American Peanuts

Chapter 38 The Butcher of Wall Street
After a full minute, Hadley let go of Charlie.

"Sorry, I'm a little too excited. Is there evidence in this USB flash drive? I can take this and ask the news director for more overseas opportunities, and I can switch from the afternoon slot to the evening prime slot." Harder Li began to make calculations.

"There are some semi-public data here, which is enough to prove that Madoff's 30-year investment career is magical. Unless he is really reborn from the future and can predict the future, he will definitely not be able to escape the SEC's investigation." Weiss, who wears glasses, Te explained.

Here, Charlie has already wiped away the lipstick marks on his face, forehead and neck, and then said: "West's analysis is absolutely reliable. He works for a short-selling agency whose name you must have heard, called Citron Research." .”

Citron Research Company, an influential short-selling institution, has long claimed that it has only one employee. In fact, this is for the safety of its staff. Citron has long had an entire investigation team.West is one of them.

The word "citron" also refers to lemon, which in English refers to something bad.Their goal is to find those "bad lemons" in the stock market, find evidence of financial fraud, and then write an analysis report and publish it to the public.Profit comes from establishing a short position in advance and selling it at a high price, and then repurchasing it at a low price to close the position when investors are in panic, which is the same as the previous short position PB.

Since its establishment in 01, Citron has achieved great success. It has attacked more than 30 listed companies and forced eight of them to be delisted.

This kind of behavior is quite a bit like a gangster taking advantage of others. Of course, except for some moral criticism, this does not violate any laws in the United States.

Therefore, these short-selling institutions have a more vivid nickname: "The Butchers of Wall Street."

As for another notorious short-selling institution, Muddy Waters, it has not yet been established.

"I've only heard of the name before, but this is the first time I've met Citron's researcher." Hadley quickly stood up and shook hands with him.

"Don't let my name appear in the news tomorrow. It can be said that it's 'according to people familiar with the matter'. I don't want to be exposed." West reminded.

"Understood." Hadley sat down slowly.

She looked at the other two people inadvertently. Although Charlie did not introduce their work organizations, she knew it was unusual just thinking about it.

Charlie got himself here...

If maintaining this kind of relationship with him before was more out of desire, coveting his body, and admiring his abilities, then Hadley's current relationship was even more determined.

Under the table, she quietly grabbed Charlie's right hand and interlocked her fingers with him.

The warmth from the palm made Hadley feel at ease.

The conversation between the four people that followed made Hadley feel chilled.

She was surprised to find that compared with what the four people were going to do next, Madoff's "largest Ponzi scheme in history" was nothing.

"You want to short the U.S. real estate market? Don't be kidding. Real estate prices have been rising for 30 years, with an annual increase of 5.00% to [-]%, without interruption for so many years." Hadley warned.

"Yes, but the rise has come to an end, Hadley. Throughout last year, except for a few economically prosperous areas such as New York, prices in most areas have stagnated. Look around you, now use a dog You can apply for a real estate loan in your name!”

"Homebuyers want to take a ride, bankers want to make money, and financial institutions and rating agencies also want a piece of the pie. There may be many smart people in this country, but the smarter the people, the more greedy they are. They Just like those poisonous insects, they always tell themselves that this is the last time, until they put themselves in the abyss of eternal destruction."

"The financial crisis is coming, Hadley. This time it is not the Internet bubble or the Asian financial crisis, but a horrific disaster comparable to the Great Depression. Maybe by the second half of this year, the number of suicides will rise sharply." Charlie said lightly. said.

His tone was like that of a grim reaper.

"We are going to establish a hedge fund, focusing on CDO and CDS, and the date is April 4." Charlie put his hands on the edge of the table and looked at the three classmates present.

The full name of CDO is "collateralized debt obligation". To put it simply, suppose a construction company owns a highway and wants to raise funds one day. It can directly mortgage the toll rights of the highway to the bank, or it can entrust a Wall Street financial institution to transfer it. Package them into bonds and sell them in the secondary market.

The buyer in disguise owns the toll rights of part of this highway. If more and more cars pass by, the income from tolls will increase, and the bond will appreciate.

On the other hand, if a national highway is built next to it and there are no more cars on the highway, the bond will become a piece of waste paper.

To deal with this situation, "smart" Wall Street created a kind of insurance that promised to pay out when returns fell to a certain threshold.

The first one is called CDO, and the second one is called CDS.

Wall Street has a dazzling array of financial products, which will indeed increase the efficiency of capital utilization, but at the same time, risks will spread. When the economy goes down, it will turn into a complete avalanche.

Ultimately, Wall Street never creates wealth, it plunders it.

"Wall Street has completely bonded the real estate and insurance industries. These three industries together account for 1991% of the U.S. GDP. In fact, they are all fabricated castles in the air. This is why the U.S. GDP always looks worse than before [-]. Another reason why the opponent should be higher.”

"Charlie Rossi, as a friend, we need to remind you that if you fail, you will lose your company and all your wealth." West said.

The three of them were not well-known on Wall Street, and with less than a month and a half left, they could not attract other investors at all. This time, Charlie planned to use his own property to enter the market, which was a bit like a death squad.

"Risks and opportunities coexist, don't they? And it's a once-in-a-century opportunity!" Charlie seemed confident.

The operations of "Wall Street Sky God" John Paulson are still fresh in my mind.

The previous prophetic tweet was a seed planted.

At that time, he will become the real "Wall Street Butcher".

(End of this chapter)