Save A shares, don t have too much hope for the national team .

The fundamentals of China's economy are good, and this is an unswerving basic judgment. However, the "conceptual fundamentals" of Chinese society's treatment of the market and capital are not commensurate with the economic fundamentals. How can a "capital market" that hates capital and despises the market do well?

The first is to change the stock index, and the constituent stocks will be selected for two consecutive days to ensure that the stock index only rises and does not fall;

The second is to take advantage of the Spring Festival holiday, close the market until the Lantern Festival, and even Qingming and Dragon Boat Festival.

As soon as these words came out, I could feel the killing intent of my friends across the screen.

Well, I admit, the stock change index is an anachronistic cold joke. But are we still seeing less of this kind of numbers game of accounting skills?

As for extending the break, it's not all a joke. The current performance of A-shares, the cliché "capital side" has no explanatory power, and the "technical side" of the old metaphysics is even more foolish. Adding fuel to the tactics of tinkering with the "bailout" is a negative salary to fight fires, and it will only get worse and worse. Only by finding the root cause of the problem and facing the problem squarely can we solve the problem. It takes time.

The "capital side" is just a skin

* No, the SFC is the first to bear the brunt. scolded and scolded, or pinned their hopes on the intervention of the China Securities Regulatory Commission to improve the so-called "capital side". The "capital side" of A-shares is nothing more than the number of IPOs and major shareholders. The former diverted the funds, and the latter cashed out and exited the market, which was regarded as A-share poison. This wave of ** plummeted, and these two "poisons" are still combined. Some companies have just completed their IPOs, and the major shareholders have cashed out in a fancy way, running faster than a rabbit, leaving only the messy "where am I" and "who am I" in the pick-up style. The grievances of small and medium-sized ** are understandable, but it is useless to scold the CSRC for being incompetent and the major shareholders for being unscrupulous.

There is nothing inherently wrong with the reform of the registration system. In a normal market environment, companies and brokerages are very cautious in choosing the timing of their IPO and do not require much external review. For example, the United States**, which rose sharply last year, instead of IPO chasing the rise, fell sharply. In 2023, there will be 388 IPOs, and the financing scale will only be 198$5.4 billion. Compared with 1,759 and 3,197 in 2021$6.5 billion, that's a lot less. How many years has the registration system in the United States, and the degree of marketization is also higher, and there is no short-term cutting leeks of "fast up and fast out".

The majority shareholder ** is also a very normal operation. There are investments in and out, and there are transitions to change tracks, what is the problem? However, last year's A-share liquidation after the listing of the first type of **, is definitely not normal. This kind of ultra-short-term operation of cashing out of the market is indeed very inauthentic and hurts the hearts of shareholders. However, the mouth cannon output is finished,Shouldn't we reflect on why entrepreneurs and investment institutions are so eager to leave the market?

Capital's pursuit of profit is not a moral issue, and there is no original sin. Institutional investors and entrepreneurs invest in order to pursue profits, and shareholders enter the market to do charity? China has always used *** as a casino to play, how many insist on "long-term"? If they can run faster than the major shareholders, will the shareholders still insist on justice?

A-shares have become the scene of a battle royale car accident, and the small and medium-sized ** is not that they don't want to run, but they don't run away. Can the SFC stop this from happening? Hard. Technically, some obstacles are set up to delay the escape of the "bookmaker". However, it is impossible to forcibly retain customers after all. People don't want to play anymore, and it's in vain to stay.

Therefore,The problem of "capital side" is only the skin phase, and the lack of long-term confidence is the "bone phase". Enterprise operators and market investors have endured long-term environmental pressure, their confidence in long-term operation has been frustrated, and negative feedback has been formed in the capital market.

Confucius taught the way of the parents of the counselor, saying, "If you are small, you will stay, and if you are big, you will escape." The son and the father are just like this, can they expect the "capital" to be killed and not leave?

Improving China's business environment and supporting the long-term operation and development of enterprises is the road to salvation for A-shares. Shareholders can't figure out this truth, shouting and killing every day, hoping that the relevant departments will serve the capital stick, and they can't make money. Superstitious belief in "policy dividends", rather than "market dividends", will only continue to lose. Policies that over-intervene in the market will not bring dividends, but will only cause cyclical backlash, which is a direct factor in today's A-share predicament.

2.The policy cycle is a true cycle

"Cycle" is a high-frequency word in the field of finance and economics, and there are many patterns. The industry has an industrial cycle, science and technology has a science and technology cycle, in addition to the debt cycle, the investment cycle, as well as the "crossing cycle", "counter-cyclical" and so on. Depending on the context, "cycle" has different meanings. The concept is fancy, the reality is simple. There is only one cycle in which China's economy is decided, and that is the policy cycle – the cycle from expanding intervention to contraction exit. The administration is strong, the two big money bags of finance and finance are controlled, and the policy cycle is a real cycle, and other cycles are "meaning meaning".

Since the reform and opening up, there have been two rounds of major policy cycles. The first round was the era of shuanggui from the mid-to-late 80s to the mid-to-late 90s. After the reform and opening up, economic growth accelerated, and the national economy improved substantially. However, state-owned enterprises that lack market competitiveness have stagnated and even have difficulty in operating. Since the late 80s, under the guidance of several rounds of policies, a large amount of fiscal and bank funds have been injected into state-owned enterprises, and the interest rate level reached 14% in 1992. Large-scale capital injections have helped SOEs expand their production capacity, but economic performance remains low. In 1993, the loss rate of state-owned enterprises independently accounted for by the whole country was as high as 30 percent, and the debt ratio of non-financial enterprises exceeded 90 percent, which was far beyond the safety line of the financial system. In 1994, the first large-scale investment in state-owned enterprises was withdrawn, and a large number of state-owned enterprises withdrew, and finally a market economy system was initially built at a great cost. With the rapid growth of foreign exports, the economy finally got back on track around 2001.

This expansion-contraction cycle created at least trillions of non-performing assets, which were digested until around 2012.

The second round of expansion-contraction policy cycle began around 2003, industrial policies were intensively introduced, and color TV production lines, automobile production lines and some heavy industry departments were launched in various places, and the "prosperity" spawned by leading investment lasted until 2007. In 2008, the economic situation at home and abroad changed sharply, the global financial crisis led to a sharp decline in exports, the domestic heavy industry sector overcapacity, and the downward pressure on the steel and coal economy increased greatly. The combined effect of large-scale infrastructure investment and global economic recovery led to a recovery in economic growth around 2012.

There are clear commonalities between these two policy cycles. **The policy-led expansion of investment has kicked off a period of several years of high growth, at the cost of overcapacity and debt growth in the economic sectors that policy focuses on "taking care of", and eventually the economic downturn triggered by internal and external factors.

Moreover, in these two rounds of policy cycles, the boards of "controlling economic overheating" and "policy regulation and control" have been hit on the head of the private economy first. There has also been a counter-current against the private economy in society. In the late 80s, the township enterprises represented by the first generation of private economy were focused on "governance". Although these township enterprises have a limited share of the economy and a negligible proportion of debt, they have become scapegoats for "economic overheating". In the second round of policy cycle, the Tieben incident in 2004 was a landmark event, and the road for private enterprises to enter the upstream industry was blocked, and the business environment and financing environment were also greatly affected.

The recovery in the second half of these two cycles has coincided with the improvement of the situation of the private economy and the relaxation of policies. In 1992, after the speech of the south, the "tight spell" of the private economy was completely released and became the absolute main force of foreign trade exports. After the global financial turmoil in 2008, the development of the private economy in the scientific and technological innovation industry was encouraged, and China's Internet platform economy came out of a wave of climax.

What really promotes economic development is never policy, but the driving force for the economic development of market enterprises.

3.The cost of the policy is greater than the policy dividend

Through the above analysis, it is not difficult to find that because of the absolute strength of the administration, the role of the policy cycle is the main role of China's economy, and the industrial cycle and investment cycle are highly related to the policy cycle. So,Is this policy cycle a policy dividend or a policy cost? Obviously, it is the policy costs that are greater than the policy dividends.

In the first half of the cycle, the policy focused on investment expansion, which did drive short-term growth. However, this growth has come at the cost of overdrawing the economic potential. The ensuing overcapacity and misallocation of resources that inefficient departments take up too many resources can be costly.

Today's A-share dilemma is to pay for the policy cycle. The new energy industry, which had the strongest industrial policy in the past few years, is now the hardest hit area of overcapacity and inflated valuation. Photovoltaics, new energy vehicles, and power batteries have all fallen into deep pits without exception. Shouldn't big A shareholders who are keen on chasing "policy dividends" think deeply? Because of the frenzy of "favorable policies" and brainless positions, they can't escape the forced cooling of "good policies". If there is no market in my heart, how can I talk about rational investment?

The long-term development of any industry cannot escape the laws of the market after all. Industrial policy may be the icing on the cake, but it cannot bypass the market mechanism and create something out of nothing, turning decay into magic.

More importantly, due to the unstable market concept and the serious backwardness of the economic concept in Chinese society, the policy background of the economy is often misled as hostile to and restricting the deformation of the private economy. The decision-making level may not intend to suppress the private economy, but the executive level habitually uses the topic to exert excessive force. The predicament of the private economy in recent years has also played a role in this negative factor. On the one hand, the top management continues to release goodwill and give "reassurance", but on the other hand, it is constantly exerting pressure in the implementation of the policy, and it is difficult to brake the contractionary policy. In an environment that is both warm and cold, it is difficult to eliminate the anxiety and anxiety of business managers, and it is difficult to restore long-term confidence. No matter how good the policy is, no matter how correct the direction is, there is no suitable person to implement it, and there is no social capital to follow up, can we still expect the long-term prosperity and stability of the capital market?

4.There is no shortcut to get out of trouble

In short, the fundamentals of China's economy are good, and this is an unswerving basic judgment. The economic fundamentals in 2023 are no different from those in 2019 and 2009, and there will be no difference in 2024. The problem is never the economic fundamentals, but the "conceptual fundamentals" of economic cognition. The "conceptual fundamentals" of Chinese society's treatment of the market and capital are not commensurate with the economic fundamentals. If the basic understanding of superstitious policy "off-the-market tricks", distrust of market mechanisms, and hatred of capital is wrong, there will be no real capital market, only a speculative battle royale with drums and flowers. The major shareholders who run fast do not talk about martial arts, and how good are the small and medium-sized scattered people who have not run away? Don't talk about martial arts attempts.

So,When talking about A-shares today, we should have less moral discourse and more common sense of market economy. With the existing volume of the a** field, the "casino thinking" of the past can no longer be played. The volume of this plate is too large, and no one can hold it if it is smashed. Stockholders don't expect "one crying, two troubles, and three hangings" to let the "national team shoot" to save the market. Ten pots and nine lids, the "national team" can't take care of it. Should the exchange rate be stable? Should the holes in local finances be filled? The largest foreign-aid bank now has no surplus food. Small money is useless, big money is not, what can the "national team" do? What about the SFC? Without a change in the "fundamentals of concepts," there will be no fundamental improvement in the business environment for enterprises, and there will be no healthy development of the capital market. It's true that this can't be achieved in a day or two, and it's not wrong to say that "far water can't save near fire", but what about "near water"? There is no shortcut for A-shares to get out of trouble.