Chapter 2253 Short abx index
At this time, Solomon had the same idea as countless senior leaders of the hegemony in the previous life. They all believed that Bales and other times were the end of the subprime mortgage crisis. As long as they survived this time, there was a high probability that this obstacle would be over.
As everyone knows, even in the previous life without Chen Mo's interference, Bales and other moments were just the beginning of the subprime mortgage crisis, not to mention that Chen Mo added so much to the subprime mortgage crisis in this life!
So Solomon followed the script written by Chen Mo and went through the plot of bailing out Bells and other companies and buying the bottom of the ABX index.
the other side.
The sun is setting and the stock market is about to close.
Chen Mo put out the cigarette in his hand and calmly ordered: "Close your position and stop shorting Bells and other companies!"
Han Li asked in surprise: "Boss, the stock price of Bells and others has just been cut in half, and panic has just begun to spread. Why did it stop?"
Chen Mo smiled and said: "The foundation and the overlord officials will definitely come to rescue the market, and the intensity will definitely be very large. It is not appropriate to continue short selling.
Besides, our main battlefield is about to start tomorrow, and the main force cannot continue to focus on the stocks of a mere investment bank. That would be too petty. "
Han Li's eyes lit up: "Then what should we do tomorrow?"
Chen Mo's lips curled up slightly: "Short the abx index!"
Han Li's body was shaken!
The abx index, also known as the subprime mortgage bond price composite index or the subprime derivative bond composite index, is a "barometer" of the subprime mortgage market. Its index declines as the risk of subprime mortgage securities assets increases.
Shorting this thing is similar to shorting futures.
From 2000 to January 2008, no financial institution in the world dared to short the abx index!
After all, no one believes that housing prices will fall. Even if they do, financial institutions around the world believe that the hegemonic country can stabilize CDOs and MBSs and will never let subprime bond prices fall.
And just now, the first person in the world who dared to short the abx index appeared! ! !
That is Chen Mo, his own boss! ! !
"As soon as he goes short, he goes short on the most difficult and largest financial instrument in the world. No wonder everyone calls him the "Sky God."
If you are not a god, you really don’t have the courage and courage! "
Han Li said excitedly.
Following Chen Mo's instructions, Han Li carried out the liquidation operation.
All the money is deposited into the company's account, ready for the toughest battle tomorrow.
In the evening, He Chaoling wore a cool and casual summer dress and elegantly held a tray with ice cubes, a fruit plate and a bottle of Chen Mo's favorite wine.
"The third master just sent the information. Bales and others have asked the Federal Reserve Bank for help. I don't know if the foundation will help." He Chaoling said while pouring a glass of wine for Chen Mo who was soaking in the constant-temperature swimming pool in the living room. A few pieces of ice.
Chen Mo drank it all in one gulp and looked at the vast starry sky outside the floor-to-ceiling window:
"The foundation dare not not save it. No one cares about the bankruptcy of Bells and other companies, but no one can bear the negative effects caused by its collapse."
"Tomorrow, whether the official or the foundation, will definitely intervene in a high-profile and strong manner, and will definitely buy the bottom of the abx index to stabilize market confidence."
He Chaoling: "The subprime mortgage crisis is so terrible. All financial assets are experiencing impairment."
Chen Mo nodded: "Well, we are entering the depression stage of financial deleveraging, which is the self-reinforcing liquidity contraction stage. Lenders stop lending, investors withdraw funds, and all financial assets are depreciating. This is the best time. The strategy is that cash is king.
When the subprime mortgage crisis is coming to an end and high-quality assets can no longer fall, people with a large amount of cash can enter the market at the bottom. That is the moment that truly changes their fate.
I don’t know how many people can rely on this crisis to replace the former rich and become the world’s new rich. "
After He Chaoling was silent for a moment, she asked slightly worriedly: "I feel that housing prices in Hong Kong City have also risen a bit outrageously in recent years, including in the mainland.
But if we don’t have MBS, CDOs, or financial derivatives like CDS, will there be no financial crisis? "
Chen Mo smiled.
He poured He Chaoling a glass of wine and motioned for her to sit in the swimming pool.
"You need to understand the nature of these financial derivatives. These things are actually equivalent to the iron ropes used by Cao Cao to splice his warships together in the Battle of Chibi. They are not the core of the crisis, they are just channels to transmit and amplify the crisis. "
“The core of a crisis is always debt.
The subprime mortgage crisis has burdened residents and financial institutions with excessive debt.
Wall Street swindlers have used financial products to spread debt risks around the world.
But now, it is just showing as a rebound in the financial industry, and the time for its real power has not yet arrived! "
Chen Mo said with a smile.
"Isn't it here yet? I feel that this crisis is already very serious." He Chaoling said in horror.
The fifth largest investment bank is on the verge of bankruptcy, house prices have dropped by 30% in two months, countless people have cut off their loans, and countless properties have been taken away by banks...
In this way, the crisis has not really erupted yet?
God!
When the loan crisis broke out... wasn't it almost like the end of the world?
"Bells and others are the fifth-ranked investment bank. Let me ask you, who is the number one investment bank?" Chen Mo asked.
"It's Lehman Brothers." He Chaoling responded, holding the wine in her hand, but her eyes couldn't leave Chen Mo for a moment.
Those eyes were almost wired.
The moments when a man shows his wisdom are really charming.
“The Bales moment has arrived, can the Lehman moment be far behind?
If Lehman Brothers can be busted, what about other investment banks?
Investment banks can go bankrupt, but what about commercial banks?
When banks can go bankrupt and depositors' deposits cannot be guaranteed, is there anything else that can be trusted? "
"You have studied economics, so you should know the importance of "liquidity", right?
Let me give you an analogy: I went to a village, paid a 100 yuan deposit at the hotel and went upstairs to see the guest room.
The hotel owner took my 100 yuan and went to the hotel to pay the 100 yuan he owed for the meal.
The restaurant owner took the 100 yuan and went to the butcher shop to pay for the meat on credit.
The butcher shop owner took the 100 yuan to pay the farm to buy the livestock.
After the farm owner took the money, he went to the hotel to pay the credit for booking a room with the beautiful woman.
At this time, I went downstairs because I didn't have a satisfactory room. I asked for the hotel's 100 yuan deposit and left.
In this story, the money has not increased by a dime, but the accounts of all people in all circles have been evened out. Everyone can continue to credit each other in the future and continue to maintain the development of this small economic circle.
And this is "liquidity"!
"
“Once the credit system collapses, people who hold cash will no longer trust anyone, liquidity will completely disappear, companies will not be able to borrow money, purchase goods, and trade, and ordinary people’s normal borrowing will be stagnant, they will not be able to borrow money to buy houses, and they will not dare to manage finances. Credit , can support the economy, or it can destroy the economy.”
"So, I can answer your question with certainty. Even if there are no subprime mortgages, no CDOs, and no CDSs, as long as the credit system fails, what is supposed to come will still come."
After Chen Mo finished speaking, he raised his head and drank the wine in one gulp.
"Then... what if we "lock in liquidity and maintain housing prices"? Can the crisis be solved or prevented? "
He Chaoling asked.
Chen Mo smiled: "Have you read too much what Paulson's group of experts say recently? Why do you still believe such words?"
“Highly leveraged assets, without “liquidity”, basically live or die in an instant.
A house without liquidity will be like a bloodthirsty tumor, sucking up cash flow.
The high returns of real estate companies are derived from high leverage, high liquidity, and high turnover. Without "liquidity", real estate companies will owe more and more debts, leaving behind a large number of unfinished buildings, all of which owe a lot of debt and go bankrupt. . "
After hearing this, He Chaoling felt as if she was enlightened. She held up the glass of wine and fell into a state of thinking for a long time. Even if Chen Mo went back to rest, she didn't notice...
