Full-time student master

Chapter 102 Subprime Loans

Lehman Brothers, an investment bank that rose in the United States after entering the new century, has won the favor of many wealthy Americans with its rapidly expanding business and innovative financial management methods.

But Qin Tian knew that the subprime mortgage crisis was caused by their blind investment, which caused an irreversible situation. A large number of people lost their houses because of the subprime mortgage.

It is said that the person who proposed the real estate subprime loan at the beginning also won the Nobel Prize in Economics in a certain year, as well as multiple economics awards in that year.

As for real estate subprime loans, it is actually very easy to explain. For those who need this loan, that is, the originator of these loan debts, Lehman Brothers provided that as long as the house in their name is still repaying the mortgage, they can repay the house. The part of the loan can be second mortgaged, so these people can second mortgage the house to Lehman Brothers, so that they can get a loan equal to half the total value of the house, so that the person who handles the loan can buy another house The current house is a smaller house.

At the same time, in order to obtain sufficient funds in the market to support Lehman Brothers to continue this kind of subprime mortgage, they securitized this bond, thus forming subprime mortgage bonds, which can be subscribed by many ordinary Americans.

Of course, there are huge interest returns. Of course, subprime loans were also very popular at the beginning. The subprime loan index was once pushed to an unimaginable high point.

It is precisely because of this that Lehman Brothers received sufficient capital supplements, which allowed their business to continue.

And then they also introduced two sets of houses to mortgage the repayment value to carry out the loan of the third set of houses, and then gradually withdrawn the loan service of the fourth and fifth sets of houses based on this basis.

Similarly, in the bond market, subprime loans have also extended into a variety of models, and the crazy skyrocketing of subprime loans in the early stage also led to the crazy pursuit of subprime loan products launched later.

However, because the U.S. dollar has entered an interest rate hike cycle, lenders have to pay higher interest. At the same time, because subprime debt is sought after, and in order to expand their business, Lehman Brothers has also begun to authorize this business to other related banks, and then When the cycle that led to the U.S. dollar interest rate hike came, it also triggered a wave of capital redemption.

In the end, Lehman Brothers had to raise interest rates, which led to the inability of lenders to repay their debts, and then widespread defaults.

In the United States, personal credit is very important. If personal credit is stained, this person will also face the risk of being fired by the work unit.

It was because Lehman Brothers had become an important investment bank in the United States at that time, and their tainted records attracted the attention of employers, and a large number of Americans who could not repay their debts due to interest rate hikes lost their jobs.

It is precisely because of this unemployment that these people have lost their ability to pay back, and the final result is that Lehman Brothers can only take back their houses.

As a result, a round of cases of large-scale repossession of houses was implemented, and Lehman Brothers could not realize the real estate properties in a short period of time, and then could not honor the principal and interest of investors. As time went by, the subprime mortgage business also began to show negative growth.

The large influx of funds created a backlog, resulting in a large amount of interest payable, and Lehman Brothers was in a dilemma. At the end of 2007, Lehman Brothers filed for bankruptcy. At the beginning of 2008, Lehman Brothers Mann's request was granted, and the U.S. housing market began to plummet.

Qin Tian knew all this because of the subprime mortgages of Lehman Brothers, the United States entered the most serious economic crisis after the Great Depression era, and this era was later called the subprime mortgage era.

Fortunately, at that time there were still rich people in China, so some rich people in China took a fancy to the characteristics of the downturn in American real estate and low prices, and went to the United States to buy real estate.

As a result, after the U.S. economy recovered after 2012, these people have been rewarded handsomely.

These investments by rich Chinese businessmen have also brought the U.S. economy into a new era. This era in the United States followed closely after the era of subprime loans, and it is called the era of the rise of emerging manufacturing industries in the United States.

Of course, these are all things from the previous life, and Qin Tian only knew about them. After all, Han Yun graduated from a finance major at that time, and her sensitivity to the financial industry also infected Qin Tian at that time.

So when he saw Wu Kaili's mocking smile, Qin Tian just smiled and didn't explain much.

But Wu Kaili told Qin Tian about the magic of subprime loans, intending to persuade Qin Tian to believe in the potential of subprime loans.

However, this made Qin Tian, ​​who already knew the end of the subprime loan, have a feeling of being brainwashed by the pyramid schemes, and instinctively resisted this feeling, so Wu Kaili discovered for the first time that she had actually met someone she could not convince.

In her career, such people are rare. Even poor people who are still receiving relief, she can ask the other party to take out a piece of money from the bottom of the box before the other party has finished eating the relief. One hundred dollars to buy the bonds in your own hands.

Of course, the poor man who bought Wu Kaili's bonds finally became a small rich man with a house and a car with Wu Kaili's help.

But Wu Kaili may have overlooked one issue, she is now in China, not in the United States.

Therefore, Qin Tian's stubbornness made her think that Qin Tian didn't have much money in his hands. After all, Qin Tian was a freshman.

And Wu Kaili was wrong again, Qin Tian not only has some money, but also the revenge in Qin Tian's heart is beyond her imagination.

So but Kelly Wu said. "Forget it, how much money do you have as a student, I actually told you this!"

Qin Tian was taken aback when he heard the words, and then got a little angry, so he retorted unceremoniously, "Dear Madam Tutor, I hope you make it clear that this is Zhonghai University of Finance and Economics, and this is the place where the rich second generations of Huaxia are most concentrated. Children, but the capital owned by the family behind them may be a large amount that you can't imagine. At the same time, this is not the United States, so there will be no people in the United States who have graduated from college and can't calculate multiplication and division!

Huaxia's investment focuses on safety rather than return.And the subprime loan you mentioned to me is just a clumsy trick full of loopholes in my eyes. It’s okay if they don’t go wrong, but if something goes wrong, it will drag the entire United States into the abyss of economic crisis.

As the saying goes, when the basin is full, it will overflow, and the same is true for the economic market. The profitability and the speed of investment need to be kept within a reasonable range.

Once the speed of injecting funds is too fast, the profits will inevitably be squeezed. If they insist on forcefully, the profits will only be squeezed out, and finally they have to do something on the investors' principal.

So I won't get involved in a market like this unless I'm crazy! "

Wu Kaili did not expect that a freshman in the finance department would give herself such a powerful counterattack so quickly after she tried her best.

At this moment, Wu Kaili looked at Qin Tian and said with great interest, "I am a graduate of New York University, a graduate student and Ph.D. student at Columbia University, and spent four years on Wall Street after my Ph.D. I have passed through various projects in my hands. There are already dozens of them, and almost all of them have achieved success. You, a little freshman, dare to question my judgment and refute me! Did I hear you right!"

Qin Tian was still very modest, nodded slightly to Wu Kaili, and said, "I don't intend to offend you, but I still say that there is no priority in learning, and a master is a teacher. If you don't have a thorough understanding of the subprime loan issue, I will I can use my understanding to explain it to you. Maybe you only see some positive side, but I can conclude that the income of subprime mortgages will drop sharply at the earliest beginning of next year and the end of next year at the latest.

In the end, the profits generated by subprime loans will be eaten up by the interest of investors. In the end, Lehman Brothers will not be able to pay the cost of investors, and will be forced to declare bankruptcy! "

Wu Kaili began to re-examine Qin Tian. This young man was so interesting. Logically speaking, he should have heard of subprime loans for the first time, but his rejection of subprime loans was quite surprising.

This also made Wu Kaili understand a problem. Rich people in China may all need good investment opportunities, but with the emergence of a new investment model, Chinese people first think about risks, and they will not think about benefits like Americans. .

Qin Tian also saw what Wu Kaili was thinking at the moment, so he continued, "There are not many liars in China, and among the liars in the world, the Italian liars are the most powerful, and they invented pyramid schemes. But Chinese people However, this model has been brought to the extreme. In the financial field, I have always believed in the saying that all financial people are lunatics, rogues and fools. Their purpose is to let you spend money and let them invest.

For the control of returns and risks, what they bet on is probability. After all, no one can be a constant victor in the financial market. "

What Qin Tian said is very certain, and his statement that people who work in finance are all lunatics, rascals and fools, in fact, in a sense, this statement is correct.

After all, if you don't have the conviction like a lunatic, the face like a rogue, and the persistence like a fool, it is very difficult to survive in the financial industry.

And Wu Kaili's silence also indirectly acquiesced that Qin Tian's statement was correct, at least some parts were correct.

But Wu Kaili still said, "If Huaxia has an open financial system like the United States, it will develop better than it is now! You won't refute me on this point!"

Qin Tian smiled when he heard the words, took a sip of coffee from Wu Kaili, and said, "China has China's national conditions, and it doesn't work just by blindly applying the American system. And you think China's reform and opening up in the past 30 years , Has the achievements been very small? You have to know that China is a big country with a population of 13 billion. Not only is it vast in land and resources, but the gap between the rich and the poor is also very large. Moreover, the foundation for economic development is inherently weak.

To be able to develop to this level in 30 years is a miracle in the eyes of any European and American country, and you have to know that while the wealth is rising, the quality of the Chinese population is also rising, which Americans have not done until now Arrived! "

However, Wu Kaili's reaction this time surprised Qin Tian, ​​because she said, "Very good! I like you, kid, so I will apply to the school in the near future to let you be my project assistant. But there is a salary. And you only need to come at night, so it’s no problem!”

night!

Qin Tian became a little fanciful, but seeing the graphs displayed on the TV and computer screens, Qin Tian seemed to understand something.

(End of this chapter)