2012 monetary policy has a big impact on the cement industry

After the Central Political Bureau meeting was set on December 9th, the suspense of the upcoming central economic work has already landed.

According to Ba Shusong, deputy director of the Development Research Center of the State Council’s Institute of Finance and Economics, 2012 will see a soft landing of normalized GDP, and the economy will experience a declining inertia. The GDP growth rate will rebound moderately in the first and second quarters of next year; The Chinese economy will be transformed from high-speed growth to long-term growth.

"The combination of GDP and CPI will enter the '8+4' era from the past '10+2' era, that is, China's economic growth will gradually enter the 8% and 4% times in the future," said Ba Shusong.

On December 9, the Central Political Bureau meeting, which has always been regarded as a preliminary adjustment meeting, was convened to determine the direction of macro-control in 2012, ie, the two keynotes of “proactive” fiscal policy and “steady monetary policy” remain unchanged.

However, in the past ten years, except for the “tight” in 2007 and the “moderately loose” in 2008, the monetary policy adjustment in most years was basically “robust”. In addition to adopting a "steady" tone in 2004-2007, fiscal policy is "positive" in other years. Therefore, how to interpret the policy information contained in "steadiness" and "positive" is particularly important.

At the Central Economic Work Conference, it will further refine the many goals such as economic growth, inflation, money supply, and new growth in the coming year. Authorities close to the macro-control department have disclosed that after experiencing relative contraction in 2011, the number of new people added in 2012 will be about 8 trillion yuan, while the broad money M2 may be about 14%. 16%.”

People in the cement industry stated that the preliminary macroeconomic adjustment in 2012, taking a neutral path, means that domestic investment will slow down in 2012, which will have an important impact on the cement industry.

Neutral monetary policy In 2012, the monetary policy was set to be “steady”. However, the term “stable” has been biased and loose in different years. Compared with the relatively tight monetary contraction situation in 2011, where will monetary policy in 2012 go?

According to Ba Shusong’s understanding, next year’s monetary policy will be “steady”, and its internal meaning is neutral, non-stimulating, and not expanding. “We must put the positive forces and the task of structural adjustment on fiscal policy.”

From the end of the year to the end of the year, the tightening intensity of the domestic economy and the rate of economic decline were close to those at the end of 2008. At that time, the M1 growth rate once fell to around 8%, which is even lower than the current level of 9%. Behind the monetary policy is the increasingly gloomy economic trend at home and abroad.

"In an environment of weak global growth and loosening of currencies, even if prices do not fall back in the short term next year, China is unlikely to have unilaterally made large-scale austerity." Ba Shusong's remarks can be used to interpret current monetary policy tone. The basic logic behind.

Assuming that the number of new people added in 2011 will be around 7.5 trillion yuan, of which 5 trillion credit will be invested in infrastructure, and with the elimination of matching funds, the number of new people in the society will still be less than 3 trillion yuan. "In this case, it is very difficult for companies, especially SMEs, to get money."

However, the choice and logic of today's monetary policy are quite different from those of three years ago. A senior banker admits to this reporter that under the background that domestic commercial banks' loan-to-deposit ratios are close to more than 75% high-voltage lines and capital adequacy ratios continue to fall, they are "very worried that there will be no 8 trillion yuan worth of supplies next year."

According to the statistics of CICC, the overall loan-to-deposit ratio of commercial banks at present is as high as 67%, and the loan-to-deposit ratio of some joint-stock banks and small banks is already close to 75%. Ba Shusong said: "If 75% of the bottom line is not carved, the bank can not absorb new sources of funding, even if the scale restrictions are abolished, the bank can not put money."

Credit Challenges Face Structural Challenges In view of the bankers mentioned above, the realistic basis for supporting commercial banks’ rapid credit supply has changed. “In 2012, it is impossible to make another round of 'four trillion' investment plans, and four trillion plans have driven 9.95 trillion in 2009 and 7.95 trillion in credit in 2010."

Ba Shusong also believes that, in view of actual demand, infrastructure investment demand has basically been well met in the investment frenzy in 2008. “After two or three years, the projects that have already started are not yet over and the infrastructure will be reopened. Is not realistic."

A middle-level CBRC official stated frankly at the Jiuhua Resort conference convened by the National Research Center in late November that nearly 6 trillion yuan was newly added in 2009, and 6 trillion yuan was spent on infrastructure in order to tie in with the “4 trillion” plan. "The project investment is generally a parabolic trend. The first year is not the maximum, and it gradually rises in the second year and then gradually declines."

From this point of view, even with the parallel line model, the number of people investing in infrastructure in 2010 was around 6 trillion yuan, which means that out of the 7.9 trillion yuan newly added in the year, only 1.9 trillion was invested in SMEs, etc. entity.

"On the one hand, the amount of credit is very large. On the other hand, SMEs can hardly get a bank, and the entire society will inevitably lack money." The above-mentioned regulatory officials said that this could also explain the total currency since 2010, especially since 2011. There is a structural malaise in which both quantity and currency are coexisting, liquidity is raging, and liquidity is in short supply. "Once it becomes a structural issue, it is very difficult to solve it. Even if monetary policy is relaxed next year, if the credit structure is not adjusted, companies will still not be able to obtain the money and the funds of the enterprise will remain tight." The above regulatory official pointed out.