My Fintech Empire

Fang Hong asked: "How much actual usable U.S. dollar cash assets do we have in terms of offshore funds?"

Upon hearing this, Tian Jiayi immediately replied: "Including diving funds, the total scale of funds already in place is US$750 billion. These funds do not contain leverage components. If necessary, five times the leverage can be leveraged."

The scale of funds that leverages five times the leverage is 3.75 trillion, which is almost the ultimate amount of funds at the same level as the scale of national foreign exchange reserves.

Fang Hong couldn't help but smile when he heard this number, and said calmly: "It's not like using 750 billion US dollars to leverage five times the leverage. Of course, you should use other people's money to do your own business first." Things are safer and more secure, of which 700 billion US dollars should be kept low-key and not touched, use 50 billion US dollars to operate with high leverage, and use 5 times leverage to operate 300 billion US dollars of funds."

Regarding this game of foreign exchange war, Fang Hong is almost absolutely sure of winning because the advantage is too great.

As long as the onshore RMB market is stabilized and does not trigger a panic run on foreign exchange, international short sellers have no chance of winning, unless there are insiders lurking in the headquarters. But even in this situation, Fang Hong still has the ability to remedy the situation and turn the tide.

This is why he uses other people's money to do his own business. With a huge amount of offshore funds of US$750 billion, Fang Hong cannot drag out all of this money, especially the diving funds that will not be exposed easily.

Just take out 300 billion US dollars, and the actual principal of this money is 50 billion US dollars, and the rest is all leveraged funds.

Fang Hong's layout is to prevent several moves, including the potential risk of his opponent pulling out the network cable and confiscating his home. If his opponent ignores the rules of the game and acts rogue, he will directly freeze your 300 billion US dollars or even confiscate it. Fang Hong will lose at most 500. Billion US dollars, as for the leveraged funds above, they will not repay a penny, debt collection? Go to Lao Mei's place to chase her, the money is frozen by him.

As long as the opponent is acting rogue, Fang Hong will not hesitate to default on the bill and focus on hurting each other.

When you come up, you have to pay 750 billion of your own real money. If it is blasted in a directional way, you will cry to death. You won't be able to find the ground even if you cry. You must have a steady hand.

With the US$300 billion leveraged five times, the current balance of offshore RMB deposits is close to about 2 trillion yuan, which is almost enough to offset the balance of offshore RMB deposits.

If it's not enough, just add more. There's still 700 billion worth of ammunition in the trunk that can be used at any time.

At the end, Fang Hong gave this order: "In this foreign exchange war, I will not go to the front line to direct the trading. I will instruct the trading team under me to start picking up the goods now. We will take as many RMB as the short sellers put. The upper limit is ours." We can receive 5 trillion yuan, which is to hedge the US$750 billion mobilized this time.”

A true master-level strategy is so simple and unpretentious, not as fancy as outsiders imagine.

The total balance of offshore RMB deposits is now about 2 trillion, and you can eat it all without hiccups. Fang Hong added: "In the future, we will continue to buy RMB until we buy around 10 trillion before we stop." , from now on Qunxing will steadily hold 10 trillion yuan in the offshore market."

Hearing this number, Tian Jiayi's beautiful eyes widened immediately: "So many? How can we get it out in the future?"

Hearing this, Fang Hong looked at him: "Come out? Why do you want to come out? I never thought about going out. The stars holding 10 trillion offshore funds in their hands are like holding a financial nuclear bomb, and their position is even stronger." Like a rock, its weight is even more important. Who dares to move the stars in the future?"

Tian Jiayi suddenly said: "So that's it..."

At this time, Qunxing can confidently and boldly buy RMB in the offshore market, and I hope you can buy more and stabilize the exchange rate. Others will not be able to find an excuse to use this matter as an excuse. After this foreign exchange war is over, Qunxing will It has become an established fact that China holds huge amounts of RMB in the offshore market.

And no one can take such a large amount. Instead, I hope you will hold it. You must not sell it. If you sell it, the exchange rate will really collapse.

Fang Hong turned to smile and said: "The hegemony of the US dollar will one day come to an end, and the internationalization of the RMB is gradually gaining momentum. As the old saying goes, destiny is here for the rise of the RMB. Even if it depreciates now, it is just a small period. It’s just a fluctuation. Once the time period is extended, it will be a different story.”

Obviously, Fang Hong's move also unswervingly believes that the destiny of the country lies in the east. No matter how bright the lighthouse of the west is now, when the sun rises in the east, the lighthouse of the west is destined to be eclipsed in front of it.

So just take it.

After a while, Fang Hong ignored the topic and said: "By the way, keep an eye on the HK interbank overnight lending rate. The decisive point this time is to use the interbank lending rate to excite short-seller capital."

For this duel in the foreign exchange market, the general idea is that Qunxing and Yangxing will cooperate and be responsible for the offshore market and the onshore market respectively.

In the onshore market, Yangyang Bank has turned off the faucet. This has already been done, such as last month’s window guidance, suspending individual cross-border businesses and participating banks’ domestic foreign exchange business, etc. Relevant departments are also focusing on cracking down on underground banks, etc. .

In the offshore market, Qunxing is pumping water. The overall idea of ​​international short capital is to let the RMB plummet in the offshore market drive the onshore market to follow suit, which will have the effect of making a huge difference and will inevitably sell RMB crazily in the offshore market. Go short. And Fang Hong turned into Pixiu and could only get in and out. He could catch as many dollars as his opponent threw with the dollars in his hand.

The faucet over there is closed, and the water that has been released here is drained out. This will lead to a situation where the water in the pool will become less and less, and the offshore RMB will not have much circulation scale, and it will become a market Goods are in short supply and will definitely rise sharply if they are scarce.

This will inevitably trigger a chain reaction, which will be directly transmitted to the surge in the inter-bank lending rate in Hong Kong. Fang Hong wants to make the lending rate soar in order to excite short sellers. The rise in the inter-bank lending rate will have a negative impact on the short-selling capital of those who borrow RMB for short selling. It would be a devastating blow.

Because the surge in interest rates will increase the cost of borrowing RMB for short capital, the offshore RMB will inevitably appreciate due to tight supply and demand. Shorts will then face the tragedy of being "double killed" because they have to pay interest every day. Fang Hong wants to make this happen Interest rates have skyrocketed to a point that short sellers can no longer afford.

From the perspective of short capital, the scenario they envision is to borrow large amounts of RMB to sell short, and then the RMB depreciates and plummets. At that time, fewer US dollars can be exchanged for more RMB. The price difference in the middle is profit, as long as the cost of capital is covered. After covering the interest, it is net profit.

But if the offshore RMB does not depreciate, instead of depreciating but violently appreciating, the result for the short sellers will be an explosion on the spot.

Fang Hong doesn't even need to push up the appreciation of the RMB. As long as the exchange rate is kept stable, the short sellers are bound to lose. What the short capital side needs is a quick resolution, because they are paying high interest costs every day, and the longer they delay it. The cost of capital will continue to rise, and all losses will be profits. Once floating losses cover profits, all losses will be principal.

As long as the RMB is stable for a period of time, the short sellers will fall into a prisoner's dilemma situation. If there is a push from an outside force, the short sellers will trigger a chain reaction of collapse.

This external force is the rise in overnight lending profits. The compression of profit margins will inevitably lead to some short sellers to surrender first. They can't wait to buy RMB to close their positions, and instead become de facto longs.

But what is really fatal at this time is that there are not that many RMB left in the market. The faucet above has been welded to death by Yang Ma, and the existing water in the pool below has been almost drained away by the stars.

The market at this time will follow the most essential logic. If supply exceeds demand, the price will inevitably be high. If you are eager to buy RMB, you can only shout in the market with a loudspeaker that you are willing to pay a higher price. Those with the highest price will be eligible to close their positions first. In this way Doing so will feed back to the high interbank lending rate, and short sellers who have borrowed a large amount of RMB will become extremely sensitive to the interbank lending rate at this time.

When you see interbank interest rates rising, it will trigger more people to rush to close their positions. Since the RMB available in the market is too scarce, if you take it, others will not be able to get it. In order to get it first, you will quote a higher price. You offer 1 yuan, I offer 1 yuan 5, and he immediately shouts 2 yuan, which affects the overnight lending rate and forms a positive feedback reinforcement.

Once the positive feedback effect becomes an established fact, the collapse of the short position will only happen overnight.

…