<h2>Q1: Kevin Warsh has been nominated as the Chairman of the Federal Reserve, and there have been many twists and turns. Does this mean the Federal Reserve is entering a new phase? Is this beyond your expectations?</h2>
Zhou Hao: I am one of the few analysts in the market who believes that Kevin Warsh will be elected as the new Chairman of the Federal Reserve, for two reasons:
First, Hassett is not suitable to be the Chairman of the Federal Reserve. Although Hassett has a close relationship with Trump, he lacks an economics background and is more like a spokesperson. Although Powell also does not have an economics background, the era we are in is different; at that time, the market believed that the Federal Reserve was a stable institution, and it didn't matter who took the position.
But the current environment is different, with increased global economic uncertainty, and it is becoming increasingly difficult for academia to predict the economy. If the Federal Reserve is still led by a &#34;professional manager,&#34; how can we convince the market?
Second, other candidates mentioned in the market, such as Waller, have too little influence; if you don't read every voting committee member's articles, you might not even know who he is. Warsh, on the other hand, meets the needs of this era, possessing an academic background and a deep understanding of the Federal Reserve, and can lead the Federal Reserve in addressing the current complex situation. His nomination can be seen as an inevitable choice of the times.
<h2>Q2: The &#34;Warsh trade&#34; has been widely discussed in the market. What is your view on this concept? Is it a result of market sentiment or does it represent reasonable market pricing?</h2>
Zhou Hao: I believe the &#34;Warsh trade&#34; is more of a market overreaction rather than reasonable pricing.
Warsh's election will not immediately trigger a dramatic change; his influence will be medium to long-term. For example, gold has risen 6.6% from the beginning of the year to now, and even with the recent sharp decline, it reflects the accumulation of market positions.
The fundamental reason for the sharp decline is actually that no one is buying anymore; everyone who should buy has already bought, and the remaining fluctuations are essentially the market &#34;washing out&#34; positions.
The &#34;Warsh trade&#34; is more like the market's &#34;washing,&#34; rather than Warsh's own label. Market sentiment and position adjustments are the greater driving forces.
The role of the Federal Reserve Chairman is a slow variable, not a factor that changes rapidly in the short term. Warsh's influence is medium to long-term, and the short-term volatility in the market is more a result of overtrading and position adjustments rather than a direct push from Warsh.
<h2>Q3: Since you believe the &#34;Warsh trade&#34; is more sentiment-driven, will this sentiment gradually cool down? Or will it continue to ferment and have a greater impact on global asset pricing?</h2>
Zhou Hao: This is a great question. I want to give an example: when Trump was elected in 2016, I had already written an article titled &#34;The Black Swan Has Taken Flight,&#34; and then I woke up to find the stock market rebounding across the board.
The market always has excessive rebounds after excessive sell-offs, and it is difficult for us to judge this situation in the short term. The impact of the &#34;Warsh trade&#34; may also just be short-term fluctuations after the market overreacts. But whether this fluctuation will persist, time will give us the answer.
What we really need to pay attention to is how the specific policies adopted after Warsh takes office will affect global asset prices; we cannot simply judge based on interest rate cuts and balance sheet reductions
<h2>Q4: Should the plunge in precious metals be blamed on Walsh?</h2>
Zhou Hao: People always like to find someone to &#34;blame.&#34; When making money, no one thanks the person who deserves praise, but when losing money, everyone wants to find a reason.
I believe there is no need for excessive attribution. In the face of severe market fluctuations, it is important to reflect on one's trading skills and risk control abilities.
Indeed, some people lose money, while others make a lot, but what really matters is how you respond in such a volatile market.
It's like when a gust of wind comes, everyone feels they are on the windward side, but those truly on the windward side are often the assets with the strongest fundamentals. For example, Nvidia once performed very well, and Super Micro Computer (SMCI) briefly surpassed Nvidia, but now Nvidia's stock price remains high while Super Micro Computer has halved.
This indicates that not all &#34;windfalls&#34; can bring long-term gains; truly stable assets are those with the strongest fundamentals, while overly traded small stocks often experience significant volatility.
Therefore, everyone needs to maintain a sense of awe towards the financial market, while reflecting on their trading habits to ensure proper long-term risk control and position management.
<h2>Q5: Gold has broken through the new high of 5500. Do you think this marks the beginning of a new era for gold, or has the gold price reached its ceiling?</h2>
Zhou Hao: Let me use Nvidia as an example again: when Nvidia's stock price rose from 60 to 100, everyone thought it was already very high, but the stock price eventually returned to 60. Many people began to ask if 100 was the top. In fact, the issue with gold is very similar.
Gold has entered a new structural narrative phase, and judging its peak is of little significance. Even if a major correction occurs, whether this correction point is the historical high for gold ultimately depends on whether the story of gold continues. As long as the story of gold is not over, the peak is not fixed.
I believe gold is still in a new narrative, which may not be as disruptive as AI technology, but its impact is a reconstruction of our psychological sense of security.
Therefore, the future trend of gold is still worth looking forward to, and everyone needs to be patient. At the same time, whether to agree with the long-term narrative of gold is a core question that every investor needs to consider.
<h2>Q6: With the significant adjustment in gold prices, do you think it's better to wait for volatility to decrease before entering the market, or is now the time to buy the dip?</h2>
Zhou Hao: The perspective of investors is indeed different. After a sharp decline, there will always be someone deciding to buy the dip, which is not surprising. Just like when my wife and I discuss buying something, I might suggest she not buy it now, but she will always make her own decision based on her judgment. So, buying the dip is a matter of personal judgment, and everyone has different strategies and risk tolerances.
Regarding gold, from the current state, it is more appropriate to judge through technical analysis. The fundamental narrative is difficult to convince people in the short term; they have already absorbed it quite well, and the plunge is essentially the market's trading logic.
We can refer to the support levels for gold, such as the Fibonacci retracement levels, which are important indicators. If you have a longer time perspective to assess this market, the price becomes less important because the gold market is one that requires long-term patience for investment
I suggest that those itchy investors should enter and exit quickly, while those who are not in a hurry can patiently wait for market volatility to decrease before making judgments. If you have spare money and can hold long-term, then you can enter at a price you deem appropriate.
<h2>Q7: Do you think gold investment can be more patient, and how should the specific timing be grasped?</h2>
Zhou Hao: This is actually quite simple. Changes in market sentiment can often be perceived from changes in the volume of information. When the push notifications are no longer frequent, the sentiment usually stabilizes.
For specific entry timing, we can judge through the technical aspects of gold. For example, the Fibonacci levels of gold are important support points. If the gold trend is upward, the appearance of key support levels usually provides strong entry opportunities.
Additionally, one can wait for a period, such as a month, do their homework, and find a more comfortable entry point.
The fundamental judgment is—whether one agrees with the structural bullish logic of gold. If so, one can patiently wait for the appropriate timing.
<h2>Q8: Walsh advocates for interest rate cuts while also conducting balance sheet reduction. Do you think this can be achieved? Will there be some practical constraints?</h2>
Zhou Hao: This is indeed a practical issue. Like Trump, Walsh cannot do whatever he wants; many actions cannot be implemented immediately.
Walsh faces many practical constraints, but he has indeed made the Federal Reserve more independent, which is important. How to explain this independence?
The independence of the Federal Reserve is reflected in its ability to make decisions based on its own judgment, rather than being influenced by the president. Walsh hopes the Federal Reserve maintains a certain independence in its relationship with the private sector or other public sectors, avoiding being too tightly bound to the Treasury and capital markets; otherwise, many decisions cannot be implemented.
Walsh's goal is to create a disconnect between the Federal Reserve and other departments, ensuring the possibility of independent thinking and action.
What Walsh wants to do is to isolate himself a bit from the world, turning himself into an &#34;island&#34; to facilitate independent thinking and action. This will certainly face many obstacles, but like Trump, whether he can ultimately change the world, everyone will come to their own conclusions.
<h2>Q9: Some opinions compare Walsh with Volcker. Do you think there is comparability between the two?</h2>
Zhou Hao: I do not think the two are comparable.
Volcker established the independence of the Federal Reserve without prior knowledge and only realized this after many trials and errors. Today, all our understanding of central bank independence comes from Volcker's 10-year battle against inflation.
The independence of Volcker's time was realized through practice, but today's era is different from that time. The independence that Walsh pursues is to maintain distance between the Federal Reserve and other fields, especially the Treasury and capital markets. This form of independence, although also stemming from reform, is not the same as Volcker's approach.
Therefore, although both Walsh and Volcker served as chairmen of the Federal Reserve during times of reform, it cannot be simply compared using &#34;independence,&#34; especially from the perspective of interest rate policy, as they face completely different challenges and approaches
<h2>Q10: What specific actions do you think Walsh will take after taking office, and how will these actions affect the pricing of various global assets?</h2>
Zhou Hao: After Walsh takes office, he may not openly express his true thoughts, but he has already clearly indicated the direction—inflation is the policy choice of the Federal Reserve.
This means that anti-inflation is the only KPI for the Federal Reserve, rather than allowing it to develop unchecked.
Walsh's job will be to balance the relationship between financial stability and anti-inflation. It is not ruled out that after significant market fluctuations, he may come out to say some reassuring words to the market, nor is it ruled out that he will continue to maintain a tough stance during a market downturn. This does not mean he has abandoned his policy options, but rather that he believes which statement can better express authority over the market at that moment.
If you don't make the market fear you, then you are not qualified to be the chairman of the Federal Reserve. Either make the market like you very much, or make the market fear you very much, I believe Walsh will make a choice between the two.
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Waller has been nominated as the Chairman of the Federal Reserve, and analyst Zhou Hao believes this marks a new phase for the Federal Reserve. He pointed out that Waller has an academic background and is capable of addressing the current economic uncertainties. Zhou Hao believes the market's reaction to the "Waller trade" is excessive, and the short-term volatility is more a result of market sentiment and position adjustments rather than Waller's direct influence. He expects Waller's impact to be medium to long-term

- Kevin Warsh's nomination as the Fed Chair raises questions about whether the Fed is entering a new phase, as he has an academic background better suited to current economic uncertainties.  
- The so-called "Warsh trade" is viewed as a market overreaction rather than rational pricing, with his true influence expected to manifest in the medium to long term.  
- Investors are advised to focus on the upcoming policies of Warsh and how they will shape global asset prices, emphasizing the need for patience and caution in volatile markets.

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Will anti-inflation measures boost gold to new highs? Zhou Hao: The Federal Reserve Chairman must either instill fear in the market or make the market reliant