This is a China in transition.
If you can understand the changes in this era, you will be in control of your future.
As many people have said, we are in a harsh environment where there are crises and bubbles everywhere, and seem to collapse at any time. It seems that the Great Depression is coming soon. You can cite many examples. Exports have fallen, real estate is about to collapse, manufacturing is sluggish, coal and steel are backlogged, highways are empty, ghost cities are everywhere, private borrowers jump off the building and run away...
It’s like we see the media with numerous reports of murder, robbery, theft, and terrorist attacks. It seems that it’s not peaceful anywhere, but back to reality, you still go shopping, eat, and watch movies as usual. You are not worried. Terrorists will suddenly appear in front of you.
In the middle of the game, only blind people touch the elephant.
In 2014, standing at the node of this era, the changes in water temperature that I can perceive are as follows.
1. The power of industry laws.
Mature industries are moving towards concentration.
The role of competition and the Matthew effect, profit margins continue to decline, industry leaders are getting stronger and stronger, and small businesses either transform or die.
More than ten years ago, when the home appliance industry was booming, Xinfei refrigerators were well advertised, Meiling refrigerators were kept fresh, there were also Little Swan washing machines, Rongshida washing machines, Aucma freezers, and a large number of brands flourished. Today, only a hundred flowers are left. Go to Haier, Midea, and Gree.
In a mature industry, no more than three companies will survive. Being on a non-competitive side, the feeling of suffering will always be with you.
Similarly, in today's real estate industry, you will continue to hear rumors of small companies breaking their capital chains and going bankrupt. This is not a collapse, but the result of the industry's concentration. From 2010 to 2013, Vanke's sales increased from 1080 billion yuan to 1709 billion yuan, and its profit increased from 70 billion yuan to 150 billion yuan. Its profitability became stronger and stronger. The growth rate of the first-line leaders is far beyond the industry average, and what they are stealing is the survival job of small regional real estate companies.
2. The power of technology
Some industries are declining, and emerging industries are thriving.
In our era, the two technological revolutions being staged are the replacement of traditional industries by the Internet-smart hardware, and the replacement of traditional energy by clean energy.
Print media is in decline, record music is in decline, fixed line is in decline, Nokia and Sony are in decline, and coal is in decline. The other side of the decline is the rise of Internet technology and new energy technology.
The prosperity of the game industry is a reflection of the rapid development of the Internet industry. The answer on the first floor shows that the economy is in recession. Is this black humor? The online game industry began to explode in 2001, with a rapid growth rate of more than 30% each year, attracting more and more users. Does it mean that the Chinese economy has been collapsing since the new century? of course not. Is this industry a key product of China's soft power? From 2010 to 2013, China's online game exports increased from US$2 million to US$10 billion, a five-fold increase. This is a manifestation of the continued strength and prosperity of competitiveness.
The decline of coal is self-evident. In 2009, my country’s total energy consumption was 30.6 billion tons of standard coal, of which:
Coal accounts for 70.3%,
Oil accounted for 18.0%,
Natural gas accounted for 3.9%,
Hydropower, nuclear power, wind power, and solar power accounted for 7.8%.
By 2013, this figure was transformed into a total energy consumption of 37.6 billion tons of standard coal
Coal accounts for 65.7%,
Oil accounted for 18.9%,
Natural gas accounted for 5.5%,
Hydropower, nuclear power, wind power, and solar power accounted for 9.8%.
In four years, the proportion of coal has fallen by 5 percentage points, natural gas and non-fossil energy have taken its place, while total energy consumption is still growing steadily.
The power of technology has eliminated traditional backward products bit by bit, and the illusion of depression only exists in the panic of practitioners in these traditional industries.
3. The will of the government
The government's policy changes have a huge influence on investment and consumption. It is also full of huge uncertainty and unpredictability, especially when new officials take office.
Large-scale investment in infrastructure is the most magnificent decision made by the Chinese government in the past 20 years. The systematic and efficient transportation network and power grid facilities have greatly improved the competitiveness of China’s manufacturing, driving a huge amount of steel, cement, chemical, real estate, furniture and building materials. Downstream industry chain. It can be said that if one piece is alive, the whole game is alive.
Even so, the transformation still exists. Since 2007, infrastructure investment in the eastern coastal areas has been declining, investment in the western and inland regions has been growing rapidly, the growth of expressways has slowed, and investment in high-speed rail and subways has been unprecedented. The direction of investment has changed, and people who depend on old resources naturally feel sad. But in fact, unless the government runs out of money, the Shangfang sword that our party is famous for will still be brandished everywhere in the future. It's just that the method has changed. You may not see it.
Luxury goods industry. When Xi came to power, the anti-corruption butcher knife was held high. Maotai spends the winter, official cars spend the winter, luxury travel abroad spends the winter, high-end catering spends the winter, the evening entertainment circle spends the winter, the Dongguan entertainment circle spends the winter, everyone in the officialdom is in danger. No one knows how long this winter will last, but this is just a winter for the privileged class and luxury goods, and has nothing to do with the overall economy.
4. The power of RMB appreciation
Since 2005, the renminbi has been in a long and stable long bull market for ten years. Why the appreciation will not be discussed here, there will be opportunities to expand in the future, but one thing is certain is that this slow bull market will continue for at least the next ten years.
This is the most amazing financial magic wand of our time.
The export industry is tough.
Export prices have risen, and the competitiveness of low-end processing and export industries has declined. The clothing and shoe owners in Wenzhou, Dongguan, and Quanzhou have lost their lives overnight. They can't get loans, and they can't repay them. However, the export industry is still growing. Exports in 2010 were US$15779 billion, and exports in 2013 were US$22100 billion, an increase of 3% in three years. The world has been so difficult and the growth is still so rapid. It can only be said that the shrinking of low-end exports has been exchanged for The spring of mid-to-high-end export industry.
The consumer industry is nourished.
The export price is expensive, and the profit of a single product naturally increases. Although there seems to be no progress in the consumption transformation year after year, the results are still there.
Let’s take the middle class’s main consumer car as an example. In 2010, the national sales volume was 1800 million. In 2013, this number increased to 2200 million. In three years, it increased by 3 million. What is the concept? In 400, the annual sales of cars was 2000 million, so we can count on our own.
Let's look at another piece of data, the number of tourists going abroad, which is another reflection of the middle class's consumption boom. In 2010, this number was 5200 million, and in 2013 it was 9800 million, almost doubled. And with the increase in the number of people, the proportion of business trips has dropped from 2000% in 40 to about 5% now.
The manufacturing industry is crying.
Low-end manufacturing is complaining, but not all manufacturing industries have lost their vitality. As we mentioned earlier, low-end manufacturing exports are difficult, but overall exports are still growing steadily. Who is laughing? The picture below clearly shows us the changes in the structure of export products. The share of toys and home accessories is shrinking, and the mid-range products such as computers, home appliances, and telecommunications equipment are increasing. As of 2013, the U.S. imported 4400 billion U.S. dollars of goods from China, of which electronic and electrical products were 1175 billion U.S. dollars, and mechanical equipment was 1004 billion U.S. dollars, accounting for half of the total imports. Correspondingly, the amount of textile imports from China in the same year was only 406 billion U.S. dollars. China is no longer a country that sells pants for planes.
The service industry laughed.
The more developed the economy is, the more the service industry becomes the core of driving economic growth. This is the same trend in the West. Movies are on fire, education and training are on fire. In the Forbes Rich List in 2013, the owner of Wanda, who is engaged in commercial real estate, became the richest man. Ma Huateng, Ma Yun, and Robin Li squeezed into the top 10. The Internet transforms traditional industries, terminal retail is withered, and the experiential leisure and entertainment service industry is booming. This is the trend of our time.
Also, I have to mention one thing about private lending.
Among all the talk about the collapse of China's economy, the bursting of the private lending bubble is the one that I like to show up.
In fact, the main flow of capital for private lending is low-end manufacturing and small real estate developers whose banks are unwilling to lend. These industries themselves are in areas with a higher risk range, and the possibility of bad debts is much higher than other industries.
Especially with the appreciation of the renminbi and the centralization of the real estate industry, the demise of these industries and companies is a long-term trend.
Some industries are declining and some industries are thriving.
The laws of nature cannot be violated.
Chinese Friendship Association