10月中国M3下行_经济短期稍好后将再度坠落-2012-11-20.pdf

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1、 November 2012 Macroeconomic Outlook US down the cliff The US, already probably slowing in Q4 below 2% growth, could have negligible growth in early 2013, owing to the “fiscal cl China is accelerating from recent 4% annual growth to 6% for a couple of quarters, before relapsing. Eur there. Liquidity

2、 and Central Banks Bank of Japan pushes harder on piece of string The BoJ is to buy government paper. provide no effective Buying foreign bonds may yen lower. Expectations of this have been raised by Decem Investment Outlook Equities Afflicted by late onset cliff tax concerns prompt defensive downgr

3、ades. UK Telecoms/Healthcare regulatory pressure confidence in Mexican Industrials Fixed Income Treasuries and Gilts are only attractive due to safe of CB purchases. We downgrade Canadian bonds to neutral on valuation grounds. We upgrade Mexican bonds to positive alongside Poland and South Africa. W

4、e still prefer US IG corporate bonds to equities as the fiscal cliff gets closer LSR Asset Allocation November 2012 Macroeconomic Outlook down the cliff-face! ! China, Europe has anything changed? US, already probably slowing in Q4 below 2% growth, could have negligible growth in early 2013, owing t

5、o the “fiscal cliff“ remaining at 2 China is accelerating from recent 4% annual growth to 6% for a couple of quarters, before relapsing. Europe, including Germany, is in recession and likely to stay Liquidity and Central Banks Bank of Japan pushes harder on piece of string s to buy around 35trn (7%o

6、f GDP) of assets over the next year government paper. But this will merely flood banks with even more liquidity and effective stimulus to help end deflation. uying foreign bonds may offer a more effective stimulus by helping to push the Expectations of this have been raised by Decem Investment Outlo

7、ok Afflicted by late onset cliff-itis, US equities still need to cheapen further. Dividend tax concerns prompt defensive downgrades. Telecoms/Healthcare falling victim to Eurozone austerity; EM Utilities regulatory pressures; regaining appetite for European Food confidence in Mexican Industrials. Fi

8、xed Income Treasuries and Gilts are only attractive due to safe-haven flows and e of CB purchases. We downgrade Canadian bonds to neutral on valuation We upgrade Mexican bonds to positive alongside Poland and South Africa. We still prefer US IG corporate bonds to equities as the fiscal cliff gets cl

9、oser LSR Asset Allocation has anything changed? US, already probably slowing in Q4 below 2% growth, could have negligible iff“ remaining at 2-2% of GDP. China is accelerating from recent 4% annual growth to 6% for a couple of quarters, ope, including Germany, is in recession and likely to stay asset

10、s over the next year, mainly flood banks with even more liquidity and by helping to push the Expectations of this have been raised by Decembers general election. need to cheapen further. Dividend falling victim to Eurozone austerity; EM Utilities fighting ; regaining appetite for European Food more

11、haven flows and expectations of CB purchases. We downgrade Canadian bonds to neutral on valuation We upgrade Mexican bonds to positive alongside Poland and South Africa. We still prefer US IG corporate bonds to equities as the fiscal cliff gets closer. LSR Asset Allocation November 2012 Asset Alloca

12、tion Macroeconomic Outlook US down the cliff-face! I China, Europe Liquidity and central banks Bank of Japan pushes harder on piece of string Investment Outlook Equities Fixed Income Model Portfolio Asset Allocation is based on the analysis and insights of all LSR economists and strategists. Individ

13、ual sections have been prepared as follows: Macroeconomic Outlook Liquidity and Central Banks Fixed Income, Andrea Cicione; Model Portfolio LSR Asset Allocation November 2012 Macroeconomic Outlook face! I China, Europe has anything changed? Liquidity and central banks Bank of Japan pushes harder on

14、piece of string Asset Allocation is based on the analysis and insights of all LSR economists and strategists. Individual sections have been prepared as follows: Macroeconomic Outlook Liquidity and Central Banks Michael Taylor; Investment Outlook Equit Fixed Income, Andrea Cicione; Model Portfolio Eu

15、genio Montersino. 3 4 4 11 11 13 13 19 23 Asset Allocation is based on the analysis and insights of all LSR economists and strategists. Individual sections have been prepared as follows: Macroeconomic Outlook Charles Dumas; Equities, Melissa Kidd; Asset Allocation 3 Asset allocation matrix (12-month

16、 view) Bold indicates change of view (old rating in brackets) November 2012 Stocks Bonds FX vs $ Monetary policy North America US -1 +1 easier in 2013 Canada -1 0 (+1) -1 unchanged Developed Europe UK 0 +1 -1 QE Switzerland 0 -1 FX target is QE Euro Area -1 -1 easier Germany -1 0 France -2 0 Italy -

17、2 -1 Spain -1 -1 Asia Japan -1 0 0 QE Australia +1 -1 interest rates down China -1/0* 0 easier India -1 0 interest rates down Korea -1 0 interest rates down Taiwan -2 0 easier Latin America Brazil 0 0 0 interest rates up Mexico -1 +1 (0) 0 unchanged Emerging Europe and Africa Russia -1 -1 interest r

18、ates up Poland -1 +1 -1 interest rates down South Africa 0 +1 -1 interest rates down Key to recommendations +2 = strongly positive 0 = neutral -1 = negative +1 = positive -2 = strongly negative Equity sector recommendations can be found on page 18 * -1 China B payroll tax reversion to its pre- 2011

19、rate from the 2011-12 concessionary rate (on employees, not employers), worth 0.8%; ongoing budget tightening established in the debt ceiling agreement of 2011; and various other spending cuts, the most important being those triggered by the failure of the “super- committee” set up by that agreement

20、, worth another 1-1% of GDP. The total is about 5% of GDP, but the Bush tax cuts for those earning less than $250,000 will certainly not be allowed to expire, so the realistic number is 3%. Our view all year has been that 2-2% of this cliff will remain, when the dust settles at Christmas. The 1% ong

21、oing tightening is part of this. The payroll tax reversion seems likely to occur, maybe phased in over a year, as the social security system is in potential financial trouble and cannot afford to be starved of revenue. Some tax increases on the rich are inevitable, as otherwise Mr Obama will veto th

22、e bill and the full cliff will become operational. That already adds up to 2% or more. Both the President and the Congress agreed a year ago to the cuts resulting from the super-committees failure. If that was thought to be necessary a year ago, nothing has happened to alter that conclusion. So some

23、 form of further spending cuts, substituting for the crude sequestration set up by the debt ceiling agreement, seems likely. Hence our 2-2%. US flow of funds, % of GDP -14% -12% -10% -8% -6% -4% -2% 0% 2% 4% 6% 8% 1991 Q21994 Q21997 Q22000 Q22003 Q22006 Q22009 Q22012 Q2 foreigners *general govthouse

24、holdsbusiness * Foreigners balance is the current account balance with sign reversed Numbers do not add to zero owing to measurement errors 6 LSR Asset Allocation Wall Streeters and economists all talk about the effects on growth, focussing on 2013. So they think a shallow (ideally non-existent) cli

25、ff would be “rational”. So it would from the point of view of stock prices, unemployment, the Federal Reserve, etc. But Washingtons timetable now focuses on 2016, or 2014 mid-term elections at the earliest. For politicians, getting the pain over with, to be followed by strong recovery, is an attract

26、ive strategy. We see very little discussion in Washington circles of getting rid of the cliff but plenty about altering its form to suit individual negotiators preferences and points of view. In terms of consequences, a 2% cliff would be a 1% additional tightening to that occurring over the past 2-3

27、 years, when growth has been at about a 2% rate, well below the 3-4% normally achieved in US recoveries. As the US multiplier for fiscal changes now seems to be more than 1.0, courtesy of monetary impotence and weakness abroad, the implied growth of real GDP in 2013 could be very poor, less than 1%.

28、 The weakness would be concentrated in the first half, if the bulk of the cliff hits on January 1st. A significant consequence of expiry of the Bush 2003 tax cuts could be reintroduction of the double taxation of dividends, whose elimination then met a longstanding need. Investors need to watch the

29、negotiations closely to see how this provision fares in the bargaining over substitution of reduced tax loopholes for the reversion of the top rate from 35% to the pre-2003 39%. One persons loophole is another persons just arrangement. Renewed double taxation of dividends would be an egregious and f

30、oolish slap at Wall Street. A major concern is whether the impact of the cliff will reinforce a slowdown already starting which, with a 2% starting point creates a genuine risk of early-2013 recession. The short- term good news is a splendid housing recovery that is probably contributing up to % to

31、GDP growth, even though housing starts from a low base. But the bad news is that real disposable incomes are weak, and the savings rate down, implying a consumer slowdown, and at the same time business cap-ex could be falling off a cliff of its own. Real disposable personal income in September was a

32、t the same level as May, having been higher in all the intervening months. Yet over those four months real consumer spending was up 0.8%, entirely at the expense of the savings rate. This is a 2.4% annual rate, and was reflected in the 2.0% annual rate of growth of Q3 real consumer spending (from Q2

33、). But the sloth of real income could be starting to tell, judging by October retail sales that were down 0.3%. Normally, the vagaries of monthly retail sales reflect gasoline sales that are themselves largely a reflection of gasoline price movements. But on this occasion, despite falling gasoline 0

34、% 2% 4% 6% 8% 10% Sep-92Sep-94Sep-96Sep-98Sep-00Sep-02Sep-04Sep-06Sep-08Sep-10Sep-12 US personal savings rate, % of disposable income temporary tax rebates Macroeconomic Outlook 7 prices, sales were up. The weakness was elsewhere, notably auto sales, but also in other durables and e-commerce. Given

35、the brutal lesson households learned about the perils of debt just a few years ago, it would not be a surprise if a surge in housing even if primarily in rentals that do not involve personal mortgages came partially at the expense of other items typically debt-financed, ie, durables. US consumers ma

36、y have appeared more confident in recent months the housing boom testifies to that but are not yet obviously ready to make merry. Businesses are certainly not making merry, however solid their finances may look (to judge by the flows of funds chart on page 2 above). One reason is well justified fear

37、 of the fiscal cliff why invest a lot if growth is about to stall? Another could be some backwash from the global weakness of manufacturing, centred on both Pacific Asia and Europe. Moreover (see below) US firms as well as others have got themselves a bit long on inventory, so a correction is possib

38、le from that quarter too. Growth of the relevant durable goods orders fluctuate much more violently than that of equipment and software cap-ex itself, but the downward lurch of orders makes falling cap-ex highly likely in both Q4 and 2013 Q1. The chart above shows how the inventory/sales ratio, corr

39、ected for its long-term downward trend (courtesy of hitech) has a strong inverse relationship with the growth of industrial production: too much inventory tending to depress output, and vice versa. After the recovery, the i/s ratio reverted to its long-run trend, but has recently crept up to some 3%

40、 above it. As a result, the 3-month/3-month change of industrial production is now negative. With September Durable goods orders, cap-ex Industrial production & de-trended inventory/sales ratio -60% -50% -40% -30% -20% -10% 0% 10% 20% 30% 40% Sep-01 Sep-02 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 Sep-08 S

41、ep-09 Sep-10 Sep-11 Sep-12 non-defence capital goods orders, excl. aircraftequipment & software cap-ex, real latest 3 months, % change on previous 3, s.a.a.r. -6% -3% 0% 3% 6% 9% 12% 15% 18%-20% -16% -12% -8% -4% 0% 4% 8% 12% Sep-92Sep-94Sep-96Sep-98Sep-00Sep-02Sep-04Sep-06Sep-08Sep-10Sep-12 industr

42、ial production, 3-mth/3-mth % change, annual rate (lh scale) inventory/sales, % deviation from trend (inverted, rh scale) 8 LSR Asset Allocation below the Q3 average, there is every chance that Q4 will be down too, reinforcing the sloth of output and demand. This implies a grim start to 2013, if the

43、 cliff ends up where we expect. Chinas new leaders have taken over with a fine show of ceremony, but they have inherited a tougher task than the American political leadership has to deal with. The huge medium-term problems are detailed and analysed in my new Monthly Review (No 258: “Can the new lead

44、ership revive China”) together with a recommended reform plan to spur an eventual return to fast growth. Not only has the opening up of the economy stalled for years, with financial market reforms promised for 2007 not yet implemented, but the recovery policy since late- 2008 has been precisely wron

45、g. Instead of responding to the debt crisis by dissipating the huge, unproductive savings that are more than half GDP, and starting then the indicated switch to consumer-led growth, the policy was to revive exports by holding down the yuan, and the domestic economy by massive infusions of wasteful i

46、nvestment. As a result, instead of starting to shift investment to a desirable 30-35% of GDP from the 41-42% of 2007, the authorities now have to work out how to get it down there from 2011s 48-49%, five years later. The profit squeeze now under way may cause investment to be slashed, but firms will

47、 also want to stop 10% wage inflation at a time when the PPI is falling by about 3%, and the CPI disinflating fast. And if wage growth were to be cut back sharply, as seems likely, the smooth shift to consumer-led growth would be on hold. Consumer spending will take a larger share of GDP, but more t

48、hrough GDP weakness than consumer strength. Our recalculated GDP growth estimates put the three quarters of 2012 at 0.6%, 0.7% and 1.0%, respectively, with the 4% annual rate of the latest (Q3) equal to the four-quarter increase, also 4%. Unsurprisingly, this has led to a stimulus programme being an

49、nounced. Rather more surprisingly, the domestic stock market has not responded. On the very day that the new leadership team was announced the Shanghai Composite headed seriously south, and it ended the week at 2015, only a touch above the late-September low of 2000. The relatively good news in the October data releases was that exports are holding up. The bad news, apart from stock prices, was that monetary growth, normally the medium for Chinese stimulus programmes, turned down again. Chinese r