Video Game Empire - Chapter 691

The magnificent 1992 is fleeting, and the new 1993 is coming soon. After 12 years of Republican domination, the White House in Washington has finally welcomed a new Democratic president. Clinton’s luck is still quite good, he just took office and picked up a big bargain. The U.S. economy is rapidly coming out of recession and regaining high-speed growth as emerging industries such as the Internet continue to sound the horn of charge.

Since AOL (AOL) was listed on Nasdaq in the middle of last year, there have been 11 Internet companies in just one year, and a total of more than 3 billion US dollars has been withdrawn from the US stock market.

Therefore, Clinton’s first worry after becoming president was not worrying about a sluggish U.S. economy, but having to consider whether the U.S. investment is overheated. The U.S. economy has been implementing loose monetary policy for the last three years after it gradually fell into a trough in eight or nine years. Adequate money supply not only fuels the bull market in U.S. stocks that has lasted for nearly a year, but may also lead to further inflation.

So in early August, Federal Reserve Chairman Greenspan announced that the US federal benchmark interest rate would increase by 0.25%, from the original 3.25% to 3.5%. After testing the market response with the smallest rate hike, the Federal Reserve announced that it will gradually increase the interest rate from a low of 3.25% to 6% in the next year, and the United States has officially entered a new round of interest rate hikes.

The US dollar is the core currency of the global financial system, and its every move will have a chain reaction. First, the U.S. interest rate hike means that the domestic return on capital becomes higher, the dollar starts to appreciate, and a large amount of outflow capital begins to flow back to the United States.

The exchange rates of many countries and regions are pegged to the US dollar, and the appreciation of the US dollar means that the currencies of these countries and regions will appreciate synchronously, which directly leads to soaring export costs. The accelerated return of US dollars to the United States will lead to the rapid loss of US dollar foreign exchange in other economies. Once the foreign exchange reserves of these countries and regions are exhausted, their exchange rate systems will collapse completely.

Less than half a year after the US announced a rate hike, the first victim appeared – Mexico!

“The Mexican peso is gone, and this financial crisis will soon bring more spillover effects. Next, Brazil, Argentina, and the whole of South America will be sheared by Wall Street!” Li Xuan glanced at the electronic screen sent from the United States The latest piece of information, and swept the crowd hugging and carnival in the operating room, and said with a slight sigh.

Just three minutes ago—Mexico time at 11:28 on March 29, 1994, the Mexican government officially announced that the peso would abandon the three-year fixed exchange rate system, and the floating range of the exchange rate against the U.S. dollar would be expanded to 15%. Means the peso will be devalued.

The Mexican currency crisis started last August when the Federal Reserve announced a U.S. dollar interest rate hike. In the three years before the U.S. began to raise interest rates, due to the loose fiscal policy in the U.S. and the low U.S. dollar interest rate, a large amount of profit-seeking U.S. dollar capital flowed into the global market.

And America’s neighbor, Mexico, is one of the biggest beneficiaries of this round of dollar flooding. In just a few years, Mexico has attracted more than $90 billion in foreign investment. As the U.S. dollar enters the interest rate hike cycle, more and more international investors choose to leave Mexico and return to the U.S. capital market.

This quickly drained Mexico’s limited dollar foreign exchange reserves, just a week after the assassination of Donald Carlosio, the presidential candidate of Mexico’s Institutional Revolutionary Party, who was widely expected to win this year’s presidential election in Mexico candidate.

This political crisis completely triggered the panic of international capital, and countless coins were thrown one-way at the Mexican Central Bank. In the past three days, the Mexican government has poured $4 billion into the foreign exchange market to stabilize people’s hearts, but to no avail.

Therefore, the Mexican government, which is incapacitated, can only announce that the exchange rate of the peso against the US dollar will increase by 15%, and ease the pressure on the exchange rate by letting the peso depreciate moderately. But this is only the prelude to the collapse of the peso, because even if the peso depreciates by 15%, the dollar reserves in the hands of the Mexican central bank are still far from enough to exchange all the peso sold by foreign investors.

Therefore, the floating range of the exchange rate of the peso against the US dollar will continue to increase to 30%, 50%, and finally achieve free floating!

The reason why everyone in the operating room cheered wildly is because this speculative team serving Li Xuan, like the international hot money that attacked the peso exchange rate this time, sold a large amount of Mexican pesos early. The next devaluation frenzy of the peso will not only bring a considerable amount of profit to Li Xuan, but will also give everyone present a surprising bonus figure!

“Axuan, I remember you said before that the whole of South America is the back garden of Wall Street capital. The biggest investors in Mexico, Argentina, Brazil are originally Wall Street, and this time a lot of American capital is destined to be locked up. , how to shear wool?” Li Xuan’s elder brother Li Ke asked with a frown.

He is also one of the small bosses of this speculative team, so today, together with Li Xuan, we witnessed the collapse of a country’s currency.

“Hehe, you are still too simple! There is a bible in the capital world, as long as you outlive the enemy, you will be the ultimate winner. And no matter how much you have lost before, you will be able to earn twice as much in the end!

The Mexican government has turned to the International Monetary Fund and the U.S. government for help long before the peso crisis broke out. As a close friend of Mexico, how could the United States die? So it won’t be long before you’ll be on the TV news and you’ll see President Clinton announce that the United States is going to send huge amounts of money to the Mexican government!

It’s just that these US government funds will only be used first to rescue US banks and US investors trapped in the quagmire of Mexico. As for the Mexican counterparts, they can only die tragically in the severe inflationary deflation. And when they’re cool enough, the Americans just regain their strength and enjoy these delicious corpses!

For Wall Street, the current exchange rate losses are an illusion! They will soon help Mexico recreate another round of economic growth, and when the peso exchange rate returns to normal levels in a few years, there will be time to slowly cash out and retreat! “Li Xuan explained indifferently.

“By the way, the linked exchange rate of our Hong Kong dollar seems to be the same as the Mexican peso. It is pegged to the U.S. dollar in a small range! The international financial giants such as Soros you mentioned earlier will come to Hong Kong one day to make trouble?” Li Ke asked in hindsight.

“You finally got the idea, so I specially asked you to take a look today, the routine of greeting others, lest the guests not know when they arrive at the door!” Li Xuan said with a laugh.

“Do they really dare to come?” Li Ke asked in surprise.

“Why don’t you dare? Back in 1992, Soros even dared to touch the pound’s beard, and finally managed to escape smoothly, not to mention Hong Kong, a British colony!” Li Xuan said with a sideways glance at his eldest brother.

“Da Lisheng, Hong Kong’s economic fundamentals are much better than Mexico’s, and there will be no major problems for the time being! On the contrary, Thailand, Indonesia, Malaysia, and other Southeast Asian countries are currently in a similar predicament to Mexico!

Especially in Thailand, if you use an idiom to describe it, it is in danger! “The person in charge of this operation room is also the boss of the entire Hong Kong speculative team, a middle-aged man with a somewhat fat body, and explained to Li Ke seriously.

There are many billionaires surnamed Li in Hong Kong, and even if they are worth more than 10 billion, there are more than one. But because of the jade pearl Li Xuan, the word “Li Sheng” seems to have become his proper noun in Hong Kong. The only exception is Li Ke. As the eldest brother of “God of Wealth Li”, he enjoys being called “Big Li Sheng” by others.

“Since the burst of Japan’s stock market and property market bubbles in 1990, a large amount of domestic surplus capital has been exported overseas. Among them, Southeast Asia has been the focus of Japan’s investment in recent years, which has promoted the rapid growth of the entire Southeast Asian economy!

The local markets of Southeast Asian countries are small, and the excess supply brought about by high investment can only be absorbed by exports! The exchange rate of the Thai baht is also pegged to the US dollar, so the Thai baht has been synchronizing with the US dollar since last year, which has begun to affect the export competitiveness of Thai products. “Li Xuan explained.

“The Thai baht exchange rate has been pegged to the US dollar since 1984. Due to the stable exchange rate and the domestic interest rate in Thailand is much higher than that of the United States, it has attracted a large amount of foreign investment in the past ten years. These international capital mainly invested in industries at the beginning, which has indeed promoted the Thai economy. development of.

However, in recent years, these international capitals have been transferred to the real estate and securities markets in large quantities, which not only drove the Thai stock market to rise sharply, but also continued to push up the housing prices in Bangkok! With the Federal Reserve raising interest rates and the appreciation of the US dollar, Thailand also experienced a large-scale wave of cash withdrawals!

In order to stabilize the exchange rate, the Thai government keeps selling dollars to the foreign exchange market on the one hand, while the other side raises interest rates synchronously with the dollar, and wants to use higher domestic interest rates to retain foreign capital! This combination of punches did have an effect. With a large amount of new foreign capital entering Thailand for arbitrage, Thailand has regained its net capital inflow!

However, the increase in bank interest rates will create new problems, that is, greatly increase the financing cost of enterprises. This is tantamount to making things worse for Thailand’s already sluggish export economy!

It is impossible for the interest rate to increase indefinitely, and these new hot funds will quickly choose to leave once they find that there is no room for subsequent arbitrage! Until then, the current tragedy in Mexico will be staged again in Thailand! The person in charge of Wei Chuan took over Li Xuan’s words and continued to explain.

Don’t look at his honest and honest appearance, but the flashes of light in his eyes made Li Ke shiver.

The entire team responsible for speculating on the Mexican peso this time, in addition to the 20th or 30th people in the operating room in Hong Kong, has almost the same number of people in New York, the United States. In this Mexican currency crisis, Hong Kong is only responsible for providing some auxiliary work for the New York team. In the next Asian financial crisis, they will in turn become the protagonists.

“Just as the economic crisis in Mexico will spill over to the whole of South America, the financial turmoil in Southeast Asia will also spread to the whole of Asia! When the problem occurs in Thailand, Indonesia-Nepal and Malaysia will suffer first, and Hong Kong, Taiwan-Taiwan, and South Korea will also be affected!

Therefore, the company in your hand should take it easy, don’t over-expand, if you really want to invest, go north to the mainland! “Li Xuan exhorted.

“Will there be no problems in the mainland?” Li Ke asked curiously.

“One of the reasons why the Mexican peso fell in just one week this time is that the Mexican capital market is completely open to foreign investors and can come and go freely! Therefore, there will be a large amount of panic effect. However, the Chinese capital market is different, and foreign capital is strictly regulated!

Every capital has a special purpose after entering China. For example, if you invest in a joint venture factory, you will be liable for breach of contract if you withdraw your capital before the contract ends! Even if the contract is over, if you want to withdraw funds from China with interest, you still need to go through a strict review by the relevant financial departments!

What’s more, the interest rate of RMB is also under the control of the People’s Bank of China, and foreign hot money has no ability to short China at all! The only problem that China needs to be under pressure is that the Asian financial crisis has led to a decline in demand in the global market, which will greatly shrink the output value of exports and slow down the overall economic growth!

This is called pulling one hair and moving the whole body. After the outbreak of the Asian financial crisis, the mainland economy will definitely usher in a trough for a year or two! But after all, this is a huge market with a population of more than one billion, and many problems can be solved as long as a part of domestic demand is released!

What’s more, the core of the global economy is still the European and American markets. As long as there are no major problems in the European and American markets, the global economy will soon get out of the trough! “Li Xuan explained patiently.

“I understand what you mean. After the Americans have finished cutting the South American back garden, they are going to come back to the Asian garden to cut vegetables!” Li Ke said with a sigh.

His companies, whether it is Starlight Paging or Family Fun Pictures, have been increasing their share of the Southeast Asian market in recent years. And after the financial crisis, the entire Southeast Asian chicken feathers, the blow to the various companies under Li Ke’s name can be imagined.

A few years ago, he was not very interested in Northward to expand the mainland market~www.mtlnovel.com~ Now it seems that he is still too proud! No wonder Dongfang Group has made more and more moves in the mainland in the past two or three years. My younger brother must have anticipated the current situation!

Li Ke couldn’t help but feel a little discouraged! But fortunately, his mentality has always been very good. My brother is 10,000 times smarter than himself. This fact is not only known today, so Li Ke quickly adjusted his mood!

In fact, not only Li Ke’s company has a lot of interests in Southeast Asia, but even the Oriental Group itself has a lot of involvement in Southeast Asia! Among them, the profit brought by the Southeast Asian market to the Oriental Group is only on the one hand, and on the other hand, many enterprises in the industrial chain of the Oriental Group are located in Southeast Asian countries.

In the era of collaboration in the global division of labor, neither Li Xuan nor Dongfang Group can survive alone. Therefore, before the crisis came, Li Xuan could only try his best to guide his partners to quickly reduce the asset-liability ratio to reduce risks, and at the same time persuade some Southeast Asian capital to go north to invest in a safer mainland!

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