looking ahead, the world economy is expected to grow slowly over the next five years, and the entire global economy is in a state of extreme uncertainty and fragility.
2. The politicization of international trade relations has slowed global trade growth.
In recent years, global trade has been heavily colored by politics. Certain developed economies in the West are increasingly eager to view economic relations between countries from the perspectives of geopolitical strategy and national security, promoting economic security threats in both domestic and international arenas. The intensification of great power competition has become a long-term trend, and some countries will continuously adopt a series of trade restrictions to protect their domestic markets. This tendency towards protectionism has made the trade environment more complex and uncertain, exacerbating the risks of global trade friction and hindering the development of global trade.
3. Strong inflation resilience, high interest rates may exceed expectations.
Factors unfavorable to supply such as government intervention in the economy, frequent geopolitical conflicts, and deglobalization are increasing. The Federal Reserve's room to cut interest rates will be relatively small in the short term, which means that the duration of this round of inflation will be longer. High inflation corresponds with high interest rates, putting immense pressure on the global economy. As global financial conditions tighten and trade growth weakens, the impact of declining confidence among businesses and consumers will become increasingly evident, and global economic growth will face significant uncertainty.
4. Global debt has reached a new high, and a crisis is brewing.
The Institute of International Finance released a report (Global Debt Monitor) stating that in 2023, global debt surged by more than $15 trillion, reaching a historic high of $313 trillion. 55% of the increase comes from developed economies in Europe and the U.S., and the ratio of global debt to global GDP has exceeded 336%. Among them, U.S. debt has surpassed $34 trillion, with the debt-to-GDP ratio exceeding 120%, and this is not the end. The U.S. is very likely to enter a vicious cycle of 'borrowing to pay off debt, and paying off debt by borrowing,' making it even more difficult to resolve the debt crisis.
Do a good job in profitability and risk control, such as focusing on odds in strong markets and relaxing drawdown tolerance, while emphasizing win rates in weak non-unilateral markets and tightening drawdown tolerance, and getting used to maintaining a cash position as a norm.