In his previous strategy review, Wei Fengchun, Chief Economist at China Gold Fortune Fund, examined the risk of losing control over US Treasury yields and used gold as an example to highlight the intertemporal challenges in asset allocation. Balancing long-term constraints against short-term disruptions is a highly nuanced practice, and researchers often compress long-term issues into short-term narratives to amplify their impact, which inevitably leads to a discount in the practical application of their findings. Investors typically dare not—and should not—overly focus on long-term concerns, otherwise they risk falling into the trap of excitement and anxiety over hypotheticals, invoking Keynes's famous line: "In the long run, we are all dead."

This boils down to a philosophical question of aligning knowledge and action: how to merge research with investment, how to move beyond purely long-term allocation assumptions, and how to integrate macro trading into allocation from the perspective of time value. These are the urgent practical issues that macro strategy work must address.

Market Review: Inflation Trading and Supply-Driven Dynamics Resume

Over the past week, global asset classes and A-share sectors displayed significant structural divergence: crude oil and agricultural commodities surged, while gold and silver experienced deep pullbacks. The US dollar strengthened, pressuring major global equity indices. Within the A-share market, there was a clear split, with traditional value, defensive, and thematic stocks gaining ground, while power equipment and pharmaceuticals suffered sharp declines. The underlying logic suggests that inflation trading and supply-driven factors have resurfaced, further dampening rate-cut expectations, which in turn strengthened the dollar and triggered corrections in precious metals.

Specifically, escalating geopolitical risks and tight supply conditions drove the moves. Recurring tensions in the Middle East and the Russia-Ukraine conflict fueled concerns over disruptions to crude supply chains, while OPEC+'s sustained production cuts constrained global supply, pushing oil prices notably higher. Domestic energy commodities like coking coal also strengthened, supported by safety inspections and output reduction expectations at domestic mines. Adverse weather threatened crop yields in key production areas, heightening supply-demand tightness expectations, while shifts in global trade logistics and import-export policies further lifted agricultural prices. The correction in gold was primarily driven by a rebound in the US dollar index—up 0.8% over the week, directly pressuring dollar-denominated precious metals—and by high interest rate expectations. Following substantial gains in gold and silver earlier, signals that the Fed might slow its easing pace triggered strong profit-taking and redemptions.

From an equity perspective, the high海外利率环境 continued to weigh on global tech growth valuations, with the Nasdaq, S&P 500, and Hong Kong's Hang Seng Tech all weakening. Within A-shares, funds rotated from previously high-valuation growth sectors into high-dividend, low-valuation large-cap blue chips and policy-driven micro and small-cap stocks, indicating an ongoing rebalancing process.

Realistic Constraints of Capital and Time on Investment

Recent interactions with investors have yielded four key observations: first, narrative-driven trading has lost its edge, with earnings-driven performance becoming evident, a trend confirmed by second-quarter reports. Second, there is a pronounced conflict between macro allocation and macro trading, with gold allocation serving as a typical example. Third, growth differentiation is clear, as seen in corporate AI capital expenditures, where markets assign vastly different valuations to offensive versus defensive investments. Fourth, the impact of ESG on businesses is becoming a standard consideration. This review focuses specifically on macro and trading issues, which fundamentally boil down to the realistic constraints that capital and time impose on investment.

Keynes's famous quote is often taken out of context in the investment world, sometimes used as an excuse to focus solely on the short term while ignoring long-term value. However, when viewed in its full context and alongside Keynes's own investment practices, the statement offers profound insights for investment analysis and research:

1. Survival is the primary principle: be wary of "seeing the distant horizon but dying along the way." The harshest truth in capital markets is that correct long-term judgments cannot rescue a collapsing short-term position. Keynes himself once faced a margin call after heavily leveraging a long position in the German mark. Although his long-term macro view was correct, market irrationality exceeded expectations, leading to a forced liquidation due to severe short-term volatility. This teaches us that no matter how flawless the long-term logic, one must first ensure survival. Leverage, position management, and cash flow constraints are the real bottom lines in investment.

2. Capital and time impose real constraints: fundamental value reversion may take 3, 5, or even 10 years, but investors' capital carries costs, has maturity limits, and is subject to finite psychological endurance. If these constraints apply, "waiting for value reversion" becomes a luxury. Therefore, investment research cannot discuss long-term value in isolation from time horizons and capital constraints; doing so essentially bets on outlasting the market, but the market always outlasts you.

3. "Animal spirits" and market irrationality: the emphasis on macro trading is closely linked to Keynes's concept of "animal spirits," where human decisions are largely driven by instinctive emotions such as greed, fear, and herd behavior. Short- and medium-term price movements are often dominated by shifts in collective expectations rather than gradual fundamental evolution. This means that while fundamental analysis is important, it is frequently diluted by irrational sentiment in the short run, and the degree of rationality is hard to quantify.

4. Reflexivity between expectations and reality: participants' expectations not only predict prices but also influence them, and price changes in turn alter expectations, creating a two-way feedback loop—this is Soros's systematized "reflexivity" theory. Rising stock prices can improve a company's fundamentals, while a sharp decline triggering pledged-share liquidations can worsen them. When an expectation becomes strong enough, it can partially create the reality it predicts by altering capital flows and corporate behavior. In macro strategy research, most analysts currently employ a one-way rather than reflexive logic, a gap that clearly needs strengthening. Our emphasis on macro trading does not negate long-term value; rather, it reminds investors not to use vague long-term promises to escape pressing immediate constraints and systemic risks. True investment decisions require both a long-term perspective that traverses cycles and the survival wisdom to handle short-term irrational fluctuations.

Key Events Shaping Macro Trading

Recent events influencing macro trading span impacts on risk-free rates, risk premiums, and earnings. First, risk premiums remain elevated in a volatile range. The recent sharp adjustment in risk assets is closely tied to rising risk premiums. This includes repeated US-Iran tensions and the expansion of the Russia-Ukraine conflict, which have kept global crude prices high. Combined with weather-related threats to food supply, inflation trading has resurfaced. Moreover, these visible price changes have already altered central banks' rate-cut expectations, with long-term debt concerns giving way to short-term rate-hike shocks. Pricing of risk assets like gold is clearly no longer based on long-term considerations.

Second, PMI data indicates notable expansion in new orders. China's manufacturing purchasing managers' index (PMI) rose from a four-month low of 49.2% in July to 49.8% in August. The production index reached 50.4%, up 0.5 percentage points from the previous month, indicating accelerated manufacturing activity. The new orders index hit 50.6%, up 2.1 percentage points, signaling a clear improvement in manufacturing demand.

Third, policy remains steady, with no signs of super-sized stimulus. The K-shaped economic divergence is a result of industrial transformation, and investors must face the macro reality that structure matters more than aggregate volume. From August 22 to 25, the People's Daily published a series of four articles under the pseudonym "Zhong Caiwen," offering in-depth analysis of China's economic conditions and outlook. The main thrust moves from assessing the current state (resilience and vitality), to examining external factors (stability anchor), to dissecting data (a deep dive into the 4.7% growth rate), and finally to implementation (policy measures in the second half). The message is clear: prioritize growth quality, adhere to counter-cyclical adjustments, prevent systemic risks, and maintain long-term strategic focus, making the likelihood of short-term massive stimulus very low.

Investment Strategy: Awaiting the Market's Endogenous Power

We maintain our previous view that a secondary ignition will follow the rebound, but this process requires time. Until new fundamental and sentiment signals emerge, positioning should be guided by market differentiation. The current strategy favors macro trading over allocation, prioritizing the short term over the long term, and earnings over narratives. Many investors look forward to "deep autumn love," and we answer affirmatively: the tech rally in the fourth quarter is still on the cards. Given sufficient time for adjustment, the market will ignite on its own without needing an external spark. This endogenous power stems from corporate earnings, which in turn are driven by growth differentiation.