There Are Two Different Views On The Impact Of Aging On Interest Rates.

China is now entering this stage. The decline of the investment center is still very obvious. In the 10 years from 02 to 12 years, our investment growth rate is 25% on average. This year only about 10%. In the long run, the investment growth rate can be maintained 10%. It is already very difficult. Considering the 7% GDP growth rate, if the investment growth rate can still maintain 10%, the proportion of investment in GDP is still high.

Xu Xiaoqing, chief economist of Tun and information management, said he was cautious about the continued rise in the bond market in the short term.

He believes that the risk lies in the market's correction of pessimistic economic expectations.

Of course, if the rate of return can rise obviously, it will be a better buying opportunity.

In the long run, China's bonds are in the bull market cycle, but at the same time, they are faced with problems such as aging and high leverage.

Xu Xiaoqing, a star analyst of CICC, has been selected as the best bond analyst of new wealth for many years and is now the director of macro strategy of don & amp; Investment Limited.

The specific contents of this speech are as follows:

Let's start with a long-term view that China's bonds are in the bull market cycle. This view has not changed.

I can sum up two basic characteristics of China's economy in six words, one aging and one highly leveraged.

The central interest rate of all economies with these two characteristics is decreasing.

Let's look at ageing first.

In 70s, Japan, South Korea in 90s, including today's Europe, all had similar situations.

From the dependency ratio (without working ability of the population and having

From the inflection point of population ratio, China has actually stepped into aging since 2010.

One view is that aging will lead to a decline in savings rate, savings rate represents the supply of funds, reduced supply means that interest rates will rise.

This is true in the early days of aging. China's savings rate probably started from 10 years ago.

So although the economic growth rate has been declining in the past 11-13 years, interest rates are indeed rising. We will be used to explain from the perspective of interest rate marketization, which is essentially the result of the decline in the savings rate.

From 09 years, the downward movement of the central nervous system is another manifestation of the decline in savings rate.

During this period, the supply of funds was relatively reduced, and the demand for capital remained strong.

Another view is that aging will lead to a decline in investment rate, investment rate represents the demand for funds, reduced demand means that interest rates will decline.

This is actually what happened in the later stage of aging.

Eventually, the rate of decline will be faster than that of the savings rate.

Since the ultimate goal of investment is to require people to consume, the demand for investment will naturally decrease as the population decreases, typically for real estate demand.

In addition, in the allocation of economic growth elements, the biggest two capital allocation and labor force allocation are relatively scarce, and which has a higher rate of return.

After World War II, the population grew rapidly, and the capital was relatively scarce. At that time, the rate of return on capital was high, and investment demand was strong.

But now that global capital is in flood, and the labor force is becoming more and more scarce, the rate of return on investment is naturally lower and lower, and investment demand is also declining.