America's Road to Wealth

Chapter 189 The first confrontation with Wall Street

This time I returned to New York from my hometown of Texas.

To be honest, Abel was not in a pretty mood.

Lian Yisha's Christmas Eve show.

According to the statistics of AGB Nielsen, the audience rating is as high as 3200 million.

It also didn't make him feel much better.

The ratings of 3200 million viewers are indeed very high, comparable to the ratings of the 1993 NBA Finals.

This ratings is also the highest record in the NBA at this time.

The first Isa show was able to achieve this level.

It can already be said bluntly that Elizabeth's back garden has become famous all over the United States and even the world.

Such a huge advertising effect.

It also made Elizabeth Gardens, which opened on Christmas Day the next day, full of 100 stores across the United States every day.

In just three days, the total sales of 4500 ISA stores in the United States have exceeded [-] million US dollars!
The average daily sales of a single store is 15 US dollars.

The highest daily sales of a single store is 28 US dollars, and the lowest daily sales of a single store is 6 US dollars.

These figures are all tops in the industry.

The sales in three days is equivalent to the sales of more than 100 Victoria's Secret stores in more than four months at this time.

This achievement is already very gratifying, if it can be maintained.

It can be said that it is completely worthy of Abel's energy and money in this regard.

But Abel wasn't too happy about it.

Whoever called it, whether it was Isa Company or Isha Daxiu, it was just a whim of fun for him.

He was in a bad mood.

This overturned his original plan to be silent for a month or two.

He wanted to see rivers of blood flow.

The penultimate day of 2000.

That is, December 28th.

Smith Building, where Smith Capital is located.

Enter the safe house state of the whole building again.

Sending people to keep an eye on the Wall Street giants of Smith Capital.

Got the news right away.

Goldman Sachs, the Market Supervision Department also notified their CEO immediately.

At the time, Paulson was in a meeting with several company executives.

The meeting is to discuss some investment strategies and plans after next year.

Upon hearing the news, the CEO was lost in thought.

As far as Paulson knows, Smith Capital has been established for more than half a year.

In the market, Smith Capital invests a lot and moves a lot.

But before that, Smith Capital had only conducted a company-wide safe house status once.

Paulson knew, during that safe-house situation that lasted for days.

Smith Capital has made billions of dollars in profits in the international foreign exchange market.

That is almost more than the profit of Goldman Sachs for a whole year this year.

That Smith Capital firm-wide safe house status.

It's been over a month now.

This time, Smith Capital has entered this state again.

Then think of the news that Abel Smith just returned from Texas yesterday.

Paulson had to think—could this be Abel's new capital hunt?
Or... got support from Texas?

Otherwise, why did Smith Capital get busy as soon as he came back.

Paulson, who had contact with the people in Texas, had to think so.

Paulson asked the head of Market Surveillance a question.

"I asked you to track the stocks of Smith Capital in the stock market. How are they doing?"

The person in charge immediately replied:
"Most of the 131 stocks are rising. The fastest-growing stock has risen 76% since Smith Capital bought it."

Stocks are relatively public investment products.

Coupled with Wall Street giants, you can get first-hand market intelligence.

Unless when investing, carry out complex decentralized holdings and use hundreds or thousands of accounts to hold them.

Otherwise, a single corporate holding.It is difficult to hide from the detection of giants like Goldman Sachs.

Smith Capital's investment in the US stock market did not intend to hide from others.

Anyone who cares can find it out.

Be more careful and send more elite analysts to watch.

In this way, I want to know the daily rise and fall of these stocks of Smith Capital.

It's not too difficult.

"That's according to your calculations." Paulson said:
"How much has Smith Capital gained or lost on these stocks so far?"

The person in charge already had the exact figures, and he immediately replied:

"As of today's opening. The figure we estimated is that Smith Capital's account value in these 131 stocks is about 150 billion to 160 billion U.S. dollars."

Hearing this number, Paulson frowned on his bald face.

Paulson remembers Smith Capital's investment in US stocks.

Goldman Sachs analysts have analyzed it before.

Smith Capital Account Value.

Probably around 130 billion to 140 billion US dollars.

According to this valuation.

If it is calculated at a minimum of 135 billion US dollars, Smith Capital’s investment in US stocks has made more than 20 billion US dollars in profits so far.

Based on the calculation of US$145 billion, Smith Capital's profit in the US stock market is at least US$15 billion.

This...how many days?
You made so much money in less than half a month?

After learning this data, Paulson was speechless for a long time.

In the end, he ordered the Market Supervision Department, "Continue to monitor. See what financial products they invest in in this state. When you get the exact news! Remember to notify me immediately!"

"Remember, you need to be notified anytime, anywhere! 24 hours, no matter what time it is, understand?"

24-hour standby is too common in the financial field.

Even if Paulson is in a high position, it is inevitable.

Who is the global financial market, it is always changing, and there are markets trading 24 hours a day.

When Goldman Sachs received the news.

Naturally, other Wall Street giants did not let go.

Giants such as Merrill Lynch Securities and Morgan Stanley also received information from Smith Capital that they entered the safe house state again.

It is different from Goldman Sachs, which is somewhat cautious because of Paulson.

Merrill Lynch and Lehman Brothers, when they got the news.

Stanley O'Neill, and Richard Fuld, the bulldog of Wall Street.

These two Wall Street oligarchs are much more aggressive and excited.

Stanley O'Neill rushed to the company immediately.

The black president convened the relevant personnel of the company's investment department.

So did Richard Fuld.

And it's not just these two companies.

There are many titans on Wall Street who are eyeing Abel.

They all responded differently, but somewhat similarly.

After that investment reception.

Abel made the move to start his own merchant bank.

And his approach is undoubtedly a showdown to Wall Street to some extent.

As a result of the showdown, the entire Wall Street became wary of him.

cast coveted eyes on him.

Also last month, he deliberately made David Mellon make several mistakes in investment operations.

has been greatly enhanced.

As if after that day.

The aura of The Wolf of Wall Street is gone.

Everyone no longer fears him.

Everyone wants to see if they can tear off a piece of meat from Smith, like Goldman Sachs, Lehman or Merrill Lynch.

Even though many people know it.

The failed operations of Smith Capital were probably not done by Abel.

But in the eyes of these people, after those few times.

It was as if Abel Smith had a crack in his unbreakable golden body in the capital market.

Everyone started to test, everyone started to monitor.

Everyone wants to see if they can snipe the opponent in the next action of Smith Capital.

About three hours later, at noon on December 12.

Most of the giants on Wall Street have already found out.

The investment direction of Smith Capital, which has entered the safe house state.

It's foreign exchange!
Abel Smith plays the most, has the most profit, and is also the most risky financial product.

Everyone found that this time Smith Capital invested a large amount of money in the currency pair USD/JPY.

This time, Smith Capital, most of the funds are operated through the Pacific Commercial Bank.

Another part of the funds, through Wells Fargo and Citibank.

It is no longer as close as before to those investment banks.

This makes those Wall Street investment banks only know that Smith Capital has a large amount of funds this time, with a principal of at least one billion US dollars.

However, there is no way to capture the exact amount of funds and the exact flow of funds.

Smith Capital with its own capital turnover center.

Its investment situation and capital flow can no longer be completely monitored.

Wall Street giants can only make a rough judgment through the approximate flow of funds.

Smith Building.

In the trading hall on the third floor.

At noon, Abel was looking at the USD/JPY currency pair on the wall of screens.

It is indeed as shown by some of the intelligence detected by those Wall Street giants.

This time, Smith Capital is focusing on the currency pair USD/JPY.

To be precise, Smith Capital is opening a short USD/JPY position.

USD/JPY is now at 107.700.

Since 1998, the USD/JPY bull market has gone for almost three years.

The USD/JPY bull market in the second half of 2000 reached around 107.

At this juncture, the attitudes of international speculators and domestic investors are somewhat divided.

Half of the people insisted that this time the yen might reach the exchange rate of 1994 or even more than 1995 in 100 and 90.

These people are similar to the judgments made by those who are relatively optimistic about the economic situation of neon cabinets in their own country.

The other half believed that the yen was unlikely to strengthen any longer.

Because if it continues to strengthen, it will greatly suppress the economy of an export-oriented country like Neon.

In addition, in the market, many long-term bulls have begun to close their positions.

There is also less and less support for the dollar/yen to rise.

Once a large-scale long liquidation is caused, the dollar/yen will also plummet at the intersection of the new year and the old year.

But none of this is actually Abel's analysis.

The reason for him to make this judgment is simple.

His talent told him [the three-year USD/JPY bull market will usher in a huge correction]

For this reason, throughout the morning, Smith Capital has established 5 short positions.

The average opening position is 107.500.

This makes Smith Capital still floating losses.

For a short position of 10 lots of USD/JPY, the fluctuation of one point is 50 US dollars, and the current floating loss is 1000 million US dollars.

The 1000 million US dollars is just a drizzle for Abel, and Abel doesn't care at all.

But the traders of Smith Capital who were in charge of the operation, as well as David Mellon, were already a little worried.

Because before this, Abel led the capital investment.

From the beginning to the end, there were almost no floating losses.

It's just winning and winning.

This is still on Smith Capital's account.

When making Abel's request, there was a floating loss for the first time.

There is a moment of slight worry in everyone's heart.

Abel asked Smith Capital to open a position and continue to short.

However, he told Smith Capital not to build positions too fast.

This is because even with his current financial knowledge.

Also know in this case.

If you build too many positions too quickly, you will short 10,000+ lots of USD/JPY at one time.

It is estimated that the market will not be able to digest it, which will easily cause the USD/JPY to plummet.

Abel didn't want to do this, his talent allowed him to eat as much as possible in the highest area.

That keeps profits higher.

It was one o'clock in the afternoon.

Abel saw that the USD/JPY had once again rushed to the 107.500 position, so he immediately shorted 1 lots of USD/JPY!

This approach immediately pushed down the USD/JPY by 5 points before it was supported.

Immediately, USD/JPY began to fluctuate.

After 5 minutes, he rushed up again.

Abel immediately shorted another 1 lots and suppressed it again.

Just like this back and forth, many times, USD/JPY can no longer rush to the 107.500 position.

It is currently oscillating above the 107.400 position, but the support at the 107.400 position is still strong.

Seeing the trend of USD/JPY at this moment is in line with my own "talent" judgment.

This made Abel sneer-this time let you see, what is the big short on Wall Street!

From morning till now.

Smith Capital was at the 107.500 position in total, shorting 5 lots of USD/JPY short orders.

At present, Smith Capital holds a total of 10 short positions in USD/JPY.

The floating loss has reached more than 3000 million US dollars.

A standard position of 100 lots would cost $[-] billion without leverage.

Smith Capital's free funds currently only have about $30 billion left.

Without leverage, it is impossible to leverage such a large amount of funds.

So for this investment, Smith Capital also used leverage.

It's just because they can't trust those investment banks on Wall Street.

This time, there are only three banks left as guarantors for Smith Capital.

They are Pacific Bank of Commerce, Wells Fargo and Citibank.

Among them, [-]% of the funds came from the Pacific Commercial Corporation, and the other [-]% were in charge of Citigroup and Wells Fargo.

Although Citigroup and Wells Fargo are also part of Wall Street.

But anyway, the main business of the two banks, Citigroup and Wells Fargo, is still on the side of commercial banks.

This is far more credible than other investment banks.

Coupled with their strong capital, they can support the funding needs of Smith Capital.

The two banks each gave Smith Capital 8 times the leverage.

Abel has $10 billion in deposits at both banks.

In other words, he can leverage a total of $160 billion in funds at the two banks.

For the remaining Pacific Commercial Bank, the leverage is very exaggerated.

Abel's deposit at the Pacific Commercial Bank is also one billion US dollars.

But Pacific Bank of Commerce, gave him 25 times leverage
His one billion dollars in the Pacific Bank of Commerce, the funds that can be leveraged are 250 billion U.S. dollars.

Such a large amount of capital, such an exaggerated leverage multiple.

This is almost impossible with any other bank.

But who is called the Pacific Commercial Bank, it is his personal wholly-owned bank.

As long as his boss is willing to take risks, as long as the Pacific Bank of Commerce has enough funds.

Even if he used [-] million US dollars to leverage so much funds.

In terms of formalities and laws, it is also completely reasonable.

This is the benefit of having your own bank with sufficient funds.

Of course.

There is a cost to doing so.

One is that interest and commissions must be paid as they are, even if they are paid according to the minimum standards required by the Federal Reserve.

Otherwise, it is illegal and will be punished by the regulatory authorities.

another.
It is this kind of high leverage, or internal leverage.

If exposed, it may cause concern among Pacific Bank of Commerce customers.

Thus triggering a possible run on the Pacific Bank of Commerce.

That is to say, regardless of the cost.

Abel's current "ammunition" is 80+80+250, a total of 410 billion US dollars.

At present, 10 empty positions are opened, costing about US$100 billion.

He also has $310 billion in stock.

It was two o'clock in the afternoon.

When USD/JPY falls again.

Abel seized the opportunity and shorted 5 lots of USD/JPY again.

Suddenly USD/JPY fell two points again, and then was supported again at 107.400.

Abel immediately continued to increase the short position by 107.400 lots, and immediately the USD/JPY failed to stand firm at [-].

After more than ten minutes, USD/JPY slipped 10 pips to 107.300.

The data milestone given in "Talent" has arrived.

Abel was overjoyed immediately, and continued to short USD/JPY.

At this moment, the transaction department of Bank of Merrill Lynch, in a unique office.

Stanley O'Neill watched USD/JPY fall again.

He looked back at Charlie Schaff, and the CFO replied softly:
"It's basically confirmed. Smith Capital is shorting USD/JPY on a large scale."

"Does he think the yen bull market is over?" asked Stanley O'Neill.

Charlie Schaff shrugged: "Who knows? But he dared to short such a large sum, he should think so."

Stanley nodded and thought for a few minutes.

Suddenly the black president asked: "How profitable is our long account?"

The USD/JPY bull market has been going on for almost three years. At the beginning, the bulls and the bears fought hard, and they were in a relatively balanced state.

But since two years ago, the bear force has been insufficient, and the bear massacre has occurred.

Since then, many bulls have started long-term long-term.

Companies such as Merrill Lynch and Goldman Sachs have entered this relatively stable long-term business.

"About fifty thousand more," replied Charlie Schaff.

Hearing this data, Stanley decisively ordered Merrill Lynch's trading department.

At the position of 107.300, a 1 lot USD/JPY long order was placed decisively.

The black president of Merrill Lynch continues to be bullish on USD/JPY.

Why did Stanley O'Neill gradually replace the original CEO of the company in the past two years?
Except that he is very good at being a man and can please the board of directors.

It is also because Stanley O'Neill has been on the currency pair USD/JPY since three years ago.

It made a lot of profits for Merrill Lynch.

In the past two years, Stanley O'Neill has been long USD/JPY on dips, and the combined profit has reached as high as 20 billion US dollars, which is really refreshing.

This staggering profit, coupled with his formidable office intrigue skills.

Only then did Stanley O'Neill gradually emptied the original CEO.

Otherwise, just rely on office skills.

You may be able to get along in the four major investment banks, but it is absolutely impossible to occupy a high position.

Investment banking Investment banking, investment banking.

In the end, if you want to be in the top position, you still rely on your skills in the investment field.

Today Stanley O'Neill is still bullish on USD/JPY.

Although the recent USD/JPY rally has begun to slowly diminish.

But he believes that the dollar/yen still has a long way to go.

So Stanley O'Neill is in no rush.

Stanley O'Neill's [-] USD/JPY long position, plus other long positions.

About [-] lots, and immediately swept away the short orders in the market.

This behavior caused USD/JPY to rush up again, from 107.300 to 107.390.

On the other side of Wall Street.

Lehman Brothers Bank Trading Department.

Richard Fuld had just made up his mind and wanted to get the men in the trading department.

I bought [-] lots of USD/JPY, but I didn't expect to be taken one step ahead.

As said before.

USD/JPY has been bullish for two years.

There are a large number of investors and institutions all over the world, and they all have a large number of USD/JPY long orders.

So did Merrill Lynch, and so did Lehman Brothers.

In the past two years, the neon economy has picked up and the yen has strengthened.

Let the yen in the neon cabinet surpass the pound last year to become the second world-class currency in the world.

Needless to say, the first is of course the US dollar.

The market is bullish, coupled with a large number of long positions.

In the past two years, no matter which short seller enters the market.

They are often forced to leave the market one by one by the strong economy of neon and the combination of bulls.

Investment banks like Lehman and Merrill Lynch.

In the past two years, I have made very good income in terms of long USD/JPY.

Lehman Brothers now holds more long USD/JPY orders than Merrill Lynch.

Merrill Lynch only has [-] to [-] hands.

The Wall Street bulldog, who has always been very courageous, now holds more than [-] lots of USD/JPY.

But just confirmed that Smith Capital is under this general trend.

After actually defying the general trend and starting to short USD/JPY in large quantities.

Richard Fuld was immediately overjoyed, thinking that this was a good opportunity to slash the flesh and blood of Smith Capital.

As soon as an empty order appeared in the market, he wanted to buy.

It's just that someone moved faster and cleared the list before Lehman Brothers did it.

"Madfake, has anyone seen it?"

Richard Fuld thought, frowning.

Although the USD/JPY has been rising recently, the range is getting smaller.

But still in a strong state as always.

In the previous two years, there have been many short massacres.

Richard Fuld believes that this situation should be at least half a year away.

He believes that in the past six months, it will continue to rise.

Plus, Richard Fuld felt he could afford to do the same.

Lehman Brothers held more than 200 long positions, with a total profit of 12 points, which was worth $[-] billion.

Such a high floating profit made Richard Fuld full of confidence.

Coupled with the recent trend of USD/JPY for more than a week.

It completely conformed to Richard Fuld's previous judgment in his heart, and Richard Fuld couldn't help but feel a little happy.

Richard Fuld made the same judgment as Stanley O'Neill.

He intends to continue to promote the upward trend of USD/JPY and start to build positions!
He thought that doing this was a good opportunity to take advantage of the general trend and cut off a large piece of flesh from Abe Smith, who couldn't see the general trend clearly!
Now that everyone has said it.

There is no way to be a running dog, only to be an opponent or a friend.

Then those old-timers on Wall Street will not be polite!

Thinking of this, Richard Fuld, who was even more courageous, immediately bought [-] more hands.

USD/JPY is back in the 107.500 band again.

(End of this chapter)