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View detailsGoldman Sachs warns that once the credibility of the Fed is damaged, gold may soar to nearly $5,000.
On Thursday, the Goldman Sachs analyst team stated in its latest report that in the event of the Federal Reserve's independence being undermined, the market will face multiple shocks such as rising inflation, a double decline in stocks and bonds, and a weakened status of the US dollar as a reserve currency. In contrast, gold, as a value storage tool that does not rely on institutional trust, will become a safe haven for investors. Gold has become one of the strongest major commodities this year, rising by more than 30% and hitting a record high at the beginning of this week. The central bank's increase in holdings, expectations of the Federal Reserve cutting interest rates, and Trump's imposition of more control over the Federal Reserve have jointly driven this round of upward trend. The risk of the Federal Reserve's independence has raised market concerns The investment bank describes gold as a "store of value that does not rely on institutional trust", a feature that is particularly important when the independence of central banks is questioned. The report points out that the damage to the independence of the Federal Reserve will lead to a series of chain reactions, including the rise in inflation expectations, the decline in the attractiveness of traditional financial assets, and the potential shaking of the international status of the US dollar. Specifically, Goldman Sachs has set three different price targets for the gold price. Under the baseline scenario, the gold price will reach $4,000 per ounce by mid-2026. This prediction is based on the continuation of the current market environment and policy trends. In the most extreme case, if only 1% of the funds in the privately held US Treasury bond market flow into the gold market, under the condition that other factors remain unchanged, the gold price will soar to a level close to $5,000. The market involves risks. Please invest with caution. This article does not constitute personal investment advice and has not taken into account the individual user's specific investment objectives, financial situation or needs. Users should consider whether any opinions, views or conclusions in this article are suitable for their specific circumstances. Any investment made based on this is at your own risk.
2025-09-04 -
View detailsGoldman Sachs executives: China stock market still has room to rise.
On September 3rd, Kevin Sneader, the president of Goldman Sachs Asia Pacific, said in an interview with the media: Sneader said that although some long-term investors are still seeking clearer policy signals, the inflow of funds into hedge funds has improved. Data for July showed that the scale of Chinese residents' deposits dropped by 0.7% from a record high in June to 160.9 trillion yuan, indicating that retail investors are pouring funds into the market. Previously, jpmorgan Chase predicted that from July this year to the end of next year, approximately 2.5 trillion yuan of additional savings might flow into the stock market, driving stock prices up by more than 20%. Market expectations that China's breakthroughs in artificial intelligence and efforts to cut excess capacity will revitalize growth have driven this round of rally. Furthermore, from a longer-term perspective, the net long position in China's stock market remains at a relatively low level (only at the 56th percentile in the five-year range). Risk Warning and Disclaimer
2025-09-03 -
View detailsDon't underestimate Trump's determination - How will the US "cut interest rates"?
Recently, Peter Tchir, the head of macro strategy at Academy Securities, wrote that such concerns have fueled a widespread expectation that even if the Federal Reserve initiates interest rate cuts, it will only push down short-term interest rates, while long-term yields will face upward pressure due to inflation concerns. At present, this view has become the mainstream in the market and guides the position layout of many investors. Tchir added that these potential policy options go beyond simple interest rate cuts and may involve the coordinated operation of the Federal Reserve, the Treasury Department and even accounting standards. Market concerns over "politicized" interest rate cuts may have overlooked the economic rationality of the rate cuts themselves. Tchir pointed out that even before officials had differences over interest rate cuts, economic data had already shown signs of weakness. For instance, at the Federal Reserve meeting in July, two officials had already raised objections to the decision not to cut interest rates, and the employment data for June, which was released later, was significantly revised down. Powell's speech at Jackson Hole also demonstrated a dovish stance. Tchir believes that if the subsequent employment data fails to show a strong improvement, a 50 basis point rate cut in September is completely within the "reasonable" range and cannot be simply regarded as politically driven. If the interest rate cut is regarded by the market as well-grounded, then the "alarm" that investors expect - that is, the sell-off of long-term bonds - is unlikely to come true. Tchir believes that another reason why the US government is considering unconventional options is that the effectiveness of traditional monetary policy tools is weakening. Furthermore, since the era of zero-interest rate policies, many enterprises, individuals and municipal bond issuers have locked in long-term low interest rates, which has greatly reduced their sensitivity to changes in front-end interest rates. This means that the effectiveness of transmitting monetary policy through short-term interest rates is no longer as strong as before. If the effects of traditional tools are not significant, the government may open its "toolbox" of unconventional policies and directly intervene in long-term interest rates. One possible strategy is to "achieve everything in one fell swoop". For instance, a one-time significant interest rate cut of 100 basis points, while committing to keeping the interest rate unchanged in the coming quarters, unless there is a major change in the data. "Attack" inflation from the data level Tchir pointed out that the new indicators compiled by the Cleveland Fed show that real rental inflation has dropped back to normal levels and is far lower than housing inflation in the CPI. By emphasizing such data differences, the US government can effectively alleviate market inflation fears and clear the way for interest rate cuts. Perhaps the most core approach is to restart the "Operation Twist" (OT), by simultaneously selling short-term US Treasuries and buying long-term US Treasuries to lower long-term interest rates. Tchir pointed out that this move would nearly triple the Fed's holdings in the ultra-long-term bond market, and its purchasing power would be sufficient to influence or even control the ultra-long-term bond market, which accounts for about 50% of the free float, thereby directly depressing long-term yields. Other more disruptive options may also be taken into consideration. In addition, reassessing the United States' gold reserves is also an option. It is estimated that if the official gold reserves of the United States were revalued at market prices, it could generate an accounting gain of approximately 500 billion US dollars. Although this move is complex, it can effectively divert market attention and may provide funds for other investment plans. Risk Warning and Disclaimer
2025-09-01 -
View detailsWaller, the top candidate for the Fed chair, said that Ethereum and stablecoins are the next steps in payment development and institutions should adopt them
On Thursday local time, Federal Reserve Governor Waller delivered a speech at the 2025 Wyoming Blockchain Conference. In terms of regulation, Waller called the GENIUS Bill a "good start" and promised to gradually address existing issues as it progresses. The GENIUS Act requires stablecoin issuers to hold a 1:1 high-quality liquid asset reserve, while the CLARITY Act clarifies the regulatory framework for digital commodities, eliminating regulatory uncertainty for institutional investors. The GENIUS Act came into effect in July 2025, establishing the first federal regulatory framework for stablecoins in the United States. To align with the GENIUS Act, the CLARITY Act passed by the House of Representatives in July 2025 further clarified the jurisdictional boundaries of the SEC and the CFTC. This dual legislative framework has created a favorable environment for institutional adoption, driving the rapid growth of Ethereum-based tokenized assets and ETFs. As of the third quarter of 2025, the asset management scale of Ethereum ETFs reached 27.6 billion US dollars, with the inflow of funds exceeding that of Bitcoin ETFs. Blackrock's ETHA ETF attracted a $10 billion asset management scale within ten days of its launch. Blackrock's BUIDL platform and Franklin Templeton's Progmat, among others, are leveraging Ethereum infrastructure to offer decentralized ownership of assets, combining traditional finance with blockchain programmability. The reduction in transaction fees has directly lowered the cost of running decentralized finance (DeFi) applications on Ethereum, attracting more institutional funds to enter. The total value locked (TVL) of DeFi has reached 223 billion US dollars, with a huge amount of funds being invested in decentralized financial products such as lending, staking, and liquidity pools. Risk Warning and Disclaimer
2025-08-29 -
View detailsChina's robot industry chain: Upstream earns more than downstream, 2027 will be the
On August 26th, according to the latest industry report released by HSBC, the commercialization process of Chinese humanoid robot manufacturers is accelerating to outpace their overseas competitors. Although Tesla lowered its production target for its Optimus robot in July, raising concerns about the future of humanoid robots in the market, the report believes that the market has overlooked the progress made by Chinese enterprises in this field. The advantages of Chinese enterprises mainly come from four aspects: being closer to the supply chain, having more competitive product pricing, receiving support from large orders of state-owned enterprises, and government policy support. The true winners: Upstream core component suppliers Compared with downstream manufacturers, the profit prospects of upstream component suppliers such as Sanhua Intelligent Control, Shuanghuan Transmission, and Hengli Hydraulic are more optimistic. The report holds that its advantages are reflected in three aspects: higher market concentration, standardized products can achieve cost reduction through large-scale production, and relatively low operating expenses. The report predicts that during the period of 2025-2035, the average annual market size of humanoid robot actuators, sensors and software will reach approximately 68 billion yuan, 28 billion yuan and 17 billion yuan respectively. The reason why domestic robot manufacturers have been able to seize the initiative mainly lies in multiple advantages. The second is price competitiveness. Take the latest general-purpose humanoid robot released by Ushu Technology as an example. Its retail price is only $5,600 per unit, while the price of Tesla Optimus is between $25,000 and $30,000. This significant price difference helps to shorten the payback period and enhance user acceptance.
2025-08-27 -
View detailsThe third-in-command of the Federal Reserve: The era of low neutral interest rates
On Monday, August 25th, John Williams, the president of the Federal Reserve Bank of New York, clearly pointed out in a speech prepared for a meeting of the Central Bank of Mexico that there is almost no evidence that the neutral interest rate has rebounded significantly from the pre-pandemic low, and stated that "the era of low r-star seems far from over." Williams said that the powerful structural forces that have continuously depressed global interest rates over the past few decades have not disappeared, that is, "the global demographic and productivity growth trends that have driven r-star down have not reversed." The current neutral interest rate may not be much different from that before the pandemic. Williams' remarks came at a delicate time, following the speech made by Federal Reserve Chair Powell at the Jackson Hole Global Central Bank Symposium last Friday. At that time, Powell opened the door for the Federal Reserve to cut interest rates at its September meeting due to signs of weakness in the job market. It is worth noting that there are differences within the Federal Reserve regarding the precise level of the neutral interest rate. It is reported that the forecast released in June 2025 shows that the median estimate of the neutral interest rate by policymakers has risen from 2.5% before the pandemic to 3%, but the forecast range varies from 2.5% to nearly 4%, indicating considerable uncertainty. Risk Warning and Disclaimer
2025-08-26 -
View detailsIs it certain that the Federal Reserve will cut interest rates in September? There are still two major pieces of data that may overturn expectations
In his speech on Friday, Powell made it clear that the downside risks facing the labor market might "require an adjustment to our policy stance", paving the way for the Fed to end its eight-month pause. U.S. Treasuries and the stock market rose sharply upon hearing the news, and the yield spread between 2-year and 30-year Treasuries widened to its highest level in nearly four years. The pricing in the futures market suggests that the probability of a 25 basis point interest rate cut in September is approximately 75% to 80% at present. Key data will determine the pace of interest rate cuts Stephen Brown of Capital Economics said that Powell's conclusion that "policy is in a restrictive range and a shift in the benchmark outlook and risk balance may require an adjustment in policy stance" clearly indicates that a rate cut in September is now the most likely outcome. Futures traders also did not consider a 25 basis point interest rate cut on September 17 as a definite event. The pricing in the futures market suggests that the probability of a 25 basis point interest rate cut in September is approximately 75% to 80% at present. Even after rising on Friday, bond yields have yet to break through the lows they hit earlier this month. Inflation concerns have limited the gains of long-term bonds Compared with long-term US Treasuries, which are more affected by inflation and the risk of government deficit expansion, short-term US Treasuries have a more certain upward space after the Federal Reserve resumes its accommodative policy. Risk Warning and Disclaimer
2025-08-25 -
View detailsThe next landmine on Wall Street? Default warnings in the US private credit market have soared
On August 21st, it was reported that several institutions released reports this month indicating that potential pressure in the private credit market is emerging. A report by jpmorgan Chase based on KBRA DLD data shows that if non-accrual loans expected to result in losses are included, the default rate in this market has climbed to 5.4%, roughly equivalent to the default rate in the broad syndicated loan market. Although returns of over 8% are still attracting investment, fundraising for private credit funds has significantly slowed down. As of July 22nd, the fundraising scale for this year was only 70 billion US dollars, accounting for one-tenth of the inflow of alternative assets, the smallest proportion since 2015. The definition of default in the private credit market is not uniform. Currently, the publicly disclosed default rate is within the range of 2% to 3%. However, a report by jpmorgan Chase pointed out that if non-accrual loans - that is, loans on which lenders expect to incur losses - were included, the default rate would jump to 5.4%. The main selling point of private equity credit is its low default rate, but this reputation is built on a narrow definition of default. If "selective defaults" such as maturity extension and the conversion of interest payments from cash to in-kind are included in the calculation, the proportion of borrowers unable to fulfill their debt obligations is much higher. The company pointed out that the default might be "masked by a large number of corrective activities", as lending institutions can adjust credit agreements to delay the default. Jpmorgan Chase analysts Stephen Dulake and others warned in this month's report: Private companies and their lending institutions avoid cash default through in-kind payment arrangements, allowing borrowers to postpone cash interest payments until debt maturity, and eventually face a huge bill. Another approach is to set the contract terms at a "loose" level, making it difficult to take action on early weak signals. The concentration of borrowers in the weaker credit rating category is higher, and the recent increase in the default rate indicates that there is continuous resistance. In addition, the ability of private equity credit funds to attract capital is weakening. Although a return rate of over 8% is still attracting investment, private credit funds are no longer the capital magnets of the past. The market involves risks. Please invest with caution. This article does not constitute personal investment advice and has not taken into account the individual user's specific investment objectives, financial situation or needs. Users should consider whether any opinions, views or conclusions in this article are suitable for their specific circumstances. Any investment made based on this is at your own risk.
2025-08-22 -
View detailsThe Most Comprehensive Guide to the Jackson Hole Conference: Everything You Must Know Before Powell Speaks
At that time, Federal Reserve Chair Powell will deliver a speech at the Jackson Hole Global Central Bank Conference, and the market is closely watching whether he will open the door to a rate cut in September. Currently, currency market traders expect that the possibility of a 25 basis point interest rate cut in September has reached 80%. The Jackson Hole meeting has always been an important platform for the Federal Reserve to convey policy signals. In 2023, Powell's speech once led the market to expect the first interest rate cut in September. The theme of this year's conference is set as "The Labor Market in Transition: Population, Productivity and Macro Policy". On the surface, it seems to be an academic topic, but the actual signal it conveys is that after inflation has eased, the Federal Reserve is shifting its focus back to employment. At a time when cracks are emerging in the labor market, minor adjustments to the policy tone may directly determine the market trend in the coming months. Focus on Powell's views on the labor market Powell warned at the July FOMC press conference that the potential for new jobs in the US labor market is declining, due to factors such as a slowdown in immigrant inflows and an aging population, that is, a decrease in the so-called "threshold for job growth". The significant downward revision of the July non-farm payroll data confirms this point: job growth may have nearly come to a standstill, with the unemployment rate rebounding to 4.2% (still below the long-term average), and although wage growth has slowed, it has not yet fully declined. According to Goldman Sachs economist David Mericle 's prediction, Powell may revise his statement at the July FOMC press conference, no longer emphasizing that the committee is "in a good position" (well positioned) to wait for more information. On the contrary, he may point out that the Federal Reserve is capable of dealing with the risks of a dual mission, while emphasizing the downside risks to the labor market shown in the July jobs report, thereby conveying to the market the intention to support interest rate cuts if necessary. Jackson Hole has always been regarded as a policy barometer of the Federal Reserve. Over the past five years, almost every year has witnessed a "policy inflection point" : in 2019, it hinted at easing; in 2020, the average inflation targeting system (FAIT) was introduced; in 2021, the continuation of easing led to misjudgment; in 2022, it shifted to aggressive tightening; in 2023, it indicated that interest rate hikes were coming to an end; and in 2024, it sent out signals of interest rate cuts. Goldman Sachs believes that the Federal Reserve may return to a more traditional "two-way employment deviation" target (focusing on both undergrowth and overgrowth), while abandoning the "average inflation target" and reverting to the "flexible inflation target" as its main strategy. However, when interest rates hit the zero lower limit, some compensatory tools may still be retained. If these expectations come true, Jackson Hole's "inflection point effect" may repeat itself: the framework set in 2020 May now be partially revised by 2025. Regarding the Federal Reserve's interest rate decision in September, Wall Street's expectations for the number of rate cuts have shown significant divergence, with different institutions focusing on their interpretations of employment and inflation data. The bank believes that the Federal Reserve may cut interest rates by 25 basis points three times this year. The reason is that the July non-farm payroll data and the revisions of the previous two months show a significant slowdown in job growth. Although the unemployment rate is low, the potential for new jobs has declined. Market and wage pressures are still manageable. Goldman Sachs expects the Federal Reserve to take decisive action to prevent the labor market from deteriorating further. Jpmorgan Chase, on the other hand, takes a more cautious stance. The bank's market intelligence team pointed out in a report that given the Fed's decision to cut interest rates in September will rely on the non-farm payroll data on September 5 and the CPI data on September 11, the Jackson Hole meeting "may not have a substantial impact". Historically, the bond market has typically shown a clear response to the Jackson Hole conference. According to Bloomberg data, U.S. Treasury yields have often experienced significant fluctuations during meetings in the past few years.
2025-08-21 -
View detailsTop Goldman Sachs trader: The core issue for the US stock market in the coming months is "Recession or interest rate cuts, who will come out on top?"
The US stock market is walking on the edge of a knife. On the one hand, the signs of weakness in the US job market are becoming increasingly clear, and the risk of an economic slowdown is accumulating. On the other hand, market expectations for the Federal Reserve to resume interest rate cuts have also risen as a result. Goldman Sachs believes that the next two months will be a decisive observation period. This tug-of-war between growth and policy will influence the next steps of the US stock and bond markets. According to the Chui Feng Trading Desk, Dominic Wilson, a top trader at Goldman Sachs, wrote in his latest research report that the core challenge for current investment lies in how to find investment targets that can both benefit from the market's expected interest rate cuts by the Federal Reserve and provide protection when the risk of a deep economic recession in the United States becomes a reality. For the global stock market, this is also a delicate game of balance. The report points out that as long as the deep downside risks can be avoided, the US stock market can continue to "climb the wall of worry". However, given that the market has priced in the slowdown in growth quite fully and the risk of recession remains high, the risk of a stock market correction is higher than ever before. Meanwhile, the market has repriced the Fed's easing path, and the possibility of a rate cut in September is very high. Short-term US Treasury yields still have room to decline, and under the expectation of more aggressive interest rate cuts, the yield curves of 2-year and 5-year US Treasuries may steepen further. The job market is flashing a red light: A turning point signal is worth being vigilant about The July non-farm payroll report, especially the significant downward revision of the data from the previous months, has completely changed the game rules. Goldman Sachs emphasized that this change has drawn the attention of the market and policymakers to the "employment" side of the Federal Reserve's dual mission. Although inflation caused by tariffs remains a concern, job growth has dropped sharply in multiple indicators. The latest employment data paints a picture of the labor market where "there is not much recruitment but large-scale layoffs have not yet occurred", which is more consistent with the weak performance of other economic activities. Goldman Sachs particularly warns that such a significant downward correction is typically a typical feature of a cyclical turning point in history, so investors should take this weak signal seriously. The "downside risks to the labor market" mentioned by Federal Reserve Chair Powell at the last press conference have now become a reality. If the unemployment rate rises further, it may retrigger recession fears similar to those predicted by the "Sahm rule". Therefore, several upcoming US employment reports may have an extraordinary impact on the market narrative. Countdown to interest rate cuts: Market expectations return to a loose track After the release of the July non-farm payroll data, market expectations for the Federal Reserve to cut interest rates underwent a significant shift. Goldman Sachs pointed out that the Federal Reserve is very likely to resume its rate-cutting cycle in September. At present, the interest rate cut in September has been fully reflected in the market pricing, and the expectation of the number of interest rate cuts throughout the year has exceeded two. Despite this, Goldman Sachs still believes that the trend of short-term Treasury bond yields is biased towards a downward direction. In addition, the upcoming nomination of the new Federal Reserve chair may also strengthen the market's belief that interest rates will remain low for a longer period of time. The report concluded by noting that if more signs of weakness emerge in the job market, the market might be more determined to price in an earlier and more significant interest rate cut. In this scenario, the yield curves of 2-year and 5-year US Treasury bonds (2s5s) have ample room for steepening. Meanwhile, as market implied volatility continues to decline, options products betting on the Fed's accelerated rate-cutting cycle, as "recession protection" tools, appear quite attractive. Risk Warning and Disclaimer The market involves risks. Please invest with caution. This article does not constitute personal investment advice and has not taken into account the individual user's specific investment objectives, financial situation or needs. Users should consider whether any opinions, views or conclusions in this article are suitable for their specific circumstances. Any investment made based on this is at your own risk.
2025-08-20