Jinze 金泽

Jinze 金泽

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Here are my reading notes NOT financial advice. Now @MuseLabs1 +LD Research. Prev. Binance Research, WallStreetCN, EY.

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Consumers' actions contradict their words: Despite low consumer confidence, retail sales growth has remained relatively stable. This suggests that actual consumer behavior is more optimistic than the pessimism expressed. Deutsche Bank points out that objective market data should be given greater weight than subjective sentiment indicators. The statements of CEOs and consumers may lag behind or exaggerate the actual situation.

Reasons for the recent divergence between interest rate and stock market signals: Paradoxical phenomenon: The S&P 500 hit a record high, but interest rate markets are pricing in more Federal Reserve rate cuts, and the 10-year Treasury yield continues to decline.

Hedge funds are frantically increasing their holdings in tech stocks, reaching a seven-month high, while simultaneously selling cyclical stocks for six consecutive weeks. While the broader market is trending upward, most of the money isn't pouring into the stock market. Instead, it's flowing into very conservative fixed income investments. It seems like this is a classic "bull market for the few"—

Everyone's talking about AI's power consumption, but AI's water consumption may be a major issue the market hasn't yet noticed. I just read a Morgan Stanley research report discussing this issue. Some startling statistics: 11-fold growth: By 2028, AI data centers are projected to consume 1.068 trillion liters of water annually, 11 times the amount in 2024. "Invisible" consumption: This isn't just water used for server cooling (Scope 1). A larger portion is the water needed to power them (Scope 2). Chip manufacturing (Scope 3) is also a significant water consumer. Supply shortage: Crucially, more than half of the world's major data centers are located in regions with "moderate water scarcity risk." AI water consumption is "small in absolute terms but growing rapidly, with significant regional supply chain risks." Water is becoming a bottleneck for AI infrastructure, just as critical as electricity. It seems that Bitcoin mines also have water problems. A study in 2023 showed that cryptocurrency mining consumes 1.859 billion tons of water annually (1 ton per capita per month, equivalent to the annual water consumption of 150 million people), and it is expected to increase sixfold by 2030.

"Goldman Sachs: Divergence Between Cryptocurrencies and Stocks Signals Impending Liquidity Risk" GS: The current global stock market rally is significantly disconnected from the performance of the real economy, as evidenced by the fact that the correlation between macroeconomics and markets in both China and the United States has fallen to multi-year lows. Driving Force: This suggests that the primary driver of the stock market rally is not cyclical improvements in economic fundamentals, but rather liquidity factors and valuation expansion. Simply put, it is "hot money" in the market that is driving asset prices higher, rather than actual support from corporate earnings and economic growth. Implications: This liquidity-driven rally is typically fragile. Once the liquidity environment changes (such as central bank tightening), the market may face the risk of a sharp correction. Goldman Sachs points out the following risks to be vigilant: Liquidity Tightening Risk: With the rebuilding of the U.S. Treasury General Account (TGA) and the depletion of reverse repurchase facility (RRP) balances, liquidity in the financial system is about to be drained. Goldman Sachs believes that the weakness of cryptocurrencies relative to stock indices may be an early response to this liquidity risk. Technical warning signs: The market currently lacks incremental buying from volatility control funds (vol-control) or trend-following strategies (CTAs). Meanwhile, short positions in the VIX (Volatility Index) are extremely crowded, meaning that if a negative catalyst emerges, a large amount of short covering could quickly amplify the market's decline and lead to a sharp correction.

CME Ethereum Futures Leveraged Fund's Net Short Positions Surged by 50% Last Week

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