Chapter 720 Montes Family
Xu Liang strode over and took the initiative to extend his right hand.
"Mr. Montes, it's an honor to meet you."
Holding his hand, he looked at the taller and stronger young man in front of him, with a hint of complexity in his eyes.
Although he had read dozens of information about this person, the feelings the real person brought to him far exceeded those cold information.
"Helen mentioned you many times in front of me, but you are better than what she said."
"Thank you."
Xu Liang was a little surprised that his tone was pretty good to her.
But it’s normal to think about it.
When asking for favors, normal people will choose to be polite first and then fight.
Of course, Montes and his son could not understand Mandarin, but they brought a translator with them before coming.
"Haha, I have found a lot of people for your matter."
After sitting down.
Seeing the revenue of Hanhua's funds booming and the money he originally invested multiplying several times, Powell also became proactive.
“Helen said she had a brother Reed who was very affectionate.”
He opened the door and returned to the living room.
"Well. You would never expect the person who blocked the acquisition this time."
"Who?"
Holding his hand, Reed Montes smiled. .
“You guys talk first, I’ll answer the phone.”
The Montes family won't let it go. "
"Bye. "
"Haha, that's good. I still have something to do, so I’ll hang up first. "
This result was really beyond his expectation.
"I also heard her say that she now has a husband who loves her very much. ”
After hanging up the phone, Xu Liang pondered for a moment.
Xu Liang, a world-class rich man, is the one truly worthy of his friendship.
“Thank you, I won’t be stingy when it comes time for you to take action.”
“Helen has always told me that her father is a respectable elder, but it’s a pity that I I'm too busy with work and haven't had time to visit Boston. I'm really sorry."
Looked at the caller ID.
"I understand, thank you Colin."
"Xu, Helen Montes is a famous 'red rose' in the upper class of the East Coast. I don't know how many rich and powerful people have fallen under her pomegranate skirt.
Xu Liang’s cell phone rang suddenly.
Dingling...
“What? ”
"Dear Colin, your efficiency is amazing."
"The Montes family."
Now you have plucked the rose.
“From your tone, there is a result?”
It’s just a little embarrassing.
A biological sister is nothing.
"It's okay. If you need help, just call me.
Under Xu Yongpei's greeting, the three of them sat down.
Subconsciously glanced at the living room
Be polite now, but not necessarily next time.
The Montes family is not yet able to cover the sky with one hand. "
Xu Liang smiled and nodded, turning his eyes to the young man next to him.
"Everyone, please stop standing. Sit down and say, everyone, sit down. "
So the two sides can still talk.
"It doesn't matter, we will still have a lot of time to communicate in the future. ”
After that, he quickly walked out of the door.
"Mom and Dad, it's getting late. You go to the kitchen and prepare a table of Chinese food to entertain the guests."
"Okay. It's rare that my in-laws are here, so I can show off my skills. "
Wang Lingxiang stood up as he spoke.
I pulled Xu Yongpei by the way.
After saying a few polite words, the latter followed his wife to the kitchen.
After they left.
"Mr. Montes, I have some top-notch tea hidden here. Let's go to the reception room and try it?"
"Okay."
Montes and his son He agreed and followed Xu Liang to the reception room at the end of the first floor.
Looking at their backs, Xu Yongpei whispered.
“I think Helen’s father doesn’t look too good. Do you think we’ll start a fight soon?”
“Look at our son’s physique, he’ll get an advantage in a fight. Besides, Yes, I think Helen’s father has a good attitude.
Okay, stop thinking about it and help me think about what to cook for lunch.”
——
After closing the door of the reception room, Xu Liang made tea and brought it over.
“Please taste it.”
Reed Montes picked it up and took a sip.
"It's true. But with your intelligence, you should have guessed that I'm not here just for tea today?"
"Of course.
Your knife is on my neck, how could I not know. "Xu Liang said calmly.
Reed smiled and said: "You are very well-informed. You know so quickly that I am behind DreamWorks Animation? ”
“My network is wider than you think. "I believe this." Hanhua Capital’s fund-raising reception last year gathered half of the upper class of the United States. Unless it was related to the national security of the United States, you would know any news if you wanted to know it. "
"So when you blocked the DreamWorks Animation merger, you didn't want to hide it from me? ”
"You are very smart. No wonder you have created such an amazing career at such a young age."
Xu Liang smiled lightly, "Mr. Montes, I am already here. Can you tell me your purpose?"
br>
“It’s very simple. Helen is the pride of the Montes family.
If you want to marry her, you must pay a certain price.”
“I wonder what the price is? ”
"It depends on what you are willing to give."
After Reed Montes smiled, he picked up the teacup on the table and drank.
"I remember that the top tea in China is called 'Dahongpao'. There are only three plants in Wuyi Mountain in China. The annual output is only a few taels, and the taste is unparalleled.
I spent a lot of money The price was only a few grams."
Looking at the old god, Reed Montes, who was making puns, Xu Liang smiled lightly.
"We Chinese people always give a dowry to our wives. Although Helen and I are not married, now that we have children, it is no different from getting married.
So I am also willing to give a dowry.
But I just don’t know how big the appetite of the Montes family is, whether they can eat my dowry.”
Reed Montes smiled.
“Xu, the Montes family has always had a good appetite.
It is well-known among all blue-blood nobles. "
Xu Liang nodded, "Does Mr. Montes know about subprime mortgages? ”
“Of course. "
"Hanhua now holds more than 100 billion US dollars in ABS bonds backed by real estate subprime loans, of which 80 billion US dollars are 3B-rated bonds.
Next, Hanhua plans to acquire an investment bank and develop a new type of bond based on subordinated debt - collateralized debenture obligations (CDO). ”
Real estate mortgage loans, after being packaged by banks and resold to investment institutions, become ABS in the securities market, that is, asset-backed securities.
ABS securities are repackaged and become collateralized debt obligations (CDOs).
In the current U.S. securities market, there are naturally CDO products, but there are no CDO products based on mortgages.
“The main purpose of this CDO product is to sell the 3B-rated bonds held by Hanhua at book value.”
As soon as this statement came out, Reed Monte Si's face suddenly changed.
Chris Montes on the side even exclaimed.
“This is impossible!”
Xu Liang smiled lightly, “Nothing is impossible.
The asset pool of a mortgage subprime debt product includes 1,000 loans.
We can reclassify the loans in a 3A-rated asset package, such as 800 3A-rated loans and 200 3B-rated loans.
Then we will take this reintegrated asset package to the rating agency for re-rating.
I am 100% sure that this asset package is still rated AAA.
The reason is simple. In the past nearly a century in the United States, the default rate in the real estate industry has never exceeded 6%.
So, even if all 200 3B-rated loans in the entire asset pool suffer losses, the remaining 3A-rated loans can still cover the losses and allow investors to make considerable profits. ”
Hearing this, Chris Montes’ expression instantly became excited.
Although he is not engaged in the financial industry, he is also very clear about the difference between 3B-rated bonds and 3A-rated bonds. If everything goes as Xu Liang said, the profit will be dozens of times higher if it is sold.
Reed Montes was calmer than his son, after taking a deep breath.
“Why didn’t those investment banks do such a lucrative thing?
I don’t believe Wall Street didn’t discover this loophole.”
“Of course Wall Street would have discovered it, but now they haven’t. Just discovered it." Xu Liang smiled.
After all, credit default swap products for real estate subprime loans have not yet appeared, let alone secured debt obligations.
Now Wall Street is enjoying a surge in subprime debt.
When the dividends from subprime loans are almost gone, they start to engage in more exciting financial innovations.
For example, Credit Default Swaps (CDS) and Collateralized Debentures (CDOs).
Later, the famous ‘composite secured debentures’ were developed.
The market is expanding step by step, and the showy operations also start little by little.
Now Xu Liang just took the first step.
Reed was silent for a moment.
“Can you guarantee a 3A rating? Moody’s and Standard & Poor’s are not fools.”
Xu Liang smiled and said: “There is a saying circulating on Wall Street: Find a job on Wall Street. People who don't have jobs go work for Moody.
Although it was just a joke.
But it can be seen that although Moody's and Standard & Poor's are world-class rating agencies, they are not omniscient gods.
In fact, there are big loopholes in the rating models used by Moody's and Standard & Poor's.
The simplest example: FICO score. ”
The FICO score was invented by FICO in the 1950s and is used to measure the credit worthiness of individual borrowers.
The highest FICO score is 850, the lowest is 300, and the median score in the United States is 723.
“Both Moody’s and Standard & Poor’s use FICO scores to measure a user’s credit rating.
What’s stupid is that they only care about the score and never consider the borrower’s true income.
But FICO scores can be manipulated
A potential borrower can improve his or her credit score by first withdrawing cash from a credit card and then paying it back immediately. .
This fills the FICO score with water.
Many borrowers with high scores may just be Mexican pickers working on Texas farms.
But what is even more ridiculous than the FICO score is its abuse by Moody’s and Standard & Poor’s.
Based on our investigation.
Rating agencies ask subprime loan packagers to provide, not the FICO scores of all borrowers, but the average FICO score of the loan pool.
In other words, as long as the loan pool meets the score of 615, it will be rated as a 3A-rated bond by Moody's and Standard & Poor's.
(End of this chapter)