Chapter 800 Euro recovery

  The participants in this mysterious meeting were all heads of state in the Eurozone, including the Chancellor of Germany, the President of France, the Prime Minister of the United Kingdom, the Prime Minister of Spain, and the President of the Council of the European Union, as well as their finance ministers and central bank governors.

   That undeniably strong voice came from the female Chancellor of Germany. After getting involved in the Greek rescue and the European rescue mechanism, the voices of Germany refusing to rescue and withdrawing from the euro zone sounded one after another. She and her political party are facing tremendous pressure, which makes Merkel more determined to rescue Greece.

   There was no turning back from the beginning, and the only way to save the lost popular support was through the successful rescue of Greece. This is why the female prime minister deliberately showed a strong posture in this meeting.

   Leaders of other countries are naturally happy to see the gesture shown by the German Chancellor. Because Germany is the largest economy in the euro zone, many countries, including France, were very dissatisfied with their previous hesitation on the European rescue mechanism, and the French even made harsh words. But now everything is different, and the leaders are more than happy to cooperate with Germany again.

  As soon as the female prime minister came up, she targeted the hedge funds currently making waves in the market. After doing a little tricks, she figured out the list of some hedge funds. It is conceivable that the next step is the investigation of the European branches of these hedge funds by European regulators.

  Currently, high-level European leaders are very clear that this is a financial war led by the United States. But the problem is that this kind of thing can only be known to the heart, but can't be said, because they have also launched similar actions against the United States or other places in private, and both sides must tacitly maintain a superficial peaceful attitude. It is to maintain its own image, and it also includes the stability of the world.

   Moreover, when the European debt crisis was at its worst, the United States made a timely statement to disregard its relationship, which made the European side suffer even more.

  Although it is impossible to target the United States, the European side will not be merciless if it wants to deal with the thugs of the US government. The actions against the rating agencies and investment banks speak for themselves, now they are going to target the hedge funds, these vulture-like dudes.

  However, one unreasonable thing is that when the European leaders were discussing, all they mentioned were hedge funds from the United States, and none of the hedge funds registered in Europe were on the list.

   It is obviously impossible to say that European hedge funds have not participated in the debt crisis. You must know that European hedge funds are comparable to the United States in terms of number and size. But the European thinking is that even if there is a certain level of unrest, wealth will only be transferred within Europe. The participation of the Americans transferred the wealth belonging to the whole of Europe to the other side of the ocean, which made them unbearable.

   If Americans know this kind of thinking, I am afraid they will be wronged. But the reality is so unfair, they can only hold their noses and bear it.

  The specifications of the meeting were very high, the resolutions formed were without any room for negotiation, and the speed of implementation was beyond imagination, so that before the whole world could react, the Hungarian government issued a statement of "refuting the rumors".

On June 5, just one day after the Prime Minister’s spokesman declared that Hungary would not rule out falling into a debt crisis, Hungarian State Secretary Varga held an emergency press conference, saying that this year’s fiscal deficit could be controlled at 3% of GDP. .8%. Vargao said that the previous government did cover up part of the truth, but the new government will announce measures to stabilize the country's finances on Monday. Vogel called the crisis comments from his colleagues an "unfortunate event."

At the same time, the Central Bank of Hungary also issued a statement with similar content: Hungary’s public debt accounted for 78% of GDP in 2009, only slightly higher than the average of 74% of EU countries, and Hungary’s fiscal deficit in 2010 accounted for 78%. The proportion of GDP is expected to be around 4.5%, far better than that of Greece.

The European Union also issued a statement echoing them. The European Commissioner responsible for economic and monetary affairs Rehn said that Hungary has made significant progress in stabilizing the country's finances in the past few years. exaggerated.

At the same time as the official statement, voices from the market also sounded. Deutsche Macro Analysis reported that the new Hungarian government is about to announce a budget report and a new economic development plan this week, and it is expected that the fiscal and taxation system will be in-depth. The above rhetoric may be setting the stage for the structural reforms of the country and the possibility of failing to deliver on the tax cuts promised during the election campaign.

  HSBC Group also stated that Hungary is far from being second to Greece, and that the country's new government has vilified the current situation for political purposes. Although Hungary's real economic outlook is weak, the country is not a member of the Eurozone and its market influence is very limited.

In addition, there is another voice that has emerged. The new Hungarian government’s behavior compared to Greece’s paves the way for the introduction of fiscal austerity policies, but also has an obvious “crying poor” nature. The country may be ready to apply again. International Financial Aid. Amid the global economic crisis, Hungary became the first Central and Eastern European country to apply for international aid after falling into recession in the fourth quarter of 2008. In order to avoid default, Hungary received 20 billion euros (24 billion U.S. dollars) in loans from the International Monetary Fund (IMF), the European Union and the World Bank in October 2008, but it failed to obtain standby project financing in subsequent aid assessments .

  Many voices are mixed together, but there is only one central idea: Hungary will not be the next Greece, so don’t panic.

   Then on Sunday, June 6, a heavyweight news broke out from the IMF, which directly shifted the focus of the market to the past.

  The International Monetary Fund issued a forecast on this day, declaring that by 2012, the national debt of the United States will exceed its gross domestic product. The U.S. Treasury Department released data on the 2nd of this month, showing that the U.S. national debt exceeded 13 trillion U.S. dollars on the 1st, a record high, equivalent to nearly 90% of GDP.

This news tells the world almost nakedly, don’t keep your eyes on Europe. In fact, the United States, the engine of the global economy, also has a serious debt crisis. Once their economic growth rate slows down, they will also face a serious debt crisis. .

   Strictly speaking, this news is not supported by strict logic, because the United States can pay through the issuance of banknotes by the Federal Reserve. This is a strict difference between them and Europe, that is, they have an independent monetary policy. However, once there is panic in the market, it cannot be explained rationally. As soon as the market opened on June 7, the US dollar fell considerably.

Affected by these news, the euro, which was still falling, quickly narrowed its decline. The euro, which had fallen to 1.1876, suddenly had many buyers. Before the end of the day, the euro not only successfully broke through the 1.1900 level The psychological barrier, and once rose to the level of 1.1991, it was only a little bit able to break through the psychological barrier of 1.2000.

In the next two weeks, Europe's performance was impressive. It took only two trading days to successfully break through the 1.2000 mark on June 10, and then the momentum continued unabated, breaking through the 1.2100 mark again. It stopped at the 1.2125 level, up 1.15% for the day.

  Although there was a slight drop on the 11th, profit taking was at the time. Immediately afterwards, the euro rose again by 0.84% ​​on June 14. Following the rising momentum, the number of bearish options on the euro in the OTC market is rapidly decreasing, while the price and quantity of bullish options are rapidly increasing.

  Everything is going in a good direction.

   And on June 30, Europe once again released a large satellite.

   At this time a year ago, the European Central Bank provided a total of 442 billion euros to European banks with a one-year loan at an interest rate of 1%. At this point, European banks need to repay their loans to the ECB.

Based on concerns about liquidity, the market is very worried about the default of European banks, and at the same time, the capital market will fall due to the reduction of liquidity, because according to estimates, once the funds are withdrawn, there will be at least 100 billion euros in the European banking industry. left and right funding gaps. Because the European Central Bank made it clear that it would not extend the loan, this news caused the euro to plummet on June 29, the 1.22 mark was broken, and the interbank offered rate soared.

   But subsequent developments proved that this was a successful fooling of the market by Europe.

   Just on June 30, the European Central Bank convened 171 banks and sold them a total of 131.9 billion euros in three-month loans by way of tender. Although the scale is lower than the market's expectations, it has successfully filled the loopholes in the market.

Affected by this news, the euro began to soar after the second opening, so fast that those short-selling institutions had no time to react. In the end, the euro rose by 287 basis points all day, and the increase reached an astonishing 2.35 %. Sweeping away the decline of the previous three days, and sending a large number of institutions into the ranks of liquidation.

  The trading leverage in the foreign exchange market is often dozens of times or hundreds of times, because the rise and fall of foreign exchange is very small every day. In this case, if you want to make a profit, you can only increase the amount of funds in the form of leverage. This kind of advantage is that if you gamble in the right direction, you can obtain huge profits in the short term. The disadvantage is that after betting in the wrong direction, you will lose everything soon.

  Many institutions’ bearish futures and options on the euro exploded on this day, and their positions were ruthlessly liquidated. At the same time, shorting in bank stocks and capital markets also suffered heavy losses, and even some small funds were delisted for this reason.

"terrible!"

  After the market closed, Zhong Shi and others held another conference call to discuss today's market conditions.

Ackerman was the first to say with lingering fears, "Who knew that the European Central Bank would take such a measure? It seems that before this, they said that they would not extend the extension to lead these guys into the ditch. It increased by more than 2% in one day. It’s about putting people to death!”

  If he hadn’t listened to Zhong Shi’s opinion, and according to Ackerman’s character, he would definitely have invested in short selling, then he would have become one of the losers in the market now.

   "This is equivalent to a pressure test on their banking industry. As a result, everyone has seen it, and they still intervene very forcefully. At least so far, I can't see the possibility that the euro may fall."

   Facing the emotions of several other people, Zhong Shi just smiled lightly and said disapprovingly, "At least for a period of time, the euro will continue to rise."

   "But here comes our trouble!"

Delio's face was as deep as water, but it was a pity that other people couldn't see it, so he heard him say in a dignified voice, "I have encountered trouble in my London office. A few days ago, some employees reported that they were being watched by the British financial regulator. up."

   "How does it appear to be a British regulator?"

  Hearing this, everyone else was taken aback, including Zhong Shi, and Paulson asked quickly, "Is it one person or a group of people?"

   "The specifics are not clear."

Del Rio said worriedly, "They have a source saying that law enforcement agencies and regulators in the UK are planning a big operation. It is not clear what the specific content is, but what is clear is that the target will be hedge funds. I think they should be eyeing Bridgewater."

   "While no action has been taken yet, who knows what will happen tomorrow?"

  Dairio's words were full of bitterness and helplessness.

   Thanks to the book friends for writing casually, not very fat sheep, fat devil, light fish, kalm god, flying elf, Mr. Han voted monthly! Thanks to Pumpkin 62 for the reward! I'm very sorry everyone, I was sorting out my thoughts yesterday, and I haven't written it until very late... After persisting for a while, I started to feel that writing is very difficult. I hope everyone can understand the difficulty of the author's code words. But seeing so much support from everyone, no matter how hard it is, you have to grit your teeth and persist, otherwise you will have no face to ask for votes at the end of the month... Thank you again for your unwavering support, and I hope that book friends who still have votes can continue to actively support, Thank you so much~

  

  

  (end of this chapter)