Goldman Sachs called on customers to cash in, in the end to see what?

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Goldman Sachs called on customers to cash in, in the end to see what?

2016-10-12 14:28:40 411 ℃

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"Big bear" Goldman Sachs recently issued a warning to the customer, the operation of the strategy is only four words: hurry to cash.

This is the second time Goldman Sachs this month to sing the empty market. Last week, Goldman chief U.S. equity strategist David Kostin issued a report saying the shares of three quarter earnings will be disappointing, because including macro factors of economic growth, interest rates, oil prices, most of the changes.

Various macro data contrast

This time, Goldman is not only bearish U.S. stocks, European stocks also include. Mueller-Glissmannch Christian, managing director of the portfolio strategy and asset allocation, wrote in the report: "it is more likely to be hit now. The next three months to give cash 'super' (OW) rating. This also allows us to have more bullets in the more attractive trading opportunities."

Mueller-Glissmannch also said, we are slightly inclined to strengthen defense, tend to Asia and emerging markets, rather than developed markets."

He pointed out that the U.S. presidential election, the referendum in Italy, and the UK in March next year may start back in Europe program of political risk, coupled with the weak European economy in the United States, high stock prices and other market factors, will make the European market in the next three months to fall.

Goldman Sachs expects the S & P 500 index and the European Storck 600 index fell by about 2% before the end of 12. This prediction is more pessimistic than most strategists, the average value of the 10 forecasts compiled by Bloomberg is the Storck 600 index rebounded from Friday's closing level of 1.3%. The index has fallen by 7.2% since the start of the year.

Storck 600 index chart

Not only is the stock market, the bond market is also in the range of bearish Goldman. The report said, Goldman bonds give "reduction" (UW) rating, and maintain the 10 year Treasury yields target of 2% by the end of the judgment: from now on we expect to see a more smooth adjustment, but because Japan and the European QE project, uncertainty, and the Fed's next point hike approaching "interest rate shock" is still high.

The next 3 months and 12 months of Goldman Sachs investment portfolio is dominated by

Goldman Sachs in the report admitted that the defense is not easy, including gold, including many safe haven assets are quite expensive, but also because the United States to raise interest rates and there is a significant volatility.

On the other hand,Cross asset diversification is more difficult to configure. Goldman Sachs said that the bonds may not be able to hedge the economic downturn, because they are high prices, and inflation is picking up, monetary policy support efforts will be more and more small. In addition, the central bank (for example, the Bank of Japan) although by setting the target rate of return lower bond interest rate volatility, but will reduce the buffer capacity of the bond to the economic downturn, and may cause greater volatility of other assets, such as stocks and foreign exchange.

A massive bearish market is not only the world's largest hedge fund in Goldman, water founder Ray Dalio also warned that the current situation of global finance and 1935-1945 of the United States and Japan over the past 20 years the most like.

Dalio Ray pointed out that some of the views that had been placed on the edge of the border in the present is no longer controversial:

This is not a normal business cycle, and we may be in an unusually slow growth environment;

The current monetary policy tools will gradually fail;

Economic downside risks are getting more and more uneven;

The future rate of return on investment will be very low;

Ordinary people, especially in the middle and lower income groups, will be very impatient in the face of economic stagnation, which will bring dangerous populist and nationalist.

Citigroup in the latest report also expressed deep concern. Strategist Tom Fitzpatrick will present the S & P 500 coverage in the stock market crash of 1987 when the chart, the result is a "make them shiver all over though not cold" chart:

S & P index chart

To know that in October 19th is the history of the famous "black Monday", the Dow Jones industrial average day by day the market value evaporated 22.6%; S & P 500 index fell 20.5%. The spread of the global stock market crash, which caused the world main stock market losses of $17920, equivalent to 5.3 times of the first World War, the direct and indirect economic losses.

Pinch to count, we are in October 19th 2016, only a week's time.