The Son of Finance of the Great Age

  Chapter 266 Comprehensive layout

  Here, Soros has attracted the attention of countless media inside and outside the venue, and the scenery is boundless. Correspondingly, there are fewer reports on this annual meeting, and the main topic of this annual meeting is how to stop and save the current Southeast Asian financial crisis.

  In mid-August, the IMF held a meeting in Tokyo. At the meeting, the IMF announced an aid program for Thailand with a total of 17 billion U.S. dollars, with an initial funding of 4 billion U.S. dollars. In addition to the IMF, countries or regions such as Australia, Hong Kong, China, Malaysia, and Singapore have expressed that they will use US$1 billion in the IMF's collective reserves to assist Thailand, and Japan will donate US$4 billion. Indonesia and South Korea, which have smaller shares in the IMF's currency reserves, also pledged $500 million.

  But what is intriguing is that the United States, which has the largest share, and the European Economic Community, the second largest, have no intention of rescue. They insist that Thailand must fully and transparently disclose **OT's forward foreign exchange contracts, otherwise there will be no discussion.

In 1994, when Mexico, one of the most important trade surplus countries of the United States, had a currency crisis and then evolved into a financial crisis, the IMF spent a total of 50 billion U.S. dollars to rescue Mexico, while the U.S. provided another 20 billion U.S. dollars. dollars for financial aid.

   The comparison between the two is very obvious. Obviously, at least part of the IMF's decision-making is aimed at the Asian region.

Although the IMF's aid plan added a series of restrictive conditions, at this time Thailand had no choice but to choose to accept these restrictive economic stimulus and expansion conditions, because the currency crisis spread to the entire Southeast Asian region At that time, no other regions or allies could rescue them in the shortest time, except institutions like the IMF and the World Bank.

  …

It is very interesting that in Soros's speech in Hong Kong, he also specifically mentioned the Hong Kong dollar: "The currency crisis in Southeast Asia is coming to an end, and my fund and I have not participated in the recent regional currency attack. The pegged exchange rate will not be forcibly lowered.” Finally, he expressed optimism: “The currency markets in Southeast Asia will stabilize in the near future.”

This statement made Hong Kong Financial Secretary Cen Yinquan greatly relieved. After Soros made a similar speech, he announced to the outside world: "This means that the currency crisis entangled in Hong Kong is likely to end." At the same time, the mood The excellent Secretary Cen revealed to the outside world that billions of dollars of foreign exchange were used to defend the Hong Kong dollar. Although he refused to disclose relevant details, ordinary people were obviously relieved.

  Is Soros’ remarks in Hong Kong a smokescreen, or his true judgment on the money market in Southeast Asia? The market has speculated about these two possibilities, and opinions vary.

In fact, Soros did think so, and did so. The entire Quantum Fund made a large error in judging the situation of the currency crisis in Southeast Asia. Druckenmiller and his team even established a position as high as US$1 billion Indonesian rupiah bullish portfolio.

  …

At this time, Zhongshi's Tianyu Fund liquidated all Thai baht positions at an average price of 32.5 baht to 1 US dollar, coupled with the profit from the positions in the forward foreign exchange market, making Tianyu Fund's position in the entire Thai baht market The profit exceeded US$1.5 billion, which became the most profitable operation of Tianyu Fund in the entire currency crisis.

Due to the large-scale trading of Tianyu Fund in the market, foreign exchange traders considered that hedge funds withdrew from the Thai baht market. A new high in a week.

  When the final profit figures were announced, the entire Tianyu Fund burst into warm applause. Zhong Shi scratched his head and showed a satisfied smile on his face.

   "Zhong Sheng, shouldn't you say something at a time like this?" Seeing that the applause lasted for a long time, Andrew struck while the iron was hot, urging Zhong Shi to say something to the researchers.

   At this time, it is necessary to properly boost morale. Zhong Shi touched his nose, then stood on a table, pressed his hands down, the applause and cheers stopped immediately, and everyone turned to Zhong Shi, waiting with bated breath.

"Gentlemen, so far, we have earned more than three billion US dollars in profits from the currency crisis in Southeast Asia, making our current capital scale swell to a level of 10 billion US dollars. This is a milestone, and the efforts of everyone here Inseparable." Zhong Shi cleared his throat first, and then said slowly.

  The researchers immediately burst into applause that was even warmer than before, which was mixed with whistles and screams, and the whole scene suddenly became chaotic.

Zhong Shi watched all this with a smile, and did not stop them from venting their composure. After everyone calmed down, he continued, "Although Soros declared that the currency crisis in Southeast Asia is on the verge of ending." Pointing to the convention and exhibition center opposite, "However, what I can tell you is that this is completely nonsense and meaningless. At least from my analysis, the currency crisis is not over at all, and there is a trend of further expansion .”

  The researchers booed in unison, which was naturally aimed at the remarks made by Soros. When Zhong Shi announced that the so-called currency crisis was not over yet, they all burst into applause.

Different from the Quantum Fund, the researchers of the Tianyu Fund know that the capital of the flagship fund that has shined in the recent period comes from internal employees, and every profit of this fund is closely related to themselves, unlike other funds. Hedge funds, whose funds come from clients, can only earn management fees and some excess returns.

  Under such circumstances, it is not surprising that the researchers of the Tianyu Fund regard Zhongshi as more important than the world-famous Soros. In fact, a researcher once made statistics and found that from the public data, Zhongshi’s management performance is obviously better than that of Soros’s funds.

  Although I don’t understand why Zhong Shi has been “deeply hiding merit and fame”, everyone in Tianyu Fund has kept this secret tacitly.

"In the current regional economy, South Korea and Yizhou are both facing the pressure of trade deficits, and South Korea's financial institutions are rumored to have a certain credit risk, and I believe they are relatively tight in terms of cash. According to public figures, South Korea currently has foreign exchange reserves of 33.7 billion U.S. dollars, this number does not guarantee their stable currency value in the foreign exchange market, in fact, from the beginning of the year to July, the Korean won has fallen by more than 7%, this should be the focus of the next international capital attack." Waiting for the cheers to subside Only then did Zhong Shi straighten his face, and said extremely seriously.

Thailand’s exchange rate system is somewhat special. First, it adopted an exchange rate system pegged to the U.S. dollar, and later adopted an exchange rate system pegged to a basket of currencies. Now, on this basis, it has released a certain floating area. This is also the currency of Southeast Asian countries. The general model adopted after the attack, except for countries that have completely liberalized the foreign exchange market, is this model for the Indonesian rupiah, Singapore dollar, and New Taiwan dollar.

"In addition to the currencies that currently maintain a limited floating fixed exchange rate system, other currencies that have left the fixed exchange rate system should also be closely watched. The Thai baht may not have much chance, and the Singapore dollar is unlikely. The Indonesian rupiah will be the next phase of attention Although its floating range has been expanded to 15% at present, it is not practical to maintain the level of 2,800 rupiah from the perspective of Indonesia’s domestic political situation.”

"As for Yizhou, although its central bank warned speculators not to try to speculate in the Yizhou foreign exchange market, and clearly stated that it would take necessary intervention measures when the exchange rate fluctuates significantly. But in my opinion, this is purely a false prestige Although they also have more than 80 billion foreign exchange dollars, with the precedent of BOT, the foreign exchange figures announced by any central bank are questionable and cannot be fully accepted.”

"These regions are economically similar to the countries that were defeated before. When other countries choose to devalue their currencies, their exports will inevitably be affected. At the same time, assuming that the import volume remains unchanged, the status of trade surplus will change quickly, foreign exchange reserves will be depleted far faster than imagined. Remember, the more loudly the area is, the more likely it will be attacked. This is purely a psychological warfare. Central banks are here The role of the foreign exchange defense war in the market is increasingly being questioned, so don’t care too much about the role played by the central bank in the market.”

"For Singapore's currency, I personally think that there is little chance of shorting. Singapore's electronic market is sound, its economic system is sound, and there are no problems in its own domestic situation. The most important thing is that Singapore's exchange rate system is not a fixed exchange rate system, but It is not free floating. The Monetary Authority of Singapore expects the value of the Singapore dollar to be in a certain area, and will intervene in the market no matter whether it rises or falls. Moreover, according to the current situation, funds from Southeast Asia have flowed into the Singapore market to a large extent, which will have a negative impact on the Singapore dollar. Yuan forming strong support."

"Therefore, the next stage will focus on South Korea, Indonesia, Yizhou and Hong Kong markets. The specific direction of operation will be discussed in the first ten days of September. Although you have focused on researching red chips, I believe you are also very tired, but it is not a rest right now. At that time, I ask you to focus on investigating the macro data of these markets in the future, and to closely contact major brokerages, and be sure to form a relevant research report in September."

  He said a lot of things, the central meaning is that the currency crisis is far from over, and the attack of international hot money on East Asia is far from stopping. After Zhong Shi finished speaking, he glanced at the researchers who were in a daze, and suddenly shouted: "What are you doing in a daze? Except for the staff of the Hong Kong Fund, all other researchers have been transferred to the Flagship Fund to study the current research in these areas." Due to the economic situation, except for Hong Kong funds, other funds have temporarily stopped operations, emptied all their positions, and switched to US dollars to wait and see. At this stage, they really have no energy to pay attention to other markets.”

  The researchers came to their senses, hurriedly cleaned up the chores at hand, and began to work. Those who should go to research and study began to ask the front desk to book air tickets, and those who should contact the brokerage made a phone call. For a while, the entire trading area was full of people, and a busy scene appeared again.

   "International hedge funds are really targeting these areas?" Following behind Zhong Shi, Andrew asked Ma Jiarui in a low voice.

   Ma Jiarui was stunned, then looked at Andrew with a smile that was not a smile, and said, "Who is the international hedge fund? We are it!"

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  (end of this chapter)