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Gavekal Research
Charles Gave, Cedric Gemehl, Didier Darcet
Jan 29th 2021
Webinar: French-Language Webinar, January 2021
With Europe being hit hard by a second wave of Covid-19 and facing fresh lockdowns, Charles and Cedric assessed the outlook for the region’s growth and inflation in both the short and medium term. The webinar also focused on portfolio construction work being done by our Paris team: quantitative head of research Didier and Charles trained their sights on behavioral finance and suggested a route map for managing money in a “post-Keynesian” world.
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Gavekal Dragonomics
Ernan Cui, Rosealea Yao, Wei He
Jan 28th 2021
Webinar: The Outlook For China In 2021
China enters 2021 having achieved a world-leading recovery, but now faces a tricky balancing act to secure its economic trajectory. Ernan Cui, Rosealea Yao and Wei He discussed how the authorities are responding to the latest rebound in Covid cases, what their strategy is for dealing with a frothy property market, and how they will balance growth with financial stability.
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Gavekal Research
Thomas Gatley
Jan 27th 2021
The Sinification Of The Hong Kong Market
Even though the Hang Seng index fell -2.55% on Tuesday, Hong Kong is still the world’s best performing major stock market year-to-date. In Hong Kong’s media the run-up is attributed to waves of mainland Chinese money flowing into the city’s equities. In reality, Connect flows have not been the biggest force driving Hong Kong stocks higher in recent weeks. But structurally, flows of mainland capital are only going to become increasingly important...
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Gavekal Research
Dan Wang
Jan 26th 2021
Supply-Chain Risks For The Covid Vaccine
The race to vaccinate the world in the wake of the Covid-19 pandemic will be one of the most complex projects ever attempted. Most developed economies aim to fully vaccinate their adult population by year’s end. Dan outlines the manufacturing and logistical challenges involved the vaccine rollout
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Gavekal Dragonomics
Dragonomics Team
Jan 25th 2021
Macro Update: Beyond The Boom
China’s unbalanced, industry-driven recovery from Covid has been very strong but is probably close to its peak. Meanwhile, renewed outbreaks are further delaying the normalization of consumer spending and services. In the latest edition of our regular chartbook, the Dragonomics team explains how these tensions will affect the economy in 2021.
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Gavekal Dragonomics
Ernan Cui
Jan 22nd 2021
Restraining The New Fad In Tech
The Chinese government has responded quickly and negatively to community group buying platforms, the latest business-model fad among China’s consumer internet companies. In this report, Ernan explains why subsidized pricing on the platforms has drawn regulatory attention and how this will affect future growth prospects for China’s big tech firms.
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Gavekal Research
Anatole Kaletsky
Jan 22nd 2021
Risks In The Biden Era
In December, Anatole outlined 10 disparate risks that could derail the bull market in 2021. That was before the Democrats won full control of the US government, paving the way for approval of Joe Biden’s new super-size stimulus package. In light of the developments over the last month, Anatole reassesses his 10 risks.
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Gavekal Research
Louis Gave, Anatole Kaletsky, Will Denyer, Arthur Kroeber
Jan 22nd 2021
Webinar: Global Investment Roundtable, January 2021
A Democratic US administration is set to control all arms of the US government for the first time since 2010. Will this mean a fiscal blowout, causing big changes in the pricing of treasuries and the US dollar? Louis, Anatole and Will assess the possibilities.
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Gavekal Research
Anatole Kaletsky, Cedric Gemehl, Nick Andrews
Jan 20th 2021
Webinar: Europe’s Cruel Winter
As the pandemic intensifies across Europe growth prospects in the first quarter are dimming, but investors are focused on a potential economic reopening by the spring. In yesterday’s webinar, Anatole Kaletsky, Nick Andrews and Cedric Gemehl discussed whether markets are overly optimistic since the European Union seems to have botched its vaccine procurement strategy.
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Gavekal Research
Charles Gave
Jan 20th 2021
The Logos, Idiotes And Demagogues
Charles revisits the idea of the Greek "logos", "idiotes", demagogues and citizens, and how the Greeks believed that those who controlled the logos—the language used to describe the world—ipso facto controlled the political system. Problems arise when a new, competing logos started to emerge.
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Gavekal Dragonomics
Xiaoxi Zhang
Jan 19th 2021
Small Borrowers Still Struggling
Even after a dramatic economic recovery, many of China’s smallest businesses are still struggling. In this piece, Xiaoxi shows how the government’s financial-support measures did little to improve small businesses’ access to financing, which is already tightening. But the policies are helping banks avoid a potential spike in bad loans.
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Gavekal Research
Tom Miller
Jan 18th 2021
Biden’s United Front Against China
As the outgoing Trump administration exits with a flurry of executive actions directed against China, Beijing is not sitting around hoping for Joe Biden to spark a new era of détente with the US. The recent tightening of control in Hong Kong shows that President Xi Jinping has no intention of giving an easy early ride to a leader who has pledged to build a “united front of US allies and partners” to constrain a resurgent China. The European...
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Gavekal Dragonomics
Dragonomics Team
Jan 18th 2021
A Two-Speed Recovery
China’s Q4 GDP growth surpassed pre-Covid rates, with housing and manufacturing leading while services lagged and infrastructure investment slowed. In early 2021, this divergence is likely to continue as consumers stay home for the Chinese New Year and poor credit growth drags on infrastructure investment.
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Gavekal Dragonomics
Thomas Gatley
Jan 14th 2021
For Exports, It’s Stronger For Longer
China’s exports have been boosted by two side effects of the Covid-19 pandemic: a shift of consumer spending to goods from services, and the failure of manufacturing in other countries to get back to full capacity. How long can those advantages last? Thomas argues they will continue to boost exports through the first half of 2021.
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Gavekal Dragonomics
Rosealea Yao
Jan 13th 2021
New Ceilings For Property Financing
China’s policymakers are expanding their restrictions on bank financing of the property sector, imposing limits on mortgage lending in addition to curbs on borrowing by developers. In this report, Rosealea explains why the new regulations do not shift her expectations of flat property sales and a modest decline in construction activity in 2021.
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Gavekal Research
Simon Pritchard
Jan 13th 2021
The Squeeze Of Old Hong Kong
Last Wednesday Hong Kong police arrested scores of pro-democracy activists for joining forces to try and win a local parliamentary election and thereafter block government legislation. The use of a tough new national security law to suppress routine political organization threatens more international opprobrium that will further cut the city off from the Anglosphere.
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Gavekal Dragonomics
Ernan Cui
Jan 11th 2021
Covid Headaches Continue
China diagnosed 527 new cases of Covid-19 in the first 10 days of 2021, mostly in Hebei province, in the biggest local outbreak since July 2020. In this Quick Take, Ernan explains why this outbreak is challenging China’s Covid-19 playbook and why its timing is particularly concerning ahead of the Chinese New Year.
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Gavekal Research
Arthur Kroeber
Jan 08th 2021
Strategy Monthly: Darkness Before Dawn? The Covid Vaccine Outlook
As a new wave of Covid infections grips major economies, and social restrictions return, the hopes for a return to pre-pandemic normal rest on the rollout of vaccines. With vaccine production ramping up, most developed economies could reach herd immunity by late in 2021. But many emerging economies will take longer, and several risk factors could still derail the rollout.
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Gavekal Research
Charles Gave
Jan 08th 2021
Portfolio Construction Over The Next Two Years
On Thursday, Anatole set out his view that undivided Democratic Party control of both the executive and legislative branches of the US government opens the door for unconstrained Keynesian stimulus, which will be highly positive for the US economy and equities. It will probably come as little surprise to Gavekal clients that I should dispute whether such unconstrained Keynesianism will be good news either for the economy or for US equities
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Gavekal Dragonomics
Wei He
Jan 07th 2021
Not As Hawkish As Feared
The People's Bank of China is one of the world’s most hawkish central banks—but just how hawkish will it be in 2021? Bond market investors worry that the PBOC, eager to normalize policy, will be pushed into hiking rates by higher inflation. In this piece, Wei argues those worries are misplaced, and that bond yields have more room to fall.
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