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Text Chapter 801 The Arrogant International Speculator

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    Feeling that he was almost done swimming, Liu Ningqiang climbed up from the swimming pool and wiped it randomly. Just as he was about to go back to the room, he saw Ge Hongrui walking over in a hurry. His face was a little solemn, and he seemed to be nervous and anxious.

    "Director Ge, is something wrong?" Liu Ningqiang asked quickly, feeling a little surprised.  As the chief financial advisor of the Central Committee of the State Council, Ge Hongrui is usually very dignified and steady, and he is not hasty or impatient in his work. He has the demeanor of a scholar, but what happened today that made him so out of control?

    Liu Ning felt strong and seemed to have some consciousness.

    "President Liu there is something has happened" Ge Hongrui seemed to be walking a little hastily, and he was breathless when he spoke: "Soros and international speculators have taken action"

    "Well, it's finally here! What's the situation now?" Liu Ningqiang's eyes flashed with excitement.  After holding back for so long, it is better to finally see the real chapter than to suffer in waiting.

    But obviously Ge Hongrui was not as excited as he was. He frowned and said in a deep voice: "Just like when the Thai baht was attacked, the Hong Kong dollar has suffered a massive sell-off, and the ratio to the US dollar is falling rapidly."

    Liu Ningqiang didn't even bother to change his clothes. He waved his hand and said, "Let's go back to the room. Immediately notify everyone to come back for the meeting."

    The situation is indeed serious.  It is completely different from the first tentative attack in August. This time, it seems that the "Quantum Fund" and a large number of international speculators are relying on their abundant funds. They have not held back at all, and they have struck hard at once.  The emergence of huge selling orders caused the Hong Kong dollar exchange rate on major exchanges to plummet, and soon fell to near the psychological mark of 7.75.

    The Hong Kong Island government has implemented a fixed exchange rate system that closely follows the US dollar, which is very beneficial to stabilizing the financial market and promoting Hong Kong's economic development.  Over the years, the exchange rate of the Hong Kong dollar against the US dollar has been relatively stable, and this exchange rate has become a barometer and reference for the stability of the financial market.

    Therefore.  The continued decline in the exchange rate of the Hong Kong dollar against the US dollar immediately caused chaos in the financial market on Hong Kong Island.

    A few months ago, the financial turmoil swept across Southeast Asia, everywhere it went.  Tragedy spread across the country, and many middle-class people went bankrupt overnight. The once wealthy and respectable families suddenly turned into abject poverty, and even were heavily in debt.  These bloody realities have constantly impacted the already tense nerves of the people of Hong Kong Island.  With these painful lessons from our neighbors, the citizens of Hong Kong Island are like frightened birds, already panic-stricken.  Afraid that the same misfortune would befall him, his psychological endurance has become extremely fragile, and even some plants and animals are in danger.  Therefore, as soon as the financial market showed signs of collapse, citizens immediately became confused and rushed to major banks to exchange the plummeting Hong Kong dollars for US dollars.

    The lessons learned from Southeast Asian countries such as Thailand show that they are under the impact of extremely powerful arbitrage funds and international hot money.  Sooner or later, the Hong Kong Island government will be unable to resist and abandon the fixed exchange rate.  In this way, the savings they have worked so hard to accumulate.  will shrink significantly.  Therefore, everyone wants to quickly convert their coins into US dollars to preserve their value.

    Since the implementation of a fixed exchange rate, the Hong Kong dollar has experienced a crisis for the first time.

    Hong Kong Island is a financial city. The stability of the financial market is crucial to the economy of the entire market. Maintaining a fixed exchange rate is to maintain people's confidence.  The Hong Kong Monetary Authority immediately made a tough response. Under the coordination of an expert team, it mobilized Hong Kong, Chinese and British capital to enter the market urgently, intervened forcefully, and accepted a large number of Hong Kong dollar selling orders.  Started a confrontation with the opponent.

    Because the strong intervention of the SAR government has achieved the expected results, the Hong Kong dollar exchange rate has begun to stop falling and rebound, and the run on major banks has been temporarily alleviated.

    But just two days later, more selling orders poured into the market, and the Hong Kong dollar exchange rate fell below the psychological mark of 7.75.  Rapid decline.  The run that had just eased slightly emerged again, more intense than the last time, so much so that the SAR government had to deploy a large number of police to maintain order and urgently allocate positions to deal with the run and avoid bank bankruptcy.

    But just when the SAR government and the expert group mobilized about 100 billion Hong Kong dollars to invest in the foreign exchange market to stabilize the Hong Kong dollar exchange rate, the stock index fell rapidly at this time.  The Hang Seng Index fell sharply from 10,000 points to 8,000 points, and pointed directly at 6,000 points.  When the storm was about to come, bad news was flying all over the securities market. Speculators took the opportunity to spread rumors, threatening that "the RMB can no longer withstand it and will depreciate soon, and will depreciate by more than 10%" and "the Hong Kong dollar will be decoupled from the US dollar and depreciate by 40%."  %", "The Hang Seng Index will fall to 4,000 points" and so on. Their purpose is nothing more than to disturb people's hearts, create a "herd mentality" and then take advantage of troubled waters.  The ¡°tear down¡± trend is shocking.

    At this time, everyone suddenly realized that Soros and international speculators were only superficially attacking the Hong Kong dollar. They were not only aiming to make profits on the Hong Kong dollar exchange rate, but alsoAnd adopt a comprehensive strategy to benefit from the stock market and futures market. The stock market and futures market are the real main targets. Attacking the east and west is Soros's consistent method of speculative activities, and has been successful many times.

    The Hong Kong dollar implements a linked exchange rate system. The linked exchange rate system has an automatic adjustment mechanism and is not easy to break.  However, Hong Kong dollar interest rates are easy to rise sharply, and a sharp rise in interest rates will cause the stock market to fall sharply. In this case, as long as you sell short in the stock market and futures market in advance, and then borrow a large amount of Hong Kong dollars from banks, causing Hong Kong dollar interest rates to rise sharply and causing the Hang Seng Index to plummet, you can  Make speculative profits just like in other countries.  Soros and international speculators once again used hedge funds to continuously attack the Hong Kong dollar to push up interest rates and interest rates. When the Hong Kong government took measures to significantly raise interest rates in response to attacks on the Hong Kong dollar, the stock atmosphere turned dim and people were worried about a sharp rise in interest rates.  Pushing down the stock market and property market, people took advantage of the situation to sell futures, causing the futures index to plummet.  As a result, people in the stock market are panicked and sell stocks in a panic, allowing speculators to close their short positions and obtain huge profits.  In other words, even if they had no success or even made small losses on the Hong Kong dollar exchange rate, they still made a fortune in the futures market.

    While suppressing the Hang Seng Index, international speculators accumulated a large number of short positions in the Hang Seng Index futures market.  Every time the Hang Seng Index falls by 1 point, you can earn HK$50 per short position contract.  In these 19 consecutive trading days, the Hang Seng Index plummeted by more than 2,000 points. Each contract can earn more than 100,000 Hong Kong dollars. The income is jaw-dropping.

    What should we do now?  "The voice was not loud, but it could not hide the confusion in it.

    The speaker was Fan Xiangchen, CEO of the Hong Kong Monetary Authority.

    He felt very heavy and his face was filled with gloom.  His eyes were bloodshot, and it was obvious that he hadn't slept well in the past few days.  It¡¯s no wonder that the financial market on Hong Kong Island has been attacked by international funds and hot money led by the ¡°Quantum Fund¡±, and has almost reached the brink of collapse. He, the first director of the Hong Kong Monetary Authority after the return, is naturally anxious.

    This is not the Hong Kong Monetary Authority, but the room of the expert group on the 38th floor of the Lam Consortium International Hotel in Hong Kong.  In addition to Fan Xiangchen, present were Liu Ningqiang and Ge Hongrui, the chief and deputy leaders of the expert team.

    As expected by an outside media, the expert group and the Hong Kong government set up a temporary operating room in the hotel, equipped with the most elite traders in Hong Kong Island, and established a small but capable trading team for the expert group to command.  use.  This is the headquarters of Hong Kong Island's fight against "Quantum Funds" and international speculators. All instructions are issued from here. Hundreds of billions of Hong Kong dollars of funds are also deployed here to be active in the Hong Kong Island foreign exchange market to fight against these crazy investors.  International speculators, safeguard the financial order of Hong Kong Island.

    The room was filled with smoke, and everyone was in a very heavy mood. They were smoking, and their faces were ugly, so gloomy that they could almost squeeze out water.

    Although hedge funds are often constrained by the traditional approach of Hong Kong¡¯s financial regulatory authorities when they impact Hong Kong Island¡¯s financial market¡ªraising short-term loan interest rates.  Facts have proven that raising short-term loan interest rates will increase the costs for speculators, because they usually borrow Hong Kong dollars from banks on Hong Kong Island and then sell them in overseas markets.  By "hijacking interest", the Hong Kong government has easily cut off the supply of international speculators, leaving them unprofitable and instead paying huge interest payments.  But when speculators hit the Hong Kong financial market this time, the biggest difference from the past is that the speculators did not carry out spot lending activities, but accumulated a large amount of Hong Kong dollars in advance, making the Hong Kong government's "interest-bearing" measures ineffective.  Some effects.

    ¡° Moreover, the side effects of raising short-term loan interest rates are becoming increasingly obvious, and it is too damaging to the stock and property markets.  A drop in the Hang Seng Index to 6,500 points will be the lowest the banking system can bear.  Experts analyze that if the stock market and property market fall further, banks will have no choice but to sell off a large number of related mortgage assets, thus setting off a vicious selling wave in the stock market and real estate market. Some small and medium-sized banks may even collapse due to excessive bad and bad debts.  Facing the fate of bankruptcy.  Once a bank begins to fail, Hong Kong's banking system will inevitably suffer a fatal chain blow.

    If the Hong Kong government does not "hijack interest rates", speculators will take the opportunity to borrow more Hong Kong dollars to prepare for a greater impact next time.  If the Hong Kong government's plan to "hijack interest rates" from speculators succeeds immediately.  Therefore, in this dilemma, the expert group and the Hong Kong government had to rely on their abundant foreign exchange reserves to fully accept the Hong Kong dollars sold by speculators in order to maintain the linked exchange rate and the foreign exchange market.  However, under the influence of high interest rates, the economy paid a high price. Interest rates remained high, the stock market and the property market fell sharply, and the economic vitality was severely damaged.  However, the stock market continued to plummet. In just 19 trading days, the Hang Seng Index and futures index fell by more than 2,000 points. International speculators had a great victory. They arrogantly nicknamed Hong Kong Island their "super cash machine" and claimed that  Hong Kong Island must be defeated.  (To be continued!~!

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