Chapter 537 The first loss in history (1)

   At the moment when the torrential rain fell, Prince Faisal also called the headquarters of Stanley and told them that the deal had been cancelled.

  John Mark, who has worked in Stanley for more than 25 years, started as a trainee at Stanley after graduating from Duke University, and gradually rose to the top of the management. Although he was forced to leave Stanley Company due to power struggles, his experience outside made his prestige even higher. In the end, in 2005, he returned to Stanley again, serving as the global chairman and CEO of Stanley.

  As a manager with a distinctive personality and a swift and decisive attitude, John Mark began to cut costs drastically after he took office, and at the same time encouraged more use of his own funds to participate in various transactions, especially the FICC business. Under his instructions, the early warning mechanism of the risk control department was relaxed, and traders began to enter some high-risk transactions, especially those that were more complicated and dangerous, and even some fields that Stanley was not very good at. Under this aggressive strategy, Stanley's net income has grown rapidly every quarter, and the income from the trading business has shown a rapid growth. In the quarterly financial report disclosed in November 2006, the trading income was 2.317 billion U.S. dollars, and by February 2007, this number had surged to 4.158 billion U.S. dollars. In the financial report disclosed in May, this figure reached a horrifying 4.838 billion U.S. dollars, becoming the second only to interest and dividends. The second largest source of income, far behind the income brought by investment banking.

Although in the quarterly report disclosed in August 2007, the income from the transaction was only US$1.381 billion, which showed a sharp decline, and was left behind by the US$1.659 billion brought by the investment banking business, but this is a bad market situation. However, the subprime housing mortgage crisis was not caused by the ability or strategy of traders. But even so, in this quarter, Stanley still recorded a net income of US$7.939 billion.

   But after the trading department took in as much as 30 billion US dollars in housing mortgage loans, all these exaggerated profits came to an abrupt end. Bonds with excellent ratings were able to maintain their corresponding prices, while the prices of those bonds with a greatly increased risk of default fell sharply and fell by almost half. In the entire investment portfolio, this part of the bond accounted for half of the share.

  John Mark knew about this when everything was already done. As the CEO, he is not very clear about every transaction made within the company, but he is aware of every loss, let alone this one, which can be called the biggest loss on Wall Street and even the entire financial world. trade.

   Fortunately, so far, there are still two full months before the release of the quarterly financial statements, which is enough for Stanley to process and digest this bad debt internally. So under the leadership of John Mark, Stanley's trading department launched a global trading network in an attempt to find a possible potential buyer.

During the sale process, Zhongshi’s Hong Kong consortium and Prince Faisal’s consortium came into the sight of Stanley’s transaction and sales department. They also contacted Stanley’s negotiating team. Finally, during the bargaining, the bond In the end it was a deal.

  Although an agreement has been reached with Prince Faisal's team, John Mark is still worried, because in this intentional contract, the other party can completely tear up the contract in the first payment period or the second payment period. At the beginning, he clearly knew that the other party reserved room, but because his side was eager to make a move, and the other party's offer was also the highest, so he could only hold his nose and bear it.

  Although this part of the bond has not been completely sold, John Mark finally let go of a part of his heart. Just a few days later, the Northern Rock Bank run on the other side of the ocean made his heart hang again. Naturally, this was not because of the close business relationship between Northern Rock Bank and Stanley, but because of the subprime housing mortgage crisis. It spread to the UK, although the scale and strength of its impact remains to be seen now.

  The sky darkened, and there were lightning and thunder in the distance. Not long after, the entire world was shrouded in a vast expanse of white water vapor, and only the light outside the window could be vaguely seen. John Mark let out a long sigh, looked away, and returned to the comfortable executive chair. There was a thick stack of documents piled up on his desk. In the documents, in addition to dealing with transaction authority matters, there were also complicated internal struggles.

  When something of this magnitude happens, someone has to take responsibility, even if the bonds are eventually sold. John Mark was thinking about how to use this opportunity to get rid of dissidents in the company. The first thing he wanted to clean up was co-president Zoe Crews, and the second was chief risk officer Tom Dorel. Among them, Cruise is an old minister left over from the previous term and must be cleaned up, while Tom Dorel is purely taking the blame for him, but this is not the time to show affection.

   "Hi, I'm John."

Just as John Mark was weighing it over and over again, the phone at hand rang. He put down his pen and picked up the phone. First, he showed his identity with a relaxed expression, but soon his whole face sank, because he heard It's a news that I absolutely don't want to hear at this time.

  Prince Faisal’s consortium broke the contract, and would rather risk hundreds of millions of dollars in deposits than unilaterally terminate the purchase contract. It was only three or four days before they reached an acquisition agreement. And the most annoying thing in the whole process was that Prince Feisal only gave a verbal notice, and he didn't even bother to issue official documents.

  Although it has been known for a long time that the Middle East consortium does not play cards according to common sense in business activities, it is the first time John Mark has seen them not paying attention to this level. After slowly putting down the phone, although he didn't act aggressively, the slight twitching of his face showed that he was extremely restless. Although he was psychologically prepared to a certain extent, John Mark still did not expect that the other party would backtrack so quickly, and he simply treated this business as a joke.

  John Mark knew the reason behind it. Without exception, it was the chain reaction caused by the run on Northern Rock Bank, which made the other party feel scared. It's just that for the current subprime housing mortgage market, John Mark can't guide or control it at all. In fact, not to mention him, even Greenspan dare not say that he can guide or control him.

   Thank you book friends, it wasn’t me who voted for the monthly ticket last night! The time is tight these days, and the number of words written is less, I hope everyone will forgive me, and I will write more after a while~

  

  

  (end of this chapter)