Rebirth Starts From 2006

Why is it said that the development of commercial banking business by investment banks is also a means of risk control?

Why do you say that as long as Goldman Sachs and Morgan Stanley become member shareholders of the Federal Reserve, if they encounter a similar crisis in the future, the Federal Reserve can justifiably launch a bailout for them?

Qin Yu and Huang Shan, two financial experts, would naturally not ask such a simple question.

Only Zou Rong, a novice in finance, could have blank eyes, as if listening to a book from heaven.

Huang Shan, who was thinking about Boss Chen's words, saw that the wife of the boss had finished taking notes but had no idea what she had written. She couldn't help but laugh and said,

“Because the source of funds of investment banks is different from traditional commercial banks, they mainly rely on repurchases and repurchases, and repurchase business belongs to wholesale banks, which is what we often call big customer services.

Compared with ordinary retail banks, this type of funding source is very unstable and is prone to runs in the event of a crisis.

For example, last month, this was the case with Madoff, which we brought down.

The source of funds for commercial banks is user deposits, and then through some intermediary businesses such as loans and commercial bills, they can make steady profits with almost no big risks.

Under normal circumstances, unless there is a very extreme credit crisis, commercial banks rarely experience bank runs, which leaves enough cash flow for the bank.

If an investment bank also has commercial banking business, then its business structure will be optimized.

Although the overall performance is not as good as that of a pure investment bank, from the perspective of risk control, the risk will be lower.

When encountering a financial crisis similar to this one, investment banks can use the deposits of commercial banks to provide themselves with funds, that is, they provide themselves with loans to avoid a break in the capital chain.

This is equivalent to having one more way out, which reduces its own business risks in disguise. That’s why it is said that investment banks’ development of commercial banking business is also a means of risk control.

Moreover, another advantage of Goldman Sachs and Morgan Stanley becoming commercial banks is that they can become members of the Federal Reserve, or even shareholders, and obtain the Federal Reserve's special drawing rights. In times of crisis, they can receive assistance from the Federal Reserve. "

"oh,"

Zou Rong smiled sheepishly, looked at the records she had made, and asked with confusion, "Isn't the Federal Reserve the central bank of the United States? Why does it still have shareholders?

If they become shareholders of the Federal Reserve, will their company be particularly powerful and able to influence U.S. financial policy? "

This time Chen Yang did not let Huang Shan do it for him, and explained to his wife, "As for your question, it can be said to be a very common misunderstanding.

Of course, this impression can only be obtained by referring to our country’s financial system.

However, as long as you understand the history of the Federal Reserve and the rights and obligations of their shareholders, you can understand it. "

After saying this, Chen Yang saw Huang Shan and Qin Yu busy working on the computer, and knew that they were trying to verify their opinions.

Anyway, I have nothing to do, so I will educate my wife about the real situation of the Federal Reserve.

Chen Yang took a sip of tea and smiled at Zou Rong,

"If the United States is the financial center of the world and Wall Street is the financial center of the United States, then the Federal Reserve is the one who can control Wall Street.

As the world's most influential financial decision-making body, his every move attracts worldwide attention and will affect the ups and downs of the global financial market.

It is such an organization, and all its decisions are open and transparent. However, have you noticed that almost everyone feels that there is a mysterious hazy feeling about it? "

"Yeah, yeah,"

Zou Rong nodded like a chicken pecking at rice, "Don't talk about laymen, when I used to work at Min'an Bank, my colleagues thought they were very mysterious when they mentioned the Federal Reserve. Why is this?"

Chen Yang raised his head and laughed twice before saying,

"This is because many people are speculating whether this financial regulatory agency, which was transformed from a private bank, is controlled by private individuals.

This private person can be a consortium, a family, an alliance, or even a giant tycoon.

For example, the often mentioned Rothschild family is regarded as the ultimate controller of the Federal Reserve in the book "Currency War", or the financial tycoons of Switzerland and Saudi Arabia.

Of course, there are also the Jews who occupy half of the American financial world.

Think about it carefully, is that true? "

Before Chen Yang could finish his words, Zou Rong nodded vigorously, "Yes, there are Rockefeller and Morgan. The elephant belongs to Rockefeller, the donkey belongs to Morgan, and then the two families jointly control the beauty and bitch!"

After a pause, Zou Rong blinked at her husband, "Is this really the case?"

Huang Shan, who was busy next to her, couldn't help laughing when she heard this.

Seeing her like this, Zou Rong couldn't help but blush slightly, knowing that she was making a joke.

However, this statement seems to be very common, right?

Chen Yang knocked on the table and glared at the two people who couldn't stop laughing with great dissatisfaction, "Don't use your profession to ridicule wrong social common sense."

"Sorry sorry,"

Huang Shan waved her hands with a smile and said with a smile to Zou Rong, "I'm not talking to you, it's because I've heard this kind of thing many times. I thought so before, but I didn't know until I learned the real situation later. How ridiculous.”

Qin Yu on the screen also took the time to smile at the camera, "Hey, don't tell me, there are quite a lot of similar things like this, and there is quite a market for it. No matter how you explain it, many people still believe it."

Then he paused and looked at Zou Rong again, "Rong Rong, I'm not talking about you. Let the boss explain it to you later and you will understand.

But, to be honest, you will be the boss of a super financial group in the future, so knowing more about this will only do you good and not bad. "

Zou Rong naturally wouldn't be angry. She smiled and waved her hand. She felt that the second half of what she said was right, so she nodded vigorously.

When Rainbow Group really succeeds in acquiring Santander Bank, it will naturally become a world-class financial giant. Under such circumstances, I am still a financial novice, which is really unjustifiable!

Chen Yang held the tea cup, leaned back on the chair, and said softly, "There is no shortage of market for conspiracy theories at any time. However, sometimes these conspiracy theories are very reasonable and not groundless."

As he said that, he turned to look at Zou Rong,

"For example, the Federal Reserve, so many people are willing to believe in these conspiracy theories, is because the Federal Reserve, as a regulatory agency, is a non-political department, and it also has its own board of directors and council, with members and shareholders.

Since there are shareholders, doesn't that mean that the Federal Reserve is in the hands of a consortium? ! "

Zou Rong stopped talking this time and looked at her husband eagerly, waiting for him to explain her doubts.

Chen Yang grinned, "So, is the real owner of the Federal Reserve the financial consortium?

The answer is,

yes! "

"ah?"

Zou Rong was immediately confused.

If so, then what did you say just now?

Seeing the little girl's confused look, Chen Yang raised his head and laughed twice before continuing,

"The Federal Reserve can be roughly divided into three stages, the First Bank period, the Second Bank period, and the current Federal Reserve.

In the first two stages, as well as the early days of the Federal Reserve, the central bank institution of this beautiful country was indeed under the control of a consortium.

For example, after the Revolutionary War, in order to solve the debt of tens of millions of dollars at that time, Hamilton, the first Treasury Secretary of the United States, established a privatized central bank based on the Bank of England, and this bank issued currency. The First Bank of 1791,

This is the earliest policy bank with the nature of a central bank and some functions in the United States. Its shareholders are all private or private financial institutions. Seventy percent of the equity is controlled by European consortiums, among which the Rothschild family directly and indirectly The controlling stake is approximately between 20 and 25 percent,”

Seeing the little girl's mouth open wide, Chen Yang smiled and shrugged, "So it's obvious that the United States at that time was indeed under the control of Rothschild!"

Zou Rong asked in confusion, "Why do they allow private consortiums to control banks?"

Normal people can understand that this is tantamount to handing over the country's financial power to the hands of consortiums!

Chen Yang shrugged, "Because the United States had no money at that time!"

There was no need for Zou Rong to continue asking questions, so he explained,

“At that time, in order to win the War of Independence, the United States had to borrow from European consortiums, amounting to tens of millions of dollars. At that time, that was a huge sum of money!

In order to pay off the debt, Hamilton proposed the revolving door plan, which was to establish a private central bank and allow European consortiums to take control of it to pay off the debt.

However, Americans are not fools either. Their founding president only gave this central bank approval a validity period of twenty years! "

After a pause, he continued,

“After the First Bank expired, the United States did not immediately establish a central bank;

As a result, the year after the First Bank closed, that is, in 1812, the Napoleonic War broke out in Europe. The United States was at odds with Britain because of certain actions, and the second Anglo-American War broke out! "

"understood!"

After he finished speaking, Zou Rong immediately said confidently, "It's another debt that I can't pay back, and then there is a second bank!"

"puff……"

When Huang Shan, who was working, heard this, she held her stomach and giggled non-stop.

Zou Rong looked at her with a confused face, "Isn't it?"

"No, no, no,"

Huang Shan lay on the table, covering her stomach with one hand, waving her hand with the other, and said out of breath, "It's even better if you're right!"

Chen Yang also shrugged gloatingly and continued,

"The Second Bank, established in 1816, took over the functions and structure of the First Bank. The controlling stake was also in the hands of the consortium. However, at this time, the American consortium and the European consortium were split 50-50.

But for the same reason, even though the Second Bank existed longer than the First Bank, it was still inevitable to close.

After the collapse of the Second Bank, the United States did not have a financial institution with a "central bank" nature for 70 years.

Until 1913. "

At this point, Chen Yang paused and asked Zou Rong meaningfully, "What do you think about the United States at this time?"

Zou Rong rolled her eyes and blurted out immediately, "Morgan and Rockefeller!"

According to junior high school textbooks, the most influential families in the United States at that time were these two families, which almost controlled the entire American economy.

"That's right,"

Chen Yang snapped his fingers and said with a smile, "These are the two companies, Rockefeller's oil and Morgan's finance.

In 1913, bankers represented by Morgan held a secret meeting on Jekyll Island for more than half a month, and finally announced the birth of the Federal Reserve.

Moreover, at that time, both the top leader of the Federal Reserve, Benjamin Strong, and the drafter of the structural system, Nelson Aldrich, were closely related to financial consortiums, especially the Morgan family.

To say that the Federal Reserve at that time got rid of the consortium companies, no one believed it!

Even further, the Federal Reserve at that time was under the control of the Morgan family!

However, the current Federal Reserve, after several major system and institutional reforms and improvements, is completely different.

The most typical feature,"

Chen Yang raised a finger and was about to speak.

"alright!"

At this moment, Qin Yu suddenly said, "I contacted Shirley and Fuld successively, and they confirmed the same news through their respective channels.

Goldman Sachs and Morgan Stanley are both lobbying the Treasury Department and the Federal Reserve. The specific content is unknown, but it may be related to the hope of receiving bailout.

However, it is definitely more than just rescue,

Because many of the council and board members they contacted were related to the supervision of commercial banks.

Shirley and Fuld also concluded that they were seeking to break the ban on commercial banking,

It’s almost certain now,”

As she spoke, she looked at Boss Chen and couldn't help but give a thumbs up, "Boss, you guessed it right again!"

At this time, Huang Shan also raised her head and said seriously, "I confirmed through my former colleagues at Goldman Sachs and American headhunting companies that they are looking for commercial bank management talents!"

Chen Yang shrugged and said, "If you can easily find out this information, it means that Goldman Sachs and Morgan Stanley have reached an alliance.

If nothing else happens, I believe the media will publish an article soon to build momentum for investment banks to directly operate commercial banking business! "

Hearing this, Qin Yu nodded in agreement, "This is a common trick used by American companies. They use public opinion to guide the people and use financial resources to influence Congress, and ultimately achieve their goals."

After she finished speaking, Huang Shan suddenly grinned at Chen Yang,

Boss Chen naturally understood that she was thinking of the book he gave her.

mob.

The same means, the same method, everyone is using it!

After getting this accurate news, Huang Shan and Qin Yu finally breathed a sigh of relief.

On the one hand, I admire Boss Chen’s accurate judgment even more. On the other hand, I am also happy that I can continue to implement the action plan I made in advance.

Huang Shan twisted her neck and stretched, then looked at Zou Rong and said with a smile,

“The Federal Reserve consists of the Federal Reserve Board and twelve Federal Reserve Banks.

The so-called shareholders are shareholders of the Federal Reserve Bank, not shareholders of the Federal Reserve Board.

Because the Federal Reserve is a government agency, these shareholders are not shareholders of the entire Federal Reserve and cannot influence the entire Federal Reserve.

Secondly, shareholders of the Federal Reserve Bank must be its members,

Its members must be savings banks qualified to accept deposits, that is, ordinary commercial banks.

Just like investment banks such as Goldman Sachs, Lehman Brothers, and Morgan Stanley, although they are the world's top financial giants, they cannot become shareholders of the Federal Reserve Bank!

As the founder of the Federal Reserve, Morgan’s core business is in investment banking, but the investment bank was expelled from the Federal Reserve. Obviously, the Federal Reserve is no longer Morgan’s tool back then,”

After saying this, Huang Shan turned to look at Chen Yang, grinned and said,

"Boss, is this the distinctive feature you mentioned?!"