The Son of Finance of the Great Age

  Chapter 830 Portugal's debt crisis (2)

Although the resignation was threatened, this financial cut plan was too harsh and was bound to offend most classes. Therefore, during the final vote in Congress, members of the opposition party rejected the proposal without hesitation. proposal.

  Originally in the Congress, the ruling party did not occupy the majority of seats. It can be said that this is a lame government. Now that he has seriously handed over the blame, the opposition party unceremoniously slapped the prime minister in the face.

   Resigning a prime minister is easy because the next replacement is easy to find. And if the people are offended and votes are lost, the consequences will be absolutely disastrous, and the opposition parties are very clear about the stakes.

  The result was obvious. On the second day after the proposal was rejected, Soragedi submitted his resignation letter to the Portuguese President, officially announcing his resignation.

  He also kept his word.

  According to Portuguese law, if the head of the government resigns, a general election can be held within the next 55 days to re-form the government. During this transition period, officials from the previous government still hold relevant positions to ensure the stability of the country and the smooth progress of government affairs during this period.

  The collapse of Socrates' cabinet immediately caused a chain reaction.

   The first to respond to this was Fitch, which downgraded Portugal's sovereign credit to A- on the second day, with a negative outlook. Immediately afterwards, Standard & Poor's also followed up on the 29th and lowered Portugal's sovereign credit rating to BBB-. This is the second consecutive week that Standard & Poor's has adjusted Portugal's debt situation.

  At the same time, whether the new Portuguese government can continue to strictly support and implement the three austerity programs previously passed by the Portuguese Parliament has also become the focus of market attention. After all, once the emperor and the courtiers, everything is unknown until the new government emerges.

  In this case, the performance of Portugal's national debt can be imagined. The yield on the five-year Treasury bond has soared, approaching the 9% level. In terms of ten-year government bonds, it pointed directly at 10%, far exceeding the performance of other government bonds in the market.

In terms of CDS, Portugal's sovereign CDS has soared to 600 points, that is, if you want to invest in a position of 10 million euros, you need to spend 600,000 euros to buy related credit swaps, and at the same time, you must pay a certain amount of insurance every year cost.

  In a word, because of political instability, Portugal's external environment has deteriorated rapidly.

What happened next was a matter of course. People from all walks of life jumped out one after another, including economists, politicians, entrepreneurs, trade union representatives, and ordinary people. They each made specious comments on the current economic situation, and then discussed Portugal’s acceptance of Possibility of EU aid.

   When the people decide, one political party stands out, namely the Socialist Party, which was previously in power. Their former leader, the former prime minister and now the prime minister of the transitional government Socrates, uncharacteristically stated that Portugal needs the assistance of the European Union.

  At the same time, the rivals of the Socialist Party, the Social Democratic Party and the Social Democratic Center Party, also stated that seeking external assistance has become the only way out for Portugal at present. At the same time, they lashed out at the previous administration, which they hold fully responsible for today's situation.

   Not showing any weakness, the Socialist Party also launched a merciless attack on the Social Democratic Party, trying to blame the other party for the blame. A large-scale debate took place between the two parties for the next general election.

   But no matter how chaotic the situation is, the three major political parties have at least one thing in common, that is, Portugal can only get out of the difficulties through external rescue, and the caretakers of the three parties soon reached a consensus on this point.

  On April 7, Portugal formally submitted a rescue application to the European Union. After Greece and Ireland, Portugal became the third country in the euro zone that had to seek foreign aid due to its heavy debt.

   After more than a month of negotiations, before the general election, the transitional caretaker government, the EU and the IMF reached a rescue plan.

  In this aid package, the European Union and the IMF will provide Portugal with a total of 78 billion euros in loans in the next three years. It is ironic that in this plan, the conditions put forward by the EU and the IMF include requirements such as tax increases, freezing pensions and wage growth, reducing unemployment benefits and shortening the payment time, which is almost the same as the fiscal policy originally proposed by the Socialist Party. Curtailment plan consistent.

   But what is even more surprising is that the three major political parties in Portugal, including the Social Democratic Party, have stated that once they come to power, they will strictly abide by the aid terms.

  In the fiscal cut plan proposed by the Socrates government, the Social Democratic Party was the main opposition force.

   So far, Portugal's debt crisis has officially come to an end.

For nearly half a year, under the amalgamation of various forces including hedge funds, rating agencies, international investment banks, the ruling party, opposition parties, the European Union and the IMF, the Portuguese government finally had to accept external assistance at the cost of an early change of term. .

   "Aid is finally accepted!"

On the plane flying to Toronto, Zhong Shi received the news that the Portuguese transitional government bowed his head. He couldn't help but sighed and said, "After working for so long, I still have to bow my head in the end. I really don't know what these guys think. .”

  If the Portuguese government chose to accept external aid at the beginning, then there are not so many things going on. But the fact is by no means that simple, because they were afraid of power interference, they had to choose to deal with it toughly, but they were finally defeated by the market. But this back and forth, nearly half a year has passed.

  The time cost of nearly half a year will be borne by ordinary Portuguese people.

   "Zhong Sheng, your prediction of the situation is really amazing!"

Jiang Shan, who was traveling with him, didn't have the slightest awareness in this regard, he just kept complimenting Zhong Shi and said, "Things are developing exactly as you expected before, and you haven't made a single step wrong. God, you are really amazing. If we had participated in the Portuguese speculation, perhaps billions of euros would have been booked."

   "It's just a few billion euros. You only see the immediate benefits, but you don't see the long-term harm!"

Zhong Shi was very speechless, put down the documents in his hand, and said solemnly to Jiang Shan, "Think about it, we did it once in Greece, we did it again in Ireland, and now it is Portugal. time?"

   "Three times!"

Jiang Shan scratched his head, not understanding why Zhong Shi's tone became serious, and he replied carefully, "So far, we have been successful every time, haven't we? As long as this strategy can continue, we will resolutely There's no reason to give up."

   "You're still too young!"

Zhong Shi patted his forehead, and said with some annoyance, "There is a proverb in China, which is called one but two but not three. It means that for excessive things, you can do it once or twice, but you can't do it a third time. Because quantitative changes cause qualitative changes.”

"Although so far, our team has not had a crisis. But the same method has been used three times, and the targets are countries in the euro zone. I think the second time, it aroused the vigilance of the EU. Especially in the In May of last year, the whole of Europe was in turmoil because of this, if they hadn't launched the EU rescue mechanism in time, I am afraid the situation would be difficult to deal with."

   "So you deliberately quit Portugal's short-selling, because you want to leave yourself a little room to retreat?"

  Jiang Shan suddenly realized, and understood why Zhong Shi quit the activity of shorting Portugal, "But if you do this, isn't it a bit too worrying?"

   "Worry?"

Zhong Shi smiled, and said disapprovingly, "I don't think so. You must know that there are more than one or two related warnings. Investigating Goodman, targeting rating agencies and even investigating their branches in London, This is all pressure from the EU on the United States. Under such circumstances, if you don’t know how to advance or retreat, you are looking for death.”

"That…"

Jiang Shan was at a loss for words for a while, but he was still not reconciled, and said, "But so far, the debt crisis still has a tendency to spread to Spain, Italy and other countries. At least for a while, the US government will be inseparable from us, won't it? In this case, we have an extra umbrella, don't we need to worry so much?"

   "Can you be sure that the crisis will spread to Spain or Italy?"

Zhong Shi’s light words immediately made Jiang Shan speechless, “At least I am not sure that the crisis will spread to Spain or Italy. I think there will be two opinions in the market now. The first is that the debt crisis will stop here The second is that it will continue to spread, even to large economies such as Spain or Italy. But before the situation is clear, everything is hard to say, and the protection of the US government is not so sure."

"how?"

  Jiang Shan was taken aback, and asked quickly, "Do you think the US government has the idea of ​​killing donkeys, or have you noticed something?"

   Regarding the attitude of the US government, Zhong Shi and Jiang Shan have always had a clear understanding that everyone is using each other. The U.S. government provided Tianyu Fund with legal protection, driving institutions such as Tianyu Fund to set fires everywhere in Europe.

   This is a very dangerous cooperation, but Zhong Shi is not easy to deal with. He is confident that he can get what he wants in this kind of cooperation, so he is willing to be driven by the other party. But this doesn't mean that he doesn't have the consciousness of being a dead dog. In fact, he is very aware of it.

   "Not yet!"

Zhong Shi said lightly, "At least so far, I have not seen the sign of the end of this crisis, which also means that I have not lost my role, so I will not be abandoned by the US government in the short term. But this cannot Say something, because the deeper we get involved, the more retaliation we face from the European side, that's obvious."

   "Only by strengthening cooperation with the United States can we have enough capital to survive in future counterattacks. Do you understand?"

  Jiang Shan nodded silently.

  The current Tianyu Fund is in a state of blooming flowers and raging fire, and the limelight is almost the same for a while. But even under such circumstances, Zhong Shi's sense of crisis is still so strong, which makes him feel sincere admiration.

   "So what should we do next?"

   He went on to ask, "I mean withdraw completely, or continue to serve as a **** of the US government?"

"hey-hey…"

Zhong Shi rubbed his chin and said with a smile, "It is said that wealth and wealth come from insurance. I think this sentence is so true! Why not continue? At least so far, Tianyu Fund has not been included in the European Union's monitoring list. And at most, I can withdraw to the U.S. market, so even if they want to take action, I am afraid it will be impossible."

   "However, the most urgent task is to strengthen my bargaining chip in the minds of the US government, so that they can no longer treat us like a chamber pot, take it out when they want to use it, and throw it aside when they don't want to use it."

  “Unless we become a company like Goodman and Stanley, it is impossible for us as an overseas hedge fund to get their full support.”

  Jiang Shan frowned, and blurted out, "This is almost impossible, Zhong Sheng, are you sure you can do this?"

   "Who knew!"

  Zhong Shi snorted, with a weird smile on his face.

   Thanks to momoko12, Squinting to Watch the Sun, James Five Wukong, Quanquan Cat, Four-Eyed Prodigal Son and many other book friends who voted monthly! I finally persisted until the last day of this month. I feel that it is not easy. I will continue next month. I hope that friends who still have monthly tickets can give me a final support. I am very grateful~

  (end of this chapter)