Wall Street Financial Truth

Chapter 7 The Truth About Wall Street (5)
On May 2011, 5, German media reported that the Greek government had proposed the possibility of withdrawing from the Eurozone and re-introducing its own currency.Subsequently, Greece fell further into internal and external difficulties, and the domino effect of the euro area was about to begin, that is, as long as any member of the euro area refused to use the euro, the chain reaction would inevitably lead to the disintegration of the euro area.Many member states of the euro area want to rely on the European Central Bank to resolve government deficits and debt crises, but the Achilles heel of the euro area lies in the partnership between rich countries (such as Germany and France) and relatively "poor" countries (several countries that have already experienced crisis) live.Just imagine, can the rich and the poor live together?
Who would be happiest if the eurozone disintegrated? ——It is the United States that holds the weapon of "dollars"!The dollar is much more powerful than nuclear weapons!If we say that when the euro comes to an end, it will be the day when the dollar gets rid of its serious worries.

In order to achieve the goal of monopolizing global wealth, Wall Street used the financial crisis to severely attack the currency that competes with the US dollar - the euro.Wall Street, which has been reshuffled, has monopolized the world's resources at the top of the wealth pyramid, which has enabled the highly liberalized and market-oriented American economic model labeled "neoliberalism" - Wall Street's model of consumption in advance and credit consumption. Global promotion.And this model violates the basic laws of the market economy, distorts the relationship between supply and demand, and enables Wall Street to plunder wealth by inflating economic bubbles.This tactic of plundering wealth has been tried and tested by the United States in emerging markets.

take China as an example.The essence of Lao Tzu's Taoist thought "If you want to take what you want, you must first give it" is vividly interpreted by Wall Street.In the early stage of reform and opening up, China was eager to change the poor and backward situation, and opened its doors to this end, actively introducing foreign capital and advanced management methods from foreign companies, in order to enable the people to live a better life.Wall Street aimed at this opportunity (the former CEO of Goldman Sachs Paulson, later the Secretary of the US Treasury), taking advantage of China's urgent need to "get rid of poverty", and extended its plundering hands to China on the other side of the Pacific Ocean.They took out their usual tricks, first slammed the air-funded banks and the Chinese stock market, and took the opportunity to plunder.

In December 2002, Goldman Sachs issued a research report claiming that the non-performing loan ratio of China's banking system was 12%, making it the worst bank in Asia.By the first half of 40, the British "Financial Times", Goldman Sachs, Moody's and CLSA had issued warnings to the Chinese banking system, repeatedly emphasizing that Chinese banks' non-performing loans had great risks, and if they were not handled properly, they would destroy China's economic reform results.Those western media and financial institutions have made unanimous remarks, creating momentum both at home and abroad, and trying their best to belittle China's banking industry.

In the blink of an eye, at the end of 2003, international credit rating agencies such as Standard & Poor's rated China's sovereign credit rating as BBB, the lowest level among "investable grades"; they also rated the credit ratings of [-] Chinese-funded banks as " "junk level" so that the international financial consortium can get the negotiated price when negotiating the equity acquisition transaction.

On January 2004, 1, when the State Council announced the news that China Construction Bank and Bank of China would implement joint-stock reform pilot projects and inject $6 billion in capital, it immediately aroused great concern from public opinion at home and abroad and from the industry. The opportunity finally came. Since 450, major international card consortiums have marched into China under the banner of helping the reform of Chinese-funded banks. The war for China's cake has been full of smoke and flames.Let's take a look at how these "gold bullies" under the banner of friendship devour Chinese assets.

Under the help of Morgan Stanley, Bank of America injected US$2005 billion into China Construction Bank in 30, accounting for 9% of CCB's shares, and the price per share was only HK$0.94. In 2008, it added another 60 billion shares from Huijin, adding more to 19%. On January 2009, 1, Bank of America sold 7% of CCB shares at HK$3.92 per share in Hong Kong, making a book profit of US$2.5 billion. CCB shares immediately fell by 13.3% that day, and the Hong Kong Hang Seng Index fell by 5.84%.On May 0.53 of the same year, Bank of America sold 5 billion CCB shares at HK$12 per share, earning US$4.96 billion.In less than four years, Bank of America has profited close to US$35 billion from China Construction Bank, and the return on investment is as high as 73%, not including the hundreds of millions of US dollars in annual dividends!

In 2005, Goldman Sachs personally brought in Allianz and American Express. They jointly invested US$37.8 billion in the Industrial and Commercial Bank of China, acquired about 10% of the shares, and set the stock price at 1.16 yuan per share. As of the end of February 2009, They sold and cashed out US$2 billion, making a book profit of US$99.2 billion, and the rate of return was as high as 61.4%.

Since then, UBS, Royal Bank of Scotland, Singapore Temasek Holdings and Asian Development Bank have invested a total of US$87.8 billion in Bank of China. The stock was priced at only 1.22 yuan per share when they bought shares, but the total profit after cashing out was as high as 41.35 billion Dollar.Bank of China confirmed that the Royal Bank of Scotland sold all of its 2009 billion H shares at the beginning of 108.1. Less than half a month before the expiration of the lock-up period, Bank of China encountered three major foreign shareholders who reduced their holdings .

HSBC took the lead as early as 2004, injecting 17.5 billion US dollars into Bank of Communications, occupying 18.6% of the bank's shares, holding a total of 93.1 billion shares, and cashed out 2009 billion US dollars before the end of February 2, with a book profit of 56.6 billion USD, the rate of return is as high as 39.1%.

Those international financial conglomerates are Goldman Sachs' so-called "foreign strategic partners". Their strategic partnership with Chinese listed banks is to allow them to acquire the equity of Chinese banks at the lowest price at the right time. After the game made a fortune, it took a pirate ship full of loot, set sail and retreated.The Chinese banking industry has become their cash machine, and all the fat and water have flowed into the fields of outsiders!It can be seen from this that what a powerful weapon Wall Street's listing game and its monopoly on pricing power are!
The "prescription" Goldman Sachs gave to Chinese banks is a sugar-coated bullet under the banner of helping China's banking reform.The reason is that the Chinese people are too kind, and because they are kind, they see all kind people in their eyes; and those Wall Street institutions, because they are wolves, so in their eyes, others are also wolves .When they bite others, the crueler the scene, the more enjoyable they are, and the stronger the bloody smell, the sweeter they feel.Expect them to be merciful?Totally impossible!
In the end, when we cleaned up this mournful battlefield, looking at the devastated scene, our hearts were bleeding!Those international financial conglomerates made a total profit of close to US$236 billion after selling off their stakes in China's state-owned commercial banks.The total profit of these four banks in 2008 was 2953.7 billion yuan, with an average annual growth rate of 30.5%.Among them, China Construction Bank achieved a net profit of 926.42 billion yuan, a year-on-year increase of 33.99%; Bank of China achieved a net profit of 635.39 billion yuan, a year-on-year increase of 13%; ICBC's net profit reached 284.23 billion yuan, a year-on-year increase of 38.56%.

Although the profits of these state-owned commercial banks have increased enormously, unfortunately, who is really sharing the high profits?Not the vast number of Chinese investors and the four major commercial banks themselves, but Wall Street jackals who eat meat but don't spit out their bones.Take China Construction Bank as an example. Bank of America still owns 10.75% of China Construction Bank after selling its shares.In other words, Bank of America will also seize more than 10% of China Construction Bank's net profit, which is close to 100 billion yuan.According to the most conservative estimate, in just one year, foreign-funded institutions deprived Chinese-funded banks of more than 1 trillion yuan in profits, or about 1471 billion U.S. dollars (calculated at a 1:6.8 exchange rate), plus 236% of other proceeds from selling equity. billion U.S. dollars, and foreign-funded institutions looted a total of 1707 billion U.S. dollars.

What kind of huge sum is this?Under the current situation, this huge sum of money is enough to acquire the controlling stakes of 3 large commercial banks like Citigroup, and can be used to rescue the three major US auto giants more than 9 times.Since the founding of New China, it has always been the dream of the Chinese navy to have a nuclear-powered aircraft carrier, and the 1707 billion US dollars is enough to purchase 15 nuclear-powered aircraft carriers, including all the carrier-based aircraft on them, so that the Chinese navy has an unrivaled possession in one fell swoop. comparative advantage.

In the past, the people of various countries resisted foreign aggression and resisted the shameless plunder of imperialism by relying on the extreme model - taking up arms and launching wars.Now, the plundering has not stopped, and the resistance continues, but the weapons of the enemy and ourselves have changed, and it is a war without gunpowder.On the contemporary battlefield, the enemy and the enemy engage in fierce fighting with financial means that do not see real swords and guns. However, the scenes of bloodstained battlefields and flames of war are no different from real wars.No matter who the loser is, the feeling of picking up the pieces can be heart-wrenching.

"Small thieves hook, big thieves the country." Being robbed of huge national wealth by foreign "robbers", for any bloody Chinese, this kind of bad breath must be vented.We also need to take up the weapon of "finance" to fight back.Just as the financial tsunami was brewing at that time, Chinese-funded enterprises were high-spirited and high-spirited, and made a large-scale acquisition of overseas equity assets, preparing for a beautiful turnaround.As a result, they were not familiar with international rules, and the acquisition was not ideal, and it can even be said that they suffered heavy losses.

In the final analysis, the key to the development of the financial industry is talent. Recruiting and cultivating financial practitioners who can stand the test of the international financial market and have patriotism as soon as possible is a top priority for Chinese banks and financial institutions that are preparing to go global.Otherwise, China, as the buyer, will be unable to distinguish the risks of financial products, and can only consult the international investment banks as the seller on issues such as market trends and professional knowledge.The international investment bank is like a mouse falling into a rice bowl, how can it not eat it hard?
10. "Fudge" the public's financial data
In Canada, which is closely related to the United States, as corporate profits are declining, the unemployment rate is also rising, and the proportion of people filing for bankruptcy is even higher than that of the United States. Naturally, housing prices, like the United States, began to fall a year ago. What is surprising is that there is a statistic that shows that the Canadian housing market has "rebounded against the market".

On June 2009, 6, the Canadian Real Estate Association (CREA) released a statistic, pointing out that in the past four months, the national average house price recovered by 15% from the lowest point in January, breaking a record to around 16.4, which is higher than The average price of 32 in the United States is nearly 19% higher!This statistic is puzzling.Could it be that Canada, as America's brother-in-law, will house prices stand alone in the global crisis?
Statistics are very effective in counting the human population. For example, no matter where people are, adults will not be taller than 3 meters, and people under 1 meter are rare; while people weighing more than 1000 pounds and less than 50 pounds People are almost unique, and the probability of existence is almost the same as winning the Mark Six lottery.But applying statistics to economics, sometimes like comparing apples to oranges, can be misleading.

A few years ago, I worked as a "middle-level cadre" in one of the top ten investment banks on Wall Street.At the end of the year, the media reported that our company's "average bonus" was US$50, and "bad news spread far and wide." My relatives and friends all congratulated me, "A red envelope is half a millionaire!" In fact, although that year My year-end performance evaluation also got an "A+" (belonging to the "model worker" level), and the red envelope I can get is only 20% of the company's "average bonus", which is hard to say.Ask the colleagues around, the size of the red envelope is probably smaller than mine.It was only later that I found out that the red envelope of a super sales manager in our company was 1 million yuan, and the red envelopes of those CEOs, CFOs, CTOs, and several fund managers were more than [-] million yuan.In this way, our money "average" went to their pockets.And I was "averaged" to become half a millionaire!
事实上华尔街90%的奖金被1%的人拿去了，而这种将我们5万～10万的红包和他们千万上亿的红包放在一起的统计方式，就像将一头大象和一万只小蚂蚁加在一起算平均体重那样。CREA的统计方式就是如此，它是用MLS（多重上市服务机构）上所有重售房屋来计算的。比如，只要有一栋1000万的房子售出，就会将其他1000栋售价在30万的“平均房价”抬高到31万（上升了3.33%）：（1000栋×30万）+（1栋×1000万）=31000万，而31000万／1001栋=31万。’就这样，由于这段日子的加国的富人对豪宅的需求上升，便推高了再售屋的“平均房价”。

Other indicators reveal holes in the CREA statistics.According to OECD statistics from the Organization for Economic Cooperation and Development, housing prices in Canada fell by 2009% in the first half of 11; and according to the new housing price index released by Statistics Canada, housing prices in June 2009 fell by 6% compared with September 2008. %, of course, these statistics cannot reflect the whole picture of the overall housing market, but at least they are much more reliable.

In addition, when looking at a statistical data, pay attention to which department it is released from.Just like a coffee company invites people to study the impact of drinking coffee on the body, the results definitely do more good than harm. It’s like asking a barber if he wants a haircut, and the answer will always be YES, even if you are bald.

The Standard & Poor's housing price index in the United States is relatively reliable. It uses similar houses in the same area, such as similar living space, style, and number of bedrooms, as the statistical basis.

It is easy for different institutions to take advantage of the uninformed public to use financial data for their own use.Where are financial data published?What is the reference?How to interpret is very knowledgeable, readers need to be more careful.

11. The Ghost Horse Game of Wall Street
In 2010, a shocking scandal was exposed in the financial world. Because Buffett's former right-hand man Dave Sokol was suspected of insider trading, Buffett was also involved in the scandal of insider trading.Both Buffett and Sokol will be subpoenaed and investigated by the SEC.

The 55-year-old Sokol, as Buffett's right-hand man, has been regarded by the outside world as Buffett's quasi-successor.He claimed that he planned to buy 104 shares of Lubrizol (Lubrizol) at $5 per share for the first time, but when he bought 2300 shares, he felt that it was not worth the time to manage a few thousand shares, so he decided to sell.As for buying its stock for the second time, it is because he likes Lubrizol very much and thinks it is worth holding for a long time.

But Buffett’s Berkshire bought Lubrizol for $3 billion on March 14. The stock’s closing price at the end of March was $90. Roughly estimated, Sokol made a profit of $3 per share. The profit was nearly $133.96 million.Sokol voluntarily reported the transactions (though he doesn't think he was doing anything illegal), and Buffett backed Sokol, saying he knew about it all along, and Sokol's actions seemed innocuous (subtext: no big deal).

(End of this chapter)