Chapter 2273 The inflation rate has been raised by him!
The foundation can only use the tactics of "unplugging the network cable" and "repenting" once in a short period of time.
If in the past two years, similar transactions with sky-high amounts are "unplugged" in the financial market, then the hegemonic country's credibility will be completely destroyed.
Global capital will flee in panic and no longer trust the hegemonic financial market.
Therefore, Chen Mo is not afraid that the foundation will dare to use such dirty tricks again and again.
In addition, according to the memory of the last life, the leverage ratio of companies such as Bells is 45 times, while the number one investment bank Lehman Brothers is 67 times, and Freddie Mac and Fannie Mae, two companies with official backgrounds, are 108 times. Times! ! !
If Bales and other moments are the prologue to the outbreak of the subprime mortgage crisis, then the Lehman moment is the mid-term period when the subprime mortgage crisis breaks out in full force, and the jump of Fannie and Freddie is the moment when the subprime mortgage crisis reaches its peak and begins to enter its later stages.
Therefore, after fully closing the position, He Chaoling asked Chen Mo:
"Boss, will there be such a good opportunity to attack later?"
Chen Mo responded with a smile: "Where is this? Tens of trillions cannot shake the foundation and the hegemonic country.
This battle has just concluded its warm-up match. "
Immediately afterwards, Chen Mo immediately issued an order:
"Go ahead and order all the financial products related to the housing market that can be shorted, such as subprime mortgage bonds, ABX index, CDO, synthetic CDO, etc., to purchase CDS on a large scale!"
“It’s time to carry out the short selling to the end!”
This move is equivalent to Chen Mo ambushing all the chips before the Lehman moment arrives.
Sharks that smell blood are very scary.
Global capital, even though it clearly knows that the opponent it faces is a foundation and a hegemonic country.
But they still flocked to join the Sky God camp!
This also resulted in the abx index falling to 60% in just two weeks.
Anxiety spreads across financial markets.
A bigger avalanche is coming.
When house prices rise, subprime mortgage customers, with the help of intermediaries, refinance their original houses to obtain new loans for consumption and to buy a house again.
Once house prices fall, the loan obtained through this refinancing will no longer be able to repay the previous mortgage loan.
And interest rates have also risen a lot because of interest rate hikes.
The original positive feedback turned into negative feedback.
More and more people are joining the trend of selling their properties.
When the sell-off swept through every state in the country like a tide, a vicious cycle appeared in the property market!
The lower the price, the less people will buy it, and the lower the price, the more people will cut off their loans!
Subprime loan bonds are rapidly losing value!
The prices of MBS and CDO have been jumping up and down, while the prices of various CDs have been skyrocketing!
As the housing market deteriorates, ratings agencies can no longer sit still.
News of the three major rating agencies taking money to make fraud is flying all over the place.
The most important thing is that even idiots now know that subprime loan bonds are the most junk bonds. Under such circumstances, if these three major rating agencies dare to continue to rate subprime bonds at 3a, it is blatant. Tell everyone they are shameless and their ratings cannot be trusted.
Unable to withstand the pressure, the three major rating agencies applied to Solomon to correctly re-rate the financial market to ensure its credibility.
After Hannibal learned the news, he immediately objected: "They must not be allowed to lower the rating! No one has bought the subprime mortgage bonds. If they lower the rating again, won't there be no more buyers?"
Solomon said helplessly: "Hannibal, I told you, if you don't understand financial knowledge, just don't interrupt, okay?"
Hannibal was dissatisfied: "Am I wrong? No one will buy 3A-rated bonds. If you change them to D-rated bonds, they will buy them?"
Solomon: “If the three major rating agencies do not change their ratings and their credibility deteriorates, no one will buy any bonds rated by them.
However, if they are willing to re-rate according to the real market and restore their credibility, at least real high-quality bonds will still be purchased by investors and some liquidity can be restored. understand? "
Hannibal looked like he suddenly understood.
Immediately afterwards, the three major rating agencies finally began to re-rate the financial market with the permission of the foundation.
S&P downgraded 623 mortgage bonds with a total value of 2142 billion U.S. dollars.
Subsequently, S&P downgraded the bond ratings of Lehman Brothers, Freddie Mac, and Fannie Mae.
Even though Fannie and Freddie used their official connections to warn rating agencies, S&P remained unmoved.
In this period, if the rating agencies give any more face, they will be the ones to go bankrupt!
Rating agencies adjusted bond ratings to real levels, and housing prices plummeted, finally making everyone realize that the housing market was inevitable!
People with funds all over the world started to customize or purchase CDS contracts like crazy!
The price of the CDs in Chen Mo's hand has skyrocketed again!
Some people who did not have enough financial strength to buy CDS in the subprime mortgage market began to use CDS to short-sell their houses. In order to get a compensation to hedge the risk after the house price falls.
This scene is quite ironic. I bought a house, but I have to short-change it to keep it.
Some renters began to use CDS to short-sell their landlords or neighbors' houses.
At this time, the market began a major reversal.
Investors who had previously speculated in real estate began to join the Kongshen camp, and the craze for buying MBS and CDOs was replaced by the craze for buying CDS!
The most ridiculous thing is...
There are actually two other companies (Freddie Mac and Fannie Mae) joining the purchase of CDs!
This is also something that cannot be done.
Because two-thirds of Fannie and Freddie's profits in the past two years came from the subprime loan market.
If he doesn't follow the trend and carry out short selling at this time, he may follow in the footsteps of Bells and others.
The subprime mortgage crisis broke out completely, and when it could no longer be controlled, it finally began to spread towards the real economy of the hegemonic country according to the script written by Chen Mo!
Chen Mo sits in the office every day and receives all good news:
"Boss, the unemployment rate in the hegemonic country has skyrocketed recently, and the prices of oil and food have skyrocketed simultaneously."
"Reporting to the boss, the consumption of the hegemony country has begun to plummet. Ordinary hegemony people have begun to tighten their belts and no longer dare to borrow money for consumption, even if the interest rate of the loan is only one or two percentage points."
"Boss, great news! The country's manufacturing, retail and employment data have weakened overall!"
"Hey, oil prices have soared in the past two days, and the overall inflation rate has soared to 8%, which is the largest increase in this year. At the same time, the mortgage default rate continues to rise, and major financial institutions continue to announce financial losses.
Wall Street, and even the entire financial world of the hegemonic country, are panicked!
Even the monetary policy of the dominant Federal Reserve is in a dilemma. It doesn’t know whether to save housing prices or inflation, haha! "
Chen Mo was also happy when he heard this piece of information.
Inflation rate, also known as price change rate, is an economic term used to reflect the rate of increase in the general price level within a certain period (usually one year). It measures the extent of inflation, the decrease in the purchasing power of money.
The level of inflation can affect many aspects of the economy and society. Typically, inflation rates can be broken down into several different categories based on how quickly prices are rising:
Creeping inflation: The annual price increase rate is within 1% to 3%.
Mild inflation: annual price increases range from 3% to 6%.
Serious inflation: Prices rise by 6% to 9% every year.
Rapid inflation: Prices rise by 10% to 50% every year.
Hyperinflation: A very high rate of inflation, usually leading to the collapse of the monetary system.
Chen Mo remembered that in the last life, even after the Bales moment came, the inflation rate of the overlord only rose to 4.4%.
And now, after some operations by Chen Mo, the inflation rate in the overlord country has soared to "severe inflation"! ! !
On the other side of the ocean, Feng Hongyang, who heard the news, couldn't help but admired: "Chen Mo's methods are simply incredible! What he can do on his own is what so many countries cannot do together. arrive!"
