Chapter 377 Peregrine's self-help

  There is never a shortage of predictions in the market. Some predictions are based on basic economic principles and financial principles, and some predictions are likely to be thought of by some people. In any case, these guesses need a reasonable explanation, which becomes the "logic" that everyone will recognize.

For example, once various interest rates including the benchmark interest rate are raised, the market will unanimously believe that this is bad for the stock market, because no matter from the perspective of economics or finance, interest rates and investing in the stock market are financial products, and even It can be said to be homogeneous: in some respects, it reflects the price of capital. There is a competitive relationship between homogeneous products, so when the income of one is high, the price of the other will inevitably fall.

  Another explanation is that companies also need to use the banking system to circulate funds. When interest rates rise, it means that their costs increase, and cost increases mean that profits fall, which means that stock prices fall.

  These are generally recognized principles of economics and finance, which are fully recognized by all aspects of the market. Of course, in some policy market economy countries, these principles may not be easy to use. For example, state-owned enterprises occupy the largest share of a country's capital market. Worried about costs, these "golden rules" cannot form a corresponding role and expectation in the capital market of such a country.

Anyway, in addition to these explanations, there is another kind of "logic" in the market. Although this "logic" sounds far-fetched and sometimes even a little nonsensical, it is often this "logic" that affects the market. Stronger destructive power and greater lethality.

  For example, rumors that "Hong Kong's currency is likely to be attacked again and the linked exchange rate system may not be maintained" are widely circulated in the market, which has caused great damage to the Hang Seng Index during the day. The logic is that the currency markets in Southeast Asia are once again unstable, and the Indonesian rupiah has continued to plummet, indicating that international speculators have once again shifted their focus of speculation back to the South Asian market, and Hong Kong will be their next stop.

  In all fairness, this kind of logic is not without evidence support, but it is said that a market with foreign exchange reserves of nearly 100 billion U.S. dollars will be destroyed. This evidence and logic cannot convince the market at all, but this does not prevent this kind of rumor from being popular in the market.

   Soon, after entering the night, this rumor became a reality.

  As soon as the Hong Kong dollar opened in the London market, the exchange rate for the U.S. dollar appeared at 7.7350 Hong Kong dollars, which was 31 basis points lower than the closing price of 7.7319 in the previous trading day, which immediately made the market smell unusual.

   Soon, the trading volume of the Hong Kong dollar began to increase sharply, becoming the currency with the second largest trading volume in East Asia, second only to the trading of the Japanese yen. Due to the surge in trading volume, investors began to focus on the Hong Kong dollar. They were surprised to find that the number of Hong Kong dollars sold in the market was almost countless, and they immediately realized that an attack against the Hong Kong dollar had begun.

  In the past trading day, it is very unusual for the Hong Kong dollar to surge by 0.23%. The opening price could have been interpreted as a market correction, but the amount of this "recall" really made analysts disagree.

"They started?" Ren Yigang was in charge this time. He also heard the rumors in the market during the day, and the Chief Executive himself called to ask, which made him feel pressured, "What will happen this time? Do we need to raise the interest rate?" ?”

"I don't need it for the time being, so as not to cause more panic." Shen Niantao quickly replied while directing the traders, "It's not clear whether there are any international speculators behind, let's observe for a while before talking. Yesterday, I exerted too much force , It is likely to cause a slight correction in the market, if the correction is not very large, it can be considered as normal market behavior."

  Unfortunately, these are all Shen Niantao’s wishful thinking. Just when he thought it was a market correction, the exchange rate of the Hong Kong dollar began to fall suddenly. Soon the exchange rate fell by 50 basis points, and the Hong Kong dollar fell to 7.7400 all at once.

   "Such a large correction?" Ren Yigang couldn't sit still, he frowned and asked Shen Niantao, "Is this within your expectations? Why do I feel that this magnitude and speed are not normal?"

   "It's really abnormal!" Shen Niantao replied without turning his head, and then loudly instructed the traders, "Put 50 million US dollars into the market, and wait for the decline to slow down."

   Without needing any more instructions from him, the traders began to divide their work and give various trading orders.

  According to Shen Niantao's prediction, although this amount of money will not stop falling and rise, it can at least slow down the decline of the Hong Kong dollar. After all, this is 50 million US dollars, an astronomical foreign exchange transaction. What surprised him was that the 50 million US dollars was like throwing a stone on the lake, and it disappeared without a trace with just a little splash.

  The Hong Kong dollar continued to fall without slowing down. Less than two minutes after the 50 million US dollars were put into the market, the Hong Kong dollar fell to the price level of 7.7420.

   As a result, Shen Niantao couldn't sit still anymore, fine beads of sweat even oozed from his forehead, "Sell for $250 million, no matter the price, let's stabilize the downward momentum first."

This time he increased his chips by five times, thinking that the current decline of the Hong Kong dollar should be stopped, and with such a large amount of selling, a discerning person would know at a glance that it was the Hong Kong Monetary Authority. Selling Hong Kong dollars is not hitting the gun?

   It’s just that he was disappointed again this time. The entry of 250 million US dollars only lasted for half an hour, and then selling became the main force again, causing the exchange rate of the Hong Kong dollar to fall again.

However, the situation is slightly different. Now the market is no longer blindly selling, because the appearance of the previous amount made other market participants realize that the Hong Kong Monetary Authority has made a move, and some investment institutions began to try to buy Hong Kong dollars. , ready to fish in troubled waters.

  The selling party obviously anticipated this situation, and they increased their short-selling efforts just after the buying party's strength emerged. Originally, although there were a large number of sellers, the single sale amounted to hundreds of millions of Hong Kong dollars at most, but now there are several transactions with a single sale value of up to one billion Hong Kong dollars, and this news was immediately captured by the market .

   At this point in the transaction, even the slowest foreign exchange trading institution understands that this is a sale against the Hong Kong dollar.

   "Regardless of quantity, regardless of cost, stabilize the situation for me!" Naturally, Shen Niantao also caught this information, gritted his teeth, and ordered ruthlessly. Under such circumstances, if the Hong Kong Monetary Authority cannot face it forcefully, they will probably be the only Hong Kong dollar buyers left in the market. He is very aware of this psychological change.

  Ren Yigang didn't speak at the side, but his deeply furrowed brows and stern expression betrayed his true inner thoughts at this moment. But since Shen Niantao has taken full responsibility from the sidelines, it is natural for him not to take the lead.

  Although it started to exert its strength, the emergence of the HKMA did not reverse the situation immediately. The exchange rate of the Hong Kong dollar continued to fall, and the 7.7450 barrier was only held for a few minutes before it was announced that it had fallen. Soon, the Hong Kong dollar rushed to the price of 7.7470.

  However, here, regardless of the cost and quantity of buying, the HKMA successfully curbed the selling of national speculators, and the two sides began to trade frequently again. One wants more declines, and the other wants to stick to the current situation. The two sides launched a contest that lasted for more than an hour. The transaction volume once exceeded the 30 billion Hong Kong dollar mark per hour. In the end, it was an international speculator. The first side couldn't support it, and began to retreat gradually.

  Seeing that the opponent finally retreated, Shen Niantao had the time to let out a sigh of relief, and then entered the real market correction. But in order to prevent the opponent from making a comeback, he didn't dare to be careless at all, and still stared at the market trend intently. However, this time the international speculators did not reappear, and all aspects of the market began to turn for the better. With the support of the Hong Kong Monetary Authority, the Hong Kong dollar gradually rose, and finally stayed at the level of 1 US dollar to 7.7420 Hong Kong dollars at the close.

When the market closed, Shen Niantao wiped the sweat from his forehead, and said to Ren Yigang who was at the side with lingering fear: "Ren Sheng, it seems that we need to discuss the news of the comeback of international speculators, and it's time to show them some color. Otherwise, they will come back one or two times according to today's rate, maybe the Hong Kong dollar will really fall below 7.75."

  Ren Yigang nodded heavily, but said nothing.

  …

   "Finally repelled the attack of the international speculators, this time is very dangerous!"

  On this night, many people were paying attention to the trend of the Hong Kong dollar. When they saw that the Hong Kong dollar finally turned from falling to rising and finally stood at the position of 7.7420, most of them breathed a sigh of relief.

Ma Jiarui was also one of them. When he saw the final result, he also heaved a long sigh of relief. When he turned his head to look at Zhong Shi, he found that his boss didn't know when he started fighting. Hulu, obviously, Hong Kong's wonderful offensive and defensive battle did not attract his attention.

   "..."

   After shaking his head helplessly, Ma Jiarui took a blanket and gently covered Zhong Shi's body, then turned off the lights in the office, and tiptoed outside.

   "I'm afraid this is just the beginning." I don't know if it was a dream or subconsciously, Zhong Shi suddenly muttered, "Just wait and see, their attack should not be over yet."

  As soon as he walked to the door, Ma Jiarui's body froze after hearing these sleepy words, and when he turned his head again, Zhong Shi began to snore evenly again. Ma Jiarui bowed his head in thought for a moment, finally shook his head helplessly, and closed the door smoothly.

  …

   "It seems that the information from the headquarters is accurate!"

  In Larry Morris' room, an ocean phone was always on, and the person on the other end of the phone reported the movement of the Hong Kong dollar every few minutes, and naturally they heard all the twists and turns.

  Larry stood up, showing a resolute expression, and said without hesitation to the subordinates who were looking at each other: "Call Peregrine immediately and announce that we will cancel the loan contract of 60 million US dollars, immediately!"

   At four o'clock in the morning on January 9th, Peregrine was notified that Chicago First Group canceled its loan intention. Soon, this news reached the ears of the ZCI. Cleo Dante urgently convened a negotiating team to analyze the intentions of the United States. In the end, they came to the same conclusion as the Chicago First Group, that is, in the future For a period of time, there are serious financial risks in the Hong Kong market. Once this kind of risk occurs, the losses will definitely exceed the possible gains from their investment in Peregrine.

   At 5 am, ZCI notified Peregrine that it would cancel its plan to purchase preferred shares of Peregrine, and at the same time, it would no longer buy the Asian corporate bonds that Peregrine held, that is, the transaction was completely cancelled.

The news of ZCI's complete cancellation of cooperation also quickly spread to the ears of the Chicago First Group. With all the real funders leaving, they would naturally not buy the preferred shares of Peregrine, so they quickly The land also canceled the cooperation with Peregrine's preferred stock purchase plan.

Before the sun rose, Peregrine's plan to introduce strategic investors announced two months ago had completely failed. The worst thing was that today was the day when Peregrine held a general meeting of shareholders. There is only one day when principal and interest payments are made to certain bond investors.

  If it was said that Peregrine was in crisis because of cash flow problems, then what is in front of Peregrine now is time and cash. Now Peregrine is really at the critical point of life and death.

  Nian Botao and Du Kanghui were ashamed when they received the news. They sat for a long time without saying a word.

   It is simply impossible for them to find investors around the world in one day. And tomorrow, they have to pay principal and interest to bond investors. If they fail to perform the contract in time, they will default. delisted.

   Foreign aid is hopeless, so we can only save ourselves. After sitting for a while, finally around 8:00 in the morning, Nian Botao and Du Kanghui called the managers of various departments to announce the fact that the cooperation had been cancelled, and at the same time hope that everyone can work together to actively save themselves.

Finally, before the general meeting of shareholders at ten o'clock, this group of elites finally thought of a way to spin off the investment banking department and sales department of Peregrine's core department into its holding company Guangshenghang, and other departments followed the head office. Going into bankruptcy together, including the fixed income division that led to it all.

   Next, all the people started to rush to make documents, hoping to send them to the Financial Management Bureau for approval as soon as possible.

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  (end of this chapter)