Tan Haojun
The Federal Reserve has reduced interest rates, and a unconventional interest rate cut.
On March 3, local time in the United States, the Fed announced that the federal fund interest rate standard range reduced 50 benchmark points to fight the economic impact of the coronary virus epidemic.This is the largest rate of interest rate cuts since the Federal Reserve since 2008.After the release of interest rate cuts, the US stocks rose short -term, the three major stock indexes rose more than 1%, and the European stock index also rose rapidly.However, U.S. stocks soon turned to decline and eventually became a big plunge.As of the closing, the three major stock indexes have fallen significantly. Among them, the Dow Jones Industrial Average has fallen 2.94%, the NASDAQ comprehensive index fell 2.99%, and the Standard 500 Index fell 2.81%.
For interest rate cuts, it is generally favorable for the stock market, especially like this large rate cut, which constitutes a lot of benefits.So why did US stocks fall sharply?The reason given by the media is that before the interest rate cut, the speech by Powell, chairman of the US Federal Reserve, has increased the concerns of investors.The original measure of market rescue became a means of smashing.
What exactly did Powell say?Is the Fed Chairman really so powerful?According to the information disclosed by the media, Powell's speech expressed several information.First, the high degree of impact of coronary virus disease in 2019 is uncertain.
Powell believes that the outbreak of the epidemic has also destroyed economic activities in many countries and caused a significant impact on the financial market.Viruses and related prevention measures will undoubtedly seriously affect the domestic and foreign economies for a period of time.The impact of the entire event and its continuous impact on the US economy will be highly uncertain, and the whole situation is also dynamic.
In other words, Powell's awareness of the impact on the epidemic and its possibilities on the economy is much stronger than President Trump, and his recognition in the minds of investors is much higher.Therefore, Powell's view of the epidemic can easily impact and influence investors' psychology.
Second, there is no answer to the problem.Powell said: We can realize that one rate cutting does not reduce the infection and cannot repair the damaged supply chain.We know this.We know that we have not solved all the answers to all questions.Although the outside world is full of expectations for the Federal Reserve ’s interest rate cuts and hopes that interest rate cuts can solve many problems, it is not difficult to see from Powell's speech that his role in resolving economic problems with interest rate cuts is not much confident.In his own words, it is mainly to stimulate the meaning of the economy and cannot solve more problems.In this way, the interest rate cut is equivalent to settlement.The Fed Chairman said such words, how can investors feel panic?
Furthermore, it is not optimistic about the prospects of the US economy.In response to the spread and diffusion of the epidemic in the United States, Powell's feeling is obviously much stronger than the director of the US Centers for Disease Control and Prevention, and Bittan's feeling is much stronger.In addition to responding to an unconventional interest rate cutting policy, Powell also had an uncertainty and not optimistic feeling for the prospects of the US economy.He believes that the Federal Public Marketing Committee judges that the risk will greatly change the prospect of the US economy.
What is the prospect of changing the US economy and has changed greatly?Obviously it is a performance that is not optimistic about economic prospects.If the United States cannot make effective response in the prevention and control of epidemic, Powell and the Fed will have no confidence in the economic prospects of the United States.The Fed's confidence in US economic prospects has shaken, and how can investors feel fear?
The heads of international institutions, international organizations, and well -known enterprises have expressed their views to affirm the achievements and accumulated experience of China's epidemic prevention and control.At the same time as investor services, the Federal Reserve is not expected to have a strong expected US economic prospects, and insufficient confidence in the effect of responding to the epidemic through interest rate cuts, which leads to not only does it not favorable to the stock market, but has caused the stock market to plummet.It must be said that in the face of the impact and influence of the epidemic, the performance of the Chinese government is a model.
The fact is that China has indeed achieved the extreme in terms of anti -crown disease epidemic.Not only that, in terms of how to promote the re -production of enterprises, no country can provide strong support from various aspects such as policies, funds, and services like China.Investors will obviously make China the most important comparison, thus questioning the US government's practice in dealing with the crown disease epidemic, and express dissatisfaction by selling stocks.
A shares are recognized by investors and do not stay away from A shares because of the epidemic, but accelerate the layout of A shares.Especially the northbound funds prove the recognition of A shares with the action of layout and positioning.However, the US stock market was afraid of crown diseases, and investors were very psychologically afraid, and the selling phenomenon became more and more serious, which led to a change in US stocks.
Therefore, the government's understanding and responsibility of the crown disease epidemic has become a question that investors are more concerned and concerned.Why did the Fed ’s unconventional interest rate cut have caused the rise in U.S. stocks?Why is Powell's speech so powerful, and there is an answer.
The author is Chinese Financial Reviewer
