Chapter 721 Big Hero
On September 12, the Italian lira, which has always been a soft currency in the European Monetary System, was in crisis. The exchange rate fell all the way, falling to the maximum lower limit of the lira-to-mark exchange rate in the European Monetary System's exchange rate mechanism.
Although the Italian government raised the bank discount rate twice from 12% to 15% on the first day and the 9th, and also sold marks and francs to the foreign exchange market, it failed to ease the situation.
On September 13, the Italian government had to announce the devaluation of the lira, lowering its parity by 3.5%, while the other ten currencies of the European Monetary System will appreciate by 3.5%. This is the first time since January 1987 The first adjustment of the European Monetary System parities.
At this time, the German government still did not want to make sacrifices. In the end, it was forced to make minor concessions due to the crazy clamor of the member states of the European Monetary System, and officially announced on September 14 that it would discount the The rate dropped by half a percentage point, from 8.75% to 8.25%.
This is Germany's first interest rate cut in five years, and it is also Germany's huge contribution to the stability of the European currency, because unlike its pig teammates, Germany's economy has been growing continuously and steadily.
It can be said that if it were not for a group of pig teammates who play financial games, Germany's economy would continue to improve, and the discount rate needs to be increased rather than lowered.
This real "righteous act" is of course highly appreciated by the United States, Britain and France, but the timing is too late and the action is too small.
On the night when Germany announced an interest rate cut, Jack Lee called Zhou Zhi and shouted excitedly: "Elbow! It's stable this time, one week! In just one week, we can earn what we spend our whole life on." Endless money!”
Sure enough, the next day, the international predators took this as a starting signal and opened their mouths.
The pound was frantically shorted, and the exchange rate began to fall. The ratio between the pound and the mark broke through three lines of defense in a row, reaching 2.78 marks per pound.
The plummeting pound caused the British government to panic. In the early morning of the 16th, it announced an increase in bank interest rates by 2 percentage points. A few hours later, it announced an increase of 3 percentage points, raising the interest rate from 10% to 15%. .
Raising interest rates twice a day is unique in the modern history of the United Kingdom. The purpose of the United Kingdom's abnormal move is to attract short-term foreign capital inflows, increase demand for pounds, and stabilize the exchange rate of pounds.
But the changes in the market are subtle, and such a move makes the short side extremely excited, because it is a strong signal that the British government cannot resist the siege.
Market confidence is completely shaken, the general trend is completely formed, and the trend of exchange rate changes will be difficult to curb.
In the two days of 15 and 16, central banks of various countries injected tens of billions of funds to support the pound, but to no avail.
On the 16th, the exchange rate between the pound and the mark dropped from 1 pound equal to 2.78 marks the day before to 1 pound equal to 2.64 marks. The exchange rate between the pound and the US dollar also fell to the lowest level of 1 pound equal to 1.738 US dollars.
The mechanisms are exhausted.
On the evening of the 16th, British Finance Minister Lamont announced that the UK would withdraw from the European Monetary System and lower the interest rate by 3 percentage points. On the morning of the 17th, he lowered the interest rate by 2 percentage points, restoring it to the original level of 10%.
After the Italian lira devalued on the 13th, only three days later, it was once again in crisis in the foreign exchange market. The ratio of the mark to the lira once again exceeded the lower limit of the readjusted exchange rate.
In order to save the lira from falling, the Italian government spent all its foreign exchange reserves worth 40 trillion lira, but to no avail, it had to announce that the lira would withdraw from the European monetary system and allow it to float freely. After a six-hour emergency meeting of European Community financial officials, they announced that they agreed to temporarily separate Britain and Italy from the European Monetary System.
Another currency, the Spanish Peeta, also announced a 5% devaluation.
From January 1987 to September 1992, in more than five years, the exchange rate of the European Monetary System was adjusted only once, and within three days from September 13 to 16, 1992 The second adjustment was carried out, which shows the seriousness of this European currency crisis.
On September 20, the Treaty of Maastokh was voted on. Its central idea is to establish a political entity similar to the United States of Europe between countries that still have great differences in culture and politics.
Not only do member states have to use the same currency, but they also have to pursue a common foreign and security policy.
The adoption of the Treaty of Maastokh finally calmed down the European currency crisis temporarily. The British pound, the Italian lira, the Finnish mark, and the French franc, which suffered from the disaster of pond fish, and the Spanish competition tower, Finally, we have reached a state of equilibrium after the sharp decline in depreciation.
The reason for the balance is, of course, that the short side converted their chips into profits, and the bloody feast is finally over.
The funds used to exchange these chips came from the huge sums of money that the central banks of ten countries had to invest in order to save the European economy and the national economy.
According to later statistics, on the 16th alone, the British government had to purchase 27 billion pounds to fight the sell-off, spending almost all of its foreign exchange reserves.
Zhou Zhi's capital was only a drizzle in this feast. He had tried his best, even using the maximum leverage, and only allowed himself and Jin'an Co., Ltd. to get 25 million US dollars each.
Zhou Zhi seriously suspected that Jack Li's Hongsheng Accounting Firm's income far exceeded his own, but he was helpless, after all, he only had so much capital.
In fact, Zhou Zhi also overestimated the income gained by Jack Lee, because most accounting firms in Hong Kong adopt a partnership system, and the funds that each person can use are limited. Jack Lee only had Zhou Zhi and An Xin Enron Foundation at the beginning. The entrusted funds are available for operation. After lobbying the big bosses for approval and obtaining operating capital, Zhou Zhi and the others have already earned tens of millions of dollars.
The entry plan was a little late, and I didn’t dare to operate according to the high leverage set by Zhou Zhi. I also missed the first wave of Finnish Mark and Italian Lira dividends, although the capital scale was much larger than Zhou Zhi and others. , but it is not exaggerated to the extent of thoughtful imagination.
But no matter what, this cooperation is also very pleasant. For Jack Lee, this battle has completely established his position in the family and the accounting firm. This means far more than the mere hundreds of millions of dollars gained. important.
"Cousin An Xin, will you tell you when she will arrive in Shenzhen?" Zhou Zhi was speechless as he listened to Jack Li's non-stop chatter on the phone, sharing his great achievements.
These operations are the result of discussions between the two of them. They know every step carefully. Now I repeat it again. Is international long distance very cheap?
"An Xin said she would come over during the National Day. Then I would accompany her for inspection." Jack Li's excitement during this period may also be due to this reason: "Didn't she say she wanted to open a factory in Shenzhen? Now the funds are That's enough."
"Yes, you are a great hero now," Zhou Zhi sneered.
(End of this chapter)