Interest rate cuts are on the horizon, as Goldman Sachs "elite troops" gather in Asia-Pacific, where will Chinese assets go?

On September 19, 2024, at 2 a.m. Beijing time, the Federal Reserve announced a 50 basis point interest rate cut, ending a four-year cycle of rate hikes.

This news is like a bombshell, instantly detonating the global financial market.

On social media, netizens are speculating: with the Fed's rate cut, will dollar capital really come to China?

On the surface, the Fed's rate cut is to stimulate economic growth and alleviate inflationary pressures, but it reflects the complex situation of the global economy.

Over the past few years, the United States has attracted a large amount of international capital inflows through continuous rate hikes, enhancing the attractiveness of the dollar.

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However, this approach has also led to instability in the global financial market, and many countries' economies have been severely impacted.

Now, the Fed's rate cut means that the United States recognizes the severity of the global economic situation and has to adjust its policies to deal with potential risks.

In the face of the Fed's rate cut, many people believe that dollar capital will not come to China on a large scale.

Does this view really stand up?

If everyone thinks this way, it's just what American politicians want.

From historical experience, no American government can control capitalists.

If Washington really controlled them, it wouldn't be free capitalism.

As the saying goes: "Capital is profit-seeking, and like water, it always flows to the low-lying areas."

American politicians can try to limit the flow of some capital, but they absolutely cannot control the direction of the entire capital market.

Moreover, the real big players in capital have ways to bypass various restrictions and find the best investment opportunities.

Recently, a series of moves by Goldman Sachs have attracted high attention in the industry.

On September 18, it was reported that Goldman Sachs made significant personnel adjustments to the Asia-Pacific region, sending three senior mergers and acquisitions experts to the Asia-Pacific region: Raghav Maliah, Ed Wittig, and Yoshihiko Yano, who jointly serve as co-heads of Goldman Sachs' M&A business in the Asia-Pacific region.

These three joined Goldman Sachs in 1995, 2001, and 1998, respectively, and have served the company for more than 20 years.

Among them, Ed Wittig was responsible for M&A projects with a transaction amount of $14.95 billion in 2023, ranking among the top 50 global M&A bankers.

Why did Goldman Sachs make such a significant personnel adjustment at this time?

The answer is obvious: to bottom-fish Chinese assets!

After the dollar rate cut, the most economically active Asia-Pacific region will become the focus of capitalists.

Especially after the Asian currency devaluation storm in the first half of this year, the asset prices in Asia have been at a low point, which is the best time to bottom-fish.

Historically, the path of dollar capital in China has not been smooth sailing.

During the 1997 Asian financial crisis, asset prices in many countries fell sharply, and dollar capital took the opportunity to acquire a large number of high-quality assets at low prices.

China demonstrated strong resistance in that crisis and successfully withstood external shocks.

In recent years, China has made significant progress in opening up to the outside world.

In 2023, China lifted restrictions on foreign investment in the banking and insurance industries, and not long ago, it relaxed investment restrictions in manufacturing and foreign-funded hospitals.

These measures have not only attracted a large amount of foreign capital but also provided more cooperation opportunities for domestic enterprises.

This also means that the investment environment for dollar capital in China has become more complex.

China is fully prepared for the influx of dollar capital.

Accelerating the pace of opening up.

For example, Sinopec Capital, as a member of the investment group, participated in the privatization acquisition of the NASDAQ-listed Chinese concept stock company, Heli Shi Automation Technology Co., Ltd., and completed the delivery.

This shows that Chinese state-owned capital has begun to actively participate in market competition and become a strong opponent of dollar capital.

Regulatory authorities have conducted more rigorous reviews.

In the past, China had many loopholes in foreign investment review, but now we have learned how to better manage foreign capital.

In 2023, the China Securities Regulatory Commission strengthened the review of foreign investment mergers and acquisitions to ensure that foreign investment is in line with national interests.

Chinese enterprises have also shown strong competitiveness in the face of foreign acquisition.

For example, Chinese paper industry giant Vida was acquired by Singapore's Golden Eagle Group for 26.1 billion Hong Kong dollars, but before that, Vida had improved its market position through a series of strategic adjustments.

Hong Kong-listed companies Samsonite and Li Ning have also successively reported being acquired, but these companies still have strong brand influence and market share in the local market.

The dollar rate cut is undoubtedly a double-edged sword.

If handled properly, China can promote further economic development by attracting foreign capital; if handled improperly, it may also face excessive harvesting by foreign capital.

Therefore, we need to remain vigilant, but we cannot refuse to eat for fear of choking.

High-level opening up is China's unwavering choice, and we cannot regard all foreign capital as a flood and beast.

The influx of dollar capital, China is fully prepared.

The active participation of state-owned capital and the strict review by regulatory authorities will provide a strong guarantee for the healthy development of China's economy.

Will the dollar rate cut really bring the spring of the economy?

It depends on how we respond to challenges and seize opportunities.

Friends, the wind of the dollar rate cut has blown, and the elite troops of international financial giants such as Goldman Sachs are also in place.

This is a war without smoke, but it also tests our wisdom and courage.

The battle to defend Chinese assets has already begun quietly.

Are you ready?

Do you choose to be a bystander who watches coldly, or become a brave warrior in this battle?