저자: Investment Trends · 외국인
다듬은 글
editor and publisher of the gloom boom and doom report, Mark, thank you so much for joining us today. All right, and this week's stock market rapper, I really appreciate that you were able to come on today. We also have James Anderson co-hosting with us today.
The first topic I'd like to discuss is the China and US trade war that seems to be developing. What is your perspective? Do you think it can get worse from here, or will a real trade war actually develop?
무역전쟁 전망
I doubt there will be a real trade war, because I believe the US will realize it actually has more to lose than China. For China, exports to the US are meaningful, but they're not as important as they would have been 40 years ago. When I went to Hong Kong in 1973, until the end of the 1980s, the saying was: "If America sneezes, Asia catches a cold," because up to 70 percent of Asian exports went to the US, directly or indirectly. But this is no longer the case.
아시아 교역 구조의 변화
Nowadays in Asia, the largest trading partners are actually Asian countries. All Asian countries export more to China than to the US, with the exception of India. Globally, China exports more to commodity producers and to countries that have a free trade agreement with China than to the US. So the US is still an important trading partner, but it's no longer the most important trading partner.
달러 강세 전망
Now, my thoughts. I know this is more of a short-term question. There are a lot of people out there who are US dollar bullish, at least in the short to medium term. I think there's going to be a rebound. Last year the dollar fell about ten percent versus other major fiat currencies. Do you see any type of rebound in the DXY, or is it still alive, potentially?
Well, there has been a big long position in euros and a short position in US dollars in recent weeks. Obviously, if you just look at the trade war, you can see the dollar strengthening, but I don't think these things will last very long. When you think about it, the US under Mr. Trump would actually like to make America great again. He wants to make America more competitive. Some are complaining about the weakness of other currencies in the world, and in his view the dollar is too strong compared to other currencies. I'm not sure he can think that far, but anyway, that is the implication. So the last thing the US administration wants today is a strong dollar, because that makes the US even less competitive. So I think the dollar may strengthen, maybe for another month or two, and then eventually, as it becomes obvious that other countries, with or without tariffs or a trade war, remain very competitive, it will weaken again.
미국 증시 고점 논쟁
Now, as for the stock market, do you believe Asian stocks, or specifically Chinese stocks, are more attractive to you than US stocks?
I believe we've seen the high for the US stock market and global markets essentially on January 26, 2018, with the S&P at 2,872. We're now approximately 200 points lower than we were at that time. Now, the market is unlikely to crash in my opinion, but what could easily happen is a market decline, like we had between 1969 and 1982. We didn't collapse in those days, although we had a major bear market between January 1973 and December 1974, for almost two years. But we didn't really have a crash. It was more a slide, a slope of hope where markets would go down, then rebound, and then go down more slowly than the rebound, and go down even further. I think that may be a scenario that could unfold, similar to 1969 to 1982.
금 대비 주식 비율
If you look at the Dow ratio back then, it reached about 1.4 at its peak in January 1980. The Dow is obviously not the greatest measure of the stock market, because it's 30 companies that get swapped out all the time depending on how well they're doing. I think GE is the only one still around from the original inception, and it's been a terrible stock, that's true. But if I look at the S&P 500 to gold ratio, right now we're around just 2, or roughly S&P versus gold. In 1980 it hit point two. So if we went back to a situation like 1980, that would be a 10-fold multiple of gold versus the S&P 500. Do you foresee that happening, say, in 2020? Is that something that could be the peak of this?
Well, I could see that happening again in the sense that the S&P would underperform gold in the years to come, and that wouldn't surprise me. But the point is, it may not happen right away. It may happen in the future. It may take a few years until we're there, because the belief right now among investors is very strongly geared towards equities globally, and especially among young investors. At the moment, gold and silver are not particularly popular among young investors, but I think this will change, especially when a major fraud is revealed in the crypto space and people lose faith in cryptos as a store of value. Then they will buy gold again. I don't know when gold will go up. I suppose it will go up relative to other assets.
자산 인플레이션의 종말 가능성
Now, there's one point I need to clarify. Everybody thinks that asset inflation, as we've had essentially since 1981 (bonds bottomed in September 1981 and equities in August 1982), will continue. Equities rallied over the last 34 years, real estate prices went up, art prices went up, collectibles went up, and so on. So people and investors are conditioned to believe this will continue. They may argue about which asset will perform the best, but they think asset inflation will continue. I'd like to introduce the possibility that all assets could go down, with gold falling far less than other assets, or even increasing in value.
So you're describing an extreme deflationary scenario?
I'm not necessarily talking about huge price deflation, but I'm talking about a huge asset deflation, where the prices of assets really tank. That is a possibility, because don't forget, and this is a subject that isn't discussed much, towards the end of a bull market the subject of debt has taken a back seat. In other words, people mention government debt, but then they argue, "Well, it's already so large, and so far it hasn't caught up, and the government can expand much further, and the Fed can expand its balance sheet much further." That is what people believe, but it may in fact not help asset prices. In fact, it may hurt them as debt rises.
암호화폐 전망
Can you expand on why you see cryptocurrencies falling in the future, and people moving out of that space?
My sense is that, as a citizen, I have no idea what these cryptocurrencies should be worth. Really, no idea. It's a little bit like you and me printing a new currency or a new banknote, say a "Cipher dollar" banknote, or "one militant rod" or "dot," and restricting the number we print to, say, a million or ten million or twenty million. Then our neighbors see that we were able to sell these freshly printed banknotes, and they think it's such a great idea that they start their own printing machines, and e-tron's, also something like new paper currency, and so on and so forth. The crypto craze has now created more than 1,500 different digital currencies, and I have my reservations about whether they will all be worth anything. Maybe one or the other will have some value, yes, but I don't know what the value will be. And if I have no idea what the value will be, I'm not terribly interested in investing a large amount of money in this concept.
I'm not sure if you're familiar with the Mt. Gox case. I think there was an academic study about Mt. Gox and the price of Bitcoin going from 150 dollars to a thousand dollars. You can google it. I think it's called "price manipulation in the Bitcoin ecosystem." That study examined the data, and no one, except for the people who ran Mt. Gox, got indicted for it. So my hunch is that Bitcoin traders were simply emboldened. If you look at the concentration of who owns bitcoins, it's only about a thousand or so entities that own about 40% of the Bitcoin in the world. So for them to collude and drive the price up and down to make money, and with futures now on the cryptos, it's possible to make money both ways.
How much it will ultimately be worth, I can't say. What I have observed, however, should be a warning signal. I have a house here in the north of Thailand, specifically in Chiang Mai. Chiang Mai is a city that consists mostly of people who have no share ownership. They've never owned a single bond, never traded on an exchange. There are just a handful of people I know who occasionally trade stocks. The bulk of people don't have any interest in stocks and have no money to buy them. If they have money, they'll buy a house. But all these people, over the last year, people who never speculated before, are now all involved in cryptocurrencies. And this isn't just happening in Chiang Mai. I get emails from people in Estonia, from people in Hungary, and tourists in Korea, in China, and in Japan. They all gamble on these cryptos. Whenever the public is so fully involved in one object of speculation, it's always a warning signal. But the future will tell. I don't want to say anything negative about cryptos, and I don't want to say anything positive either. I think blockchain technology is here to stay, but it's not new. It was developed earlier, and I have no idea about the end value of cryptos. I suppose 90 to 98 percent of cryptocurrencies will be worthless, but maybe one or the other will have some value.
금과 은 비교
Moving on: you said you're bullish on gold, and you think people will move into gold and silver. What is your perspective? Which is better, gold or silver?
From my technical indicators, I think silver probably has the greater upside potential. But I'd like to qualify that by saying I have been buying gold since the late 1980s. Most of the gold I bought was around $300 an ounce, and I continued to buy during the bear market between 1999 and 2011, and I kept buying. I've never sold an ounce of gold. For me, whether the price goes lower or higher doesn't change my lifestyle, but I want to have some reserves that are not held in paper form. I hold some gold in Switzerland and some here in Asia.
Do you specifically prefer one form? I assume you hold gold physically, in coin form like Krugerrands, or some coins issued by certain mints?
Yes, essentially pure gold investments, those types of coins. I also have some gold shares, but not much. It hasn't happened yet, but I think they are again in a range from which they could have, say, a 30% upside move.
All right, Mark, thank you so much for joining us today. Before you go, did you want to assure the viewers of any last thoughts and where we can find you online?
Well, we have a website, and thank you.
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