The Son of Finance of the Great Age

  Chapter 142 NYMEX Warnings

  After signing the investment intention agreement with Jiangdong City, Zhong Shi handed over the specific affairs to Huade Real Estate, and the rest was handled by professionals. It's just that he hadn't had a long rest when people from HSBC's brokerage department came to him.

  The person who came this time was a middle-aged man in his thirties, wearing a pair of gold-rimmed glasses, he looked very gentle. He was wearing a gray-green long-length windbreaker, carrying a typical briefcase in his hand. He looked shrewd and capable, but his eye bags were swollen and his pupils were bloodshot. It was obvious that he hadn't had a good rest before coming here.

   "Mr. Zhong, would you like to take a look at this first?" After introducing himself a little, he opened his briefcase and handed over an inquiry letter in English.

  His name is Gu Zhangli, and he is the deputy general manager of the Hong Kong brokerage department of HSBC. After receiving the fax from the North American department, he immediately contacted Zhong Shi non-stop, and then there was this visit.

  After establishing a short position of more than 100,000 hands, NYMEX paid close attention to the position of HSBC, and found that the short position in HSBC's seat did not stop building positions, and even intensified the situation. Now they couldn't sit still, and sent HSBC North America an extremely severe warning letter when Zhongshi established a short position of 130,000 hands, asking them to explain why there were so many short positions in their seats, and even threatened: It is possible to sue the seat.

  In the final analysis, brokers are just an intermediary role. They attract customers to enter the futures market through their own commission policies and professional research reports. Brokerage companies with greater power can provide customers with higher capital leverage, and may even replace the exchange for settlement, but it is not realistic for them to bear the corresponding risks.

Large investment banks have their own brokerage channels and self-operated businesses. Their operations have their own research reports as investment references. Besides, most of these companies have their own legal teams, which are very professional in avoiding risks and dealing with legal affairs. The SEC ends up investing a lot of human and financial resources to investigate their manipulation of the market, and it is often difficult to do so.

However, Zhong Shi cannot borrow all these resources. On the contrary, if he is to be accused, maybe HSBC’s brokerage department will clean up the relationship as soon as possible. You must know that the SEC uses the presumption of guilt, that is, if you cannot prove yourself motive, then you are manipulating the market, and you will face criminal charges next.

   "It's really troublesome!" Zhong Shi frowned and looked at it for a long time, and he roughly understood what was said in the letter, and then asked Gu Zhangli: "I don't know what HSBC meant before you came?"

Gu Zhangli showed a bit of embarrassment on his face. He understood the meaning of Zhong Shi's words very well, but one side is the SEC, and the other side is a client who can bring huge commissions to the company. When necessary, he can only choose one. This is definitely not the case. Zhongshi side.

"Zhong Sheng, according to the research of our legal department, if you cannot give a reasonable explanation, I am afraid that these positions will be forced to be cut off, and you will inevitably be charged with market manipulation. After all, these are not hedging orders. Our suggestion is to control the position at around 100,000 lots, and then give the trading committee a plausible explanation.”

If it is a long position, it is easy to explain. A "rigid demand" can stop most people's mouths. Of course, in this case, most of the orders must be delivered in the end. Billion dollar deal.

   "So, HSBC is going to abandon me?" Zhong Shi snorted softly, and looked at Gu Zhangli with a half-smile.

The embarrassment on Gu Zhangli's face became more obvious. After he bowed his head and remained silent for half a minute, he raised his head again and said firmly, "Mr. Zhong, you also know that this warning is considered polite, but we discussed it overnight. However, after all, this kind of situation has never happened before, and the final result of the discussion is to hope that you can reduce your position in our seat, and then we will issue a bearish report, which should be almost the same.”

  His last sentence was extremely unconfident, obviously expressing a pessimistic attitude towards the current situation. He knew very well that with the report level of their research department, it was difficult to convince the SEC group, and it was also difficult to explain holding so many short positions. In fact, even within HSBC, it is difficult to understand that Zhongshi has so many short positions on the funds. They discussed it in private and finally concluded that it is manipulating the market.

Saying this passage will naturally offend Zhong Shi greatly, but Gu Zhangli can't care so much at this time. If HSBC North America is brought into the dock, it will not only be the business of the brokerage department, but even the business Banks' business will also be hit hard.

"That's it!" Zhong Shi touched his smooth chin, and continued with some disinterestedness, "I have prepared a research report here, which is designed to deal with this kind of situation. I believe that with this, people like the SEC should I won’t say anything. In addition, register a few more offshore financial companies for me, and transfer some short positions to these companies, so that the positions in a single account will not be so glaring. Besides, you can consider splitting positions !"

  Splitting positions means borrowing positions from other brokerage firms, so that the number of positions held by their seats will not be astonishing, but borrowing other people's seats will naturally cost a part of the commission.

This is naturally a way. Gu Zhangli frowned and thought for a while, and then made a seemingly extremely rude request: "Zhong Sheng, can I read your research report first?" It was too much, and hurriedly avoided Zhong Shi's gaze.

It is basically impossible for such a private research report to be leaked, otherwise it would be very troublesome to be targeted by others. Besides, Zhongshi is now a big player in the market, and his operation direction and strategy must be kept strictly confidential, otherwise It may also cause the follower to operate in the same direction, and then it will be a money grab from Zhongshi.

  Large research institutions are happy to publish this kind of research report, firstly, they can make money, and secondly, they can cooperate with their self-operated business to cause a herd effect. Naturally, they generally release macro-level reports and do not target specific varieties or individual stocks. Even if they do, they will at most release reports with words such as target price, "recommended to reduce holdings", "recommended to increase holdings" .

To Gu Zhangli's surprise, Zhong Shi actually agreed: "Of course, you can read this report first. If you are satisfied, you can even publish it in the name of the HSBC research department." After leaving the room, he printed out the "research report" that had been stored on the computer for a long time.

Contrary to Gu Zhangli's idea of ​​trying to avoid the lawsuit, Zhong Shi is trying to drag HSBC into the water at this time, so that he will face less pressure, and publishing the research report in the name of HSBC Futures Research Department That's what it means.

At this time, the performance of the computer is far from being comparable to that of later generations. Zhong Shi’s computer is still using the Linux system, and the corresponding file system is far from easy to use. The paper, which still exuded a faint scent of ink, was handed over to Gu Zhangli.

"With the progress of European monetary integration, the trade among countries will also grow rapidly. In addition, the UK, which broke away from the European exchange rate system, has lowered its exchange rate, which has led to an increase in exports and a significant improvement in economic data. The growth rate is expected to be around 2% this year. ..."

"In the United States, the economy continues to be in a downturn. Since the Clinton administration came to power, it needs to stimulate the economy in terms of liquidity and the value of the dollar. For this reason, the Fed lowered short-term lending rates to stimulate the economy, but it remains to be seen whether this will cause inflation, but Judging from the published data, the U.S. economy is gradually recovering..."

"In the recovery process of the two major economies of Europe and the United States, oil production, one of the important resources, will not experience large fluctuations in the short term. Even if OPEC believes that the current oil price is too low, once they make a decision to cut production behavior that will greatly harm the world economy..."

"From the perspective of OPEC, even if some original exporting countries have proposed to cut production, they believe that the current oil price is too low and hurt their interests, but once the production cut is implemented, it will produce an oil crisis similar to the 1970s. At that time, it may cause serious harm to the world economy, such as stagflation, and eventually because of the decline in the world economy and the reduction in demand, oil prices will further decline on the basis of the current price."

"Therefore, in the long run, OPEC is unlikely to reduce production, and may even increase production appropriately. Therefore, corresponding systemic risks arise in the crude oil futures market. The current general market reaction to crude oil prices is low, so The expectation of OPEC's production cuts makes the bulls hold excess positions, and even some hedging accounts have similar expectations and operations, so shorting before the OPEC policy comes out will be a very noteworthy direction of operation."

"It should be noted that one must always be alert to price fluctuations in the spot market. After all, if the bulls get the news in advance, they are likely to drive up the price of the futures market through operations in the spot market. Hedge."

"The above analysis report is for reference only, and does not bear any legal responsibility." After reading this eloquent research report with tens of thousands of words, Gu Zhangli was completely speechless. How could this be a private research report? Ah, clearly a standard long-term bearish crude oil futures report, even with a disclaimer at the end. According to the statement in the report, all the operational basis is based on the fact that OPEC does not cut production. If OPEC does not cut production in the end, then this report is undoubtedly very forward-looking. If OPEC finally announces the decision to cut production, then this The report is a joke.

In any case, this report is enough to explain to the SEC the motivation for establishing so many short positions. I believe that the SEC will not think that HSBC's crude oil research department has the means to know in advance OPEC's decision on crude oil production. Gambling bets.

   "Should I send it?" Zhong Shi on the side watched Gu Zhangli's face change one after another, and he couldn't make up his mind for a long time, so he couldn't help but urge him.

   "Send!" Gu Zhangli thought and thought, suddenly made up his mind, and almost yelled out. He knows that once this report is released, if OPEC finally cuts production, the HSBC crude oil futures trading department will become the laughing stock of the market. But what is that compared to keeping a big client? There are a lot of unreliable research reports on the market, and this one is quite a few!

   Thank you book friend someonepp556 for your monthly ticket support! Thanks for another tip that made me think!

  (end of this chapter)