My Fintech Empire

The time comes to mid-September.

Living quietly in the villa, Tian Jiayi found Fang Hong when he came back from the company, and also brought back a piece of information: "In the past few days, I have compiled the estimated data on the flow of international hot money in the country in the past 20 years, and the main weights of the estimation caliber. It is materials from the Administration of Foreign Exchange and the Bureau of Statistics, combined with our internal data integration.”

Putting the compiled materials in front of Fang Hong, Tian Jiayi added: "According to statistical data, since the reform of the foreign exchange management system in 1994, the flow of international hot money in the mainland has shown obvious cyclical characteristics. In 1994 In the eight years to 2002, the mainland's economic growth has been relatively stable, with an average GDP growth rate of 9 percentage points, and was affected by the Asian financial crisis, with a total net outflow of hot money of US$400 billion."

"In the seven years from 2003 to 2010, after joining the WTO, the domestic economy generally showed rapid development momentum. The average GDP growth rate at this stage was 11%. At the same time, the expectation of unilateral appreciation of the RMB was strengthened, and the total net inflow of hot money About $300 billion."

Tian Jiayi paused for a moment to collect his thoughts and continued: "From 1994 to 2010, in the long term of about fifteen years, the net outflow of hot money in the early period has roughly offset the net inflow of hot money in recent years. The overall net outflow is about 100 billion U.S. dollars, accounting for 3.5% of the increase in foreign exchange reserves during the same period, but this is the data after excluding the huge profits of Qunxing Capital from cutting off Wall Street last year."

Fang Hong picked up the materials and browsed them silently.

The so-called hot money refers to international hot money and short-term speculative funds, which are an important source of global financial turmoil and even financial crises.

These hot money are wandering around the world, flowing wherever there is profit. They push up asset bubbles in countries around the world, grab huge profits, then ruthlessly strangle them, and then move on to the next target.

After the asset bubble of the previous target bursts and is seriously oversold, they will turn back and buy some core high-quality assets that followed the plunge at extremely low prices, thereby achieving repeated harvesting, eating up the short positions and taking the long positions.

And this also has an amazing resonance effect with the US dollar tidal circulation cycle.

This kind of hot money is not just as simple as entering the stock market. It can be said to be all-pervasive in the foreign exchange market, bond market, property market, and entities. It can be said that wherever the wind blows and water penetrates, hot money is like wind and water.

International speculators cannot blatantly attack places like large Eastern countries that have implemented foreign exchange controls and have not had a high level of financial market development. However, the nature of capital is profit-seeking. As long as there is an opportunity to make huge profits, they will not speak lightly. give up.

Fang Hong asked while browsing the materials: "As of the first half of this year, what is the approximate scale of hot money inflows?"

Tian Jiayi replied: "The specific estimate is unknown, but one thing is certain. Hot money is flowing in rapidly during this period, and the scale is very alarming. Overall, it will not be less than 1.5 trillion US dollars."

Fang Hong said to himself: "1.5 trillion..."

There are various channels for the inflow of hot money. The first one is false trade. International hot money colludes with the mainland’s procurement agencies to reach false agreements to import goods from the mainland. However, they do not actually import goods, or they only import some extremely valuable goods. Low-priced goods are those that are thrown directly into the sea after going to the sea. At the same time, they can also falsely report prices that are much higher than the actual value of the goods, and then transfer funds to the country.

Then there is false investment or false credit. Foreign speculators set up companies in the mainland and inject funds into the company. However, these funds are not used for actual production, but for speculation in various assets. False credit is similar.

Then there are underground banks. International investors can pay US dollars in Hong Kong and then withdraw RMB in the mainland. They can also pay RMB in the mainland and exchange them for US dollars in HK. During this process, although no actual cross-border flow of funds occurred, the money that wanted to come in came in and the money that wanted to go out also went out.

In addition, there is currency smuggling. International speculators use the entry of people or goods to bring US dollars into the mainland, or directly transport US dollars into the mainland through smuggling. This method is relatively risky, but as long as the benefits are sufficient Although there are still people who dare to take risks.

There are also some international capitals that will use banks in Hong Kong to allow 20,000 Hong Kong dollars to be exchanged for RMB every day, remit 80,000 RMB to mainland banks, and the mainland's annual exchange quota of 50,000 US dollars per person, in order to break up the whole into parts. Entry and exit.

These channels or means are also some common ways for enthusiasm to enter and exit the country. It can be said that, especially now, the flow of enthusiasm has reached a pervasive and unscrupulous level.

Because the U.S. dollar interest rate hike trend has been blowing for three quarters, the U.S. dollar tidal circulation harvesting and entering the interest rate hike cycle are getting closer and closer, and there is not much time left for them, so they are also making plans quickly.

At the end, Fang Hong put down the materials in his hand and said to himself: "Objectively speaking, with the rapid growth in the past thirty years, there are huge investment opportunities in the country. It is reasonable for foreign capital to pour in and get returns, and it is also reasonable to leave with reasonable profit reports. No problem. However, if they want to engage in capital plunder, I can't tolerate it. I can't ignore it. Even if I take a step back, the meat will rot in my own pot and stay in my own land. Even if it rots, it will be fine. Fertilize your own land.”

The past three decades have experienced rapid growth, which is in sharp contrast to developed countries. There is the possibility of substantial growth in the domestic property market and stock market.

Under such circumstances, if the U.S. dollars are exchanged for RMB and people speculate in real estate and stocks, they are likely to make huge profits. If the RMB appreciates relative to the U.S. dollar later, they can make a huge profit again and obtain double gains in asset price appreciation and exchange rate. .

In the years since 2003, the average annual return on house prices in several major first-tier cities in the Mainland has reached 20% to 50%, while in North America during the same period it was only about 6%, and in the small book next door, it was only about 4%.

In the past few years, the exchange rate of RMB against the US dollar was 8:1, which meant that 1 US dollar could be exchanged for 8 yuan in RMB. Assume that a foreign-funded institution exchanges 1 billion U.S. dollars for 8 billion RMB to invest in real estate. Suppose that housing prices subsequently rise sharply and double this year. At this time, the foreign investor sells the house to cash out 16 billion, and plans to exchange it back for U.S. dollars.

According to the exchange rate of 8 to 1 at the time of entry, 16 billion yuan can only be exchanged for 2 billion U.S. dollars. However, this year the exchange rate of RMB against the U.S. dollar once appreciated to 6 to 1. According to this exchange rate, 16 billion yuan can be exchanged for 2.66 billion U.S. dollars, which is equivalent to giving more 660 million US dollars.

Then the actual profit earned by this foreign-funded institution is not only the doubling of the house price, but also the profit from the exchange difference. The actual return rate is not +100%, but more than +160%.

Driven by international capital, comprador colonialists, and various forces, the stock market and property market have surged. International capital has also made huge profits and passed on risks to the general public.

When the real estate and stock markets turned cold, they entered other markets, such as the private lending market, so-called Internet finance such as "Pitupip", or simply stayed in financial institutions to earn stable returns of more than 10%.

From 2003 to this year, the mainland's economy has grown rapidly, the property market has continued to surge, and the stock market has also experienced two bull markets. The RMB exchange rate against the U.S. dollar has also appreciated from 8 at the beginning to around 6 this year, making a lot of money.

International hot money has also experienced a complete cycle of inflows and outflows during this period, and it is currently in the outflow stage.

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(Ps: A wave broke out today...)