King of Capital

Chapter 10 Question Macro Analysis
The meeting room was not large. Four instructors, including Su He, sat in a row, with eight interns sitting on both sides.

Let me first briefly explain the internship rules: one month of internship, six rounds of assessments, and the last-in-first-out system, with only three people remaining.

After the first round of assessment, each instructor will select two interns to supervise, and the selection will be two-way.

After explaining the rules, a cross-border morning meeting to formally analyze the macroeconomic situation was held, chaired by a teaching instructor from Juntai Research Institute, and attended online by Hong Kong and colleagues from the New York office.

This kind of morning meeting is no different from real estate salesmen dancing and singing motivational songs before work in the morning. A few big guys express their opinions and chat ramblingly about macro and the day's hot financial news, and the people below have an idea of ​​what's going on while they work.

For many interns present, the focus of the conference was on "transnationality", which tested their English listening skills.

"I need each of you to prepare a 'meeting minutes'. Is that ok?"

Sure enough, during the break of the online meeting, Su He casually issued the task.

In the individual battle, Stanford asked Wang eagerly: "Do you want it translated into Chinese, or bilingual?"

"As long as people can understand it."

Su He's implication was that if I don't understand, you will die.

Forcing Wang to go to her office privately to introduce herself just now committed the same taboo as Xie Jingxing, praising her for looking young and not looking like she had been in the industry for more than ten years.

She didn't like to hear this, as she had only been in the industry for a little over ten years, less than fifteen years.

Peking University graduate student Xue Haoran skillfully turned on the recording on his phone and said to Feng Shuo, who was sitting next to him, "Let's work together. You mainly record the English part, and I'll record the Chinese part."

"Smart." Feng Shuo nodded vigorously.

He had no other advantages except for his sea turtle background, and the first quiz happened to be his strong point, so he had to try to get a high score.

Zhao Mengche was inspired and wanted to do the same thing. Xie Jingxing didn't care and asked, "Are you sure you can remember the Chinese part?"

"…That should be possible, right?" she asked back, blinking her eyes.

The girl from Pengcheng took advantage of the situation and decisively said to Xie Jingxing: "How about I take the English part and you take the Chinese part? My TOEFL score is 107."

Zhao Mengche was stunned for a moment. Just as he reacted and wanted to say something, the big screen successfully connected to the online meeting.

The institute's instructor spoke first:

"Let me first talk about our domestic situation. Judging from the short-term economic operation and development trend, my country's macroeconomic performance in the first half of this year basically declared the failure of the "domestic collapse theory in 2013" held by global pessimists. Whether the "domestic cycle reversal theory" can be realized in the second half of the year still needs in-depth analysis..."

The first two sentences in Chinese made Zhao Mengche and the girl from Pengcheng run at an idle speed. They had no time to compete and play games. They just kept typing away on the keyboard.

How can the school textbooks be updated so quickly? They haven’t learned these in class. At most, the teacher just mentioned them a few words.

The instructor at the Shangshou Institute continued, "Compared with other years, 2013 has the following characteristics that deserve attention."

“1. The continued reversal of global imbalances still puts a relatively obvious pressure on China’s structural adjustment, and the contribution of external demand to GDP remains negative.”

"2. The obvious decline in income growth has led to weak consumption in the first half of this year, with a large decline in growth. Instead of shifting from the pre-crisis 'export-investment driven model' to a 'consumption-domestic demand driven model', it has shifted to a 'credit-investment driven model'."

"The stability of domestic demand depends on the expansion of credit and investment, and the sustainability is further weakened..."

At this point, Stanford was really pushing Wang Renzhuan to the limit. The bigwigs at the research institute were too aggressive. Before he could even get a chance to speak English, his native Chinese language overflowed into his mouth.

Xue Haoran licked his lips with sweat all over his forehead, and nodded his chin repeatedly to signal Feng Shuo to take notes as well and not to rely on him for everything.

The girl from Pengcheng seemed relaxed and wrote down every word she heard.

Zhao Mengche had completely stopped recording, and asked softly while holding his fingers, "Why don't you remember?"

"It turns out that you don't seem to remember Chinese."

Xie Jingxing responded casually, thinking whether he could really speak these analyses in front of the camera, he was indeed Juntai.

"I recorded it."

Zhao Mengche pretended to hit the Enter key twice and then the Delete key twice, pretending that she was trying hard to keep up with the progress.

'Minutes of the meeting' is a hurdle that almost all new financial professionals cannot avoid when they first enter the industry. When you can write the minutes of the meeting clearly, you will have a comprehensive understanding of the working style of your department and most of the routine business.

However, the fact is that many analysts and project managers (A/SA) who have been in the industry for two or three years cannot write meeting minutes clearly, and they can only be used as "meeting records".

It's like a person saying: I had eggs for breakfast.

Writing down this sentence verbatim is the "minutes of the meeting"; writing down this sentence with the four words "breakfast eggs" emphasized in bold and highlighted so that even a layman can distinguish the main points is the "minutes of the meeting".

When Zhao Mengche tried to distinguish what was breakfast and what was eggs, the head of the institute had already talked about having pork elbow for lunch. Naturally, she couldn't keep up with the pace and couldn't even write the "meeting minutes".

The same is true for others. As for the carefree girl from Pengcheng, she is a good candidate for a stenographer because of her fast typing speed. It would be a waste for her to work in finance.

While Xie Jingxing was taking the 'meeting minutes', he observed everyone's status with ease. During this time, only the New York office analyst spoke in English with a thick French accent, which made him sweat a little.

The arrogant French stubbornly insist that French is the best-sounding language in the world and they disdain to change their accent. Therefore, French English is very challenging to listening skills and is on the same level as Indian spoken English.

The meeting finally ended after more than an hour. Zhao Mengche held her face in her hands and sat in a classic little princess posture out of boredom. Xue Haoran and Feng Shuo stopped praising each other for being "smart" in a non-commercial way and stared at the screen in a daze with their brows downcast.

Stanford forced Wang to look around, wondering if he would be the worst; the Pengcheng girl was still typing away on the keyboard, it seemed that she not only typed fast, but also had a good memory and a lot of strength.

"I'll give everyone thirty minutes to organize it. It will be distributed to the email addresses of all the instructors at 11:30. Is that ok?" Su He announced the death deadline.

She spoke in an interrogative tone the whole time. Is there any problem with taking meeting minutes? If there is a problem, are you a waste?

As long as people can understand it, it’s fine. If they can’t, are you a waste? Thirty minutes is enough, right? If it’s not enough, are you a waste?

The strong sense of oppression made the interns unwilling to bargain. They filed out in a huff and returned to the office area, ready to struggle a little longer before the death deadline.

…………

"What was said in the English part? The French accent was so strong that I couldn't hear it clearly." The girl from Pengcheng was anxiously looking for someone to check the answer.

Feng Shuo was unable to respond, and he didn't hear it clearly.

Stanford Bi Wang sighed bitterly: "It roughly talked about the recovery of the US stock market and real estate in the first half of 2013, as well as moderate job growth, but the government's automatic spending cuts may continue to affect the economy's consumer confidence and corporate investment confidence."

"You can understand this, that's amazing."

Feng Shuo's mind was so confused that he couldn't even remember the English phrase "cut spending".

Stanford forced Wang to smile: "I interned at the West African Development Bank (BOAD), there are many French people there."

If it was before the meeting, he would show off this, but after the meeting, he would be left with only bitterness and confusion.

"There are two more aspects. The eurozone is expected to recover economically in the second half of this year, and the domestic GDP growth in the second half of the year is likely to enter a relatively low growth track," Xie Jingxing added.

Feng Shuo's head twitched and he asked, "You lived and ate with your French teacher for three years?"

"Most English words have the same roots as French words, and they all have Latin roots. If you know French, it won't be hard to understand the accent of my New York colleague. I took the theology elective in college and happened to have learned a little Latin."

Xie Jingxing took off his suit jacket and tie: "I forgot to tell you, in addition to eating and living with the teacher, getting an 8.5 in the IELTS test requires a little language talent."

"You, Xue Haoran, Zhao Mengche, and that one..." He looked at the girl from Pengcheng.

The latter nodded smartly: "Song Anli, the pear for Xiaodiao Pear Soup."

"Yes, An Li, you guys come with me, I will help you sort out the key points in ten minutes." Xie Jingxing picked up the computer and turned around and left.

Zhao Mengche followed decisively, holding two computers and a recorder in his hand. Song Anli hesitated for two seconds, ignored the gazes of the three people from Beijing, and trotted after them in her high heels.

They arrived at the luxurious tea room for lunch break and each found a place to sit down. Xue Haoran did not come with them. Feng Shuo, who arrived last and was slow, helped explain that he was organizing the recordings.

Xie Jingxing pretended not to hear and automatically ignored it. He glanced at his watch, pulled over a whiteboard and started talking directly: "The focus of today's morning meeting is two words, 'credit-investment driven model' and 'sustainable domestic demand'."

"Time is limited, and there is no need to elaborate on the basic concept that investment, consumption and exports are the three driving forces of economic growth."

"The first point mentioned in the meeting just now: the contribution of external demand and exports to GDP is still negative. There are two key points here. First, the economies of developed countries have not fundamentally improved since the financial crisis in 08. Second, the situation in emerging economies continues to deteriorate..."

The content of the meeting involved a wide range of macro-analyses that were complex and complex, and time was limited so it was impossible to explain everything clearly. Xie Jingming could only pick out the key points and stuff them into their heads.

The financial crisis in 08 came first, followed by the European debt crisis, which had a huge impact on the domestic economic growth in the export and external demand sectors. As a result, the country turned to domestic demand in the hope of expanding domestic consumption to fill the gap in exports.

The problem is that due to the financial crisis, the income of domestic residents has been growing slowly in recent years, and ordinary people have no money to spend. Correspondingly, problems such as "overcapacity" and "liquidity overflow" continue to worsen.

Exports continue to be sluggish and consumption cannot be driven.

Amid numerous problems, the general trend of the domestic economy has not been changed by personal will and has embarked on the "credit-investment driven model" mentioned by the head of the research institute.

A few months ago, Chinese middle-aged women went on a gold buying spree to battle the Wall Street short sellers. Now comes the upcoming leveraged bull market in the stock market from 2013 to 2015, and the wild growth of Internet financial platforms from now on.

These are the results of the "credit-investment driven model" that are most easily accessible to the public. Liquidity is overflowing, and private hot money has nowhere to go. It swarms into a certain industry like a speculator, until the entire industry is killed, and then everything is in a mess.

Excessive liquidity and overcapacity are both legacy issues of the 08 financial crisis.

This is also the reason why Xie Jingxing couldn't help but hesitate when the head of the research institute said that "the stability of domestic demand depends on the expansion of credit and investment, and sustainability is 'further' weakened."

Because the big guy has real evidence and his analysis is very impressive. In his opinion, the phrase "sustainability is further weakened" is a dirty word, and it is a very unpleasant one at that.

He had foresight about the financial trends in the next decade or so, and with more than ten years of work experience in the financial industry, he was able to easily piece together these highly interconnected causes and consequences, and instantly realized that the boss was cursing.

Other interns have no problem analyzing various financial historical cases with the knowledge they learned in school, but expecting them to fully comprehend the current macroeconomic logic that is in dynamic development and grasp the key points to distinguish the primary from the secondary is no less than asking Zhu Bajie to distinguish between his own senior brother and the six-eared macaque.

Education has a lag. The fact that these interns attend prestigious universities proves that they are smart and have strong learning abilities. However, in terms of practical ability, most of them don't understand finance as well as the auntie selling fried pancakes downstairs of the office building in Lujiazui.

Just like the new recruits going out for training exercises do not have as strong reconnaissance capabilities as the comrades who push supply trucks and sell goods, they still need to practice.

Moreover, the deeper meaning and final conclusions expressed by the head of the research institute are not limited to the two points of "credit-investment driven model" and "sustainable domestic demand".

What he really wanted to express was that the country can only follow the "credit-investment driven model" route at present, and many problems cannot be solved overnight.

It is impossible to say such words directly and record them in the "minutes of the meeting". One can only rely on personal understanding to understand the current macro situation. Not to mention the interns, even Su He, a mentor in investment banking, may not fully understand the macro analysis of the head of the research institute.

Xie Jingxing helped several interns explain these things in order to give them a clear understanding of the difficulty of the exam questions. This one-month internship has a lower limit but no upper limit.

The lower limit of today's test questions is writing "meeting minutes" and English proficiency, and the upper limit is macroeconomic analysis ability.

The 'minutes of the meeting' are written fairly well, and as long as your English ability is not too bad, you'll pass. As for the rest, your understanding of the macro-economy and how many key points you can grasp will all be extra points.

In other words, if you really perform well, Juntai will still beg you to stay after the show. So there can be less internal competition, and he doesn't mind taking a few interns with him.

Thanks to her fast typing speed and good memory, Song Anli was the first to follow Xie Jingxing's train of thought, sorting out the logic and summarizing the key information.

Zhao Mengche still wasn't very smart, and he was struggling to follow the rhythm intermittently.

Feng Shuo was still listening attentively. He majored in biology in undergraduate studies, and switched to finance when he went abroad to study as a graduate student. His foundation was the worst among the eight interns, and he had trouble understanding many professional terms.

He wanted to ask a question but was too embarrassed. Xie Jingxing was very similar to Su He at this moment. It seemed that he would blurt out "I fed it all into your mouth, and you still don't understand. Are you a waste?" in the next second.
　Reference: "China's Macroeconomic Analysis and Forecast from 2013 to 2014" by the Institute of Economics, Renmin University of China
　　"World Economic Situation and Prospects Mid-2013" United Nations Department of Economic and Social Affairs
　　"Report of the Institute of Financial and Economic Strategy of the Chinese Academy of Social Sciences: China's Macroeconomic Operation Report (2013-2014)" Liu Yingqiu/Lv Fengyong (Editor-in-Chief)
　　
　
(End of this chapter)