Reborn with wealth that rivals the country

At that time, under the stimulation of the long-term high growth of Xiangguo, everyone from the government to the people was very optimistic about the future.

Therefore, many problems encountered in the development process were ignored.

First of all, the economic lifeline of Xiangguo was mostly controlled by foreign capital.

Xiangguo itself had no industrial foundation, but it took advantage of the transfer of foreign capital to become an emerging industrial country.

Since the 1980s, Xiangguo has started to produce cars, but to date, it still does not have its own car brand.

The reason is that no matter how prosperous Xiangguo's industry looks on the surface, its core is still a low-end supply chain of foreign capital. Except for the basic labor force, the rest of the equipment, technology, core components and even engineers are all from foreign companies, and none of them belong to themselves.

This is very similar to the early Daxia, which is why Daxia in the previous life would rather endure the pain of economic downturn and insist on industrial upgrading.

The bulk of the profits are in the hands of foreign manufacturers, and Xiangguo can only get the meager profits that flow out of the fingernails of foreign capital.

Just like an Apple phone, for example, a phone sells for 10,000 yuan, and the profit is as high as 6,000 yuan, but the factory responsible for assembly and processing can only get a few hundred yuan per phone.

In fact, Xiangguo had a choice back then. Either tighten its belt, work hard for generations, and build its own full industrial chain; or, like the four little dragons in the East, dig deep into its own advantages, take an export-oriented route, and become an oriental cargo distribution center or financial center.

However, Xiangguo chose to lie flat.

Because the prosperity brought by the free economy is too high!

Xiangguo relies on foreign capital, and the finances of the official and royal families of all dynasties have been rich, and they have never worried about money.

The masters are all fat, who cares if you live comfortably at the bottom?

In order to retain foreign capital, Xiangguo can only allow the labor force to continue to be cheap, resulting in the quality of the people being suppressed at the bottom.

The only thing that the people at the bottom of Xiangguo can leave to the next generation is the spirit of cattle and horses passed down from generation to generation. In the foreseeable future, there is almost no ability to turn over.

In fact, it is normal for Xiangguo to do this. After all, you can make money by lying down. Why should you tighten your belt to transform?

However, in the 1990s, the hegemonic currency changed the weak trend of the main currencies and began to become tough.

Under the pegged exchange rate system, Xiangguo's currency can only be forced to appreciate with the hegemonic currency.

Some people will ask, isn't currency appreciation a good thing? Money is valuable, purchasing power is strong, won't the people be happy?

In fact, it is not like this.

Currency appreciation is very unfavorable to exports, because foreigners need to pay more to buy Xiangguo's things, and Xiangguo's exports have suffered a serious blow.

Xiangguo is also a country that relies heavily on exports. If exports fail, the economy will naturally fail, and the people will not be happy.

In this way, Xiangguo fell directly from an annual growth rate of nearly 20% in the past to negative growth.

The fiscal deficit began to appear serious.

In 1995, the fiscal deficit reached 8.3% of GDP.

In order to make up for the deficit, Xiangguo can only open more capital projects and borrow foreign debt. Because it does not have any irreplaceable industrial industry, it can only beg for money from foreign capital.

But there are still many legacy issues in Xiangguo's deficit.

Since the 1980s, Xiangguo's investment in public welfare has been unlimited, but because the majority of profits are in foreign-funded enterprises, plus tax concessions, there is actually little money in the official pocket.

In order to meet the needs of continuous squandering, the royal family and officials of Xiangguo can only borrow money continuously.

So when Xiangguo's economy was the hottest, a strange phenomenon appeared. On the one hand, hot money from all over the country poured into Xiangguo, and on the other hand, the scale of Xiangguo's foreign debt increased significantly.

By 1996, Xiangguo's foreign debt level had reached an astonishing 930 billion hegemony currency.

That was 1996!!!

How much money was the GDP of Daxia?

Xiangguo's foreign debt dared to pile up so high.

Xiangguo's inflation naturally rose accordingly.

But after all, Xiangguo's economy has been developing at a high speed for so many years, so the people are not too worried about the high inflation phenomenon.

Even under the false appearance of a hot economy, many people still took out their money to invest in financial management and real estate speculation, hoping to make money from money and live a life of luxury.

The official debt of Xiangguo was high, and the financial sector was overheated, resulting in an exaggerated bubble.

However, at this time, the official Xiangguo was already in a difficult situation.

To reverse the economic situation, it was necessary to abandon the exchange rate policy of pegging the hegemonic currency and let the Xiangguo currency depreciate to expand exports.

But if the Xiangguo currency depreciated, the debt would become larger, which would make the domestic economic situation worse.

In the end, the Xiangguo government decided to maintain the peg system as much as possible and raise interest rates.

However, if the official bank's interest rate is high, it will inhibit investment and consumption, and also further deteriorate the Xiangguo economy.

At this time, the financial tycoons smelled the smell and came.

Soros, the defeated general of Chen Mo, the former world's number one short seller, and the owner of the Atomic Fund, believed that Xiangguo's financial sector was overheated, but the country's financial system was as fragile as paper, and it was a very suitable target for short selling.

So the story of Soros shorting the Xiangguo currency, which everyone is familiar with, came!

Although the Elephant Country officials mobilized all of their foreign exchange reserves and dragged the Lion Country into the battlefield, it was ultimately in vain.

Because Soros and other international short sellers have already figured out the foreign exchange reserves of Xiangguo, they know that Xiangguo can't withstand the short selling of so many short sellers.

At the end of June, when Xiangguo consumed the last 30 billion of its foreign exchange reserves, the situation was completely irreversible.

Xiangguo was forced to abandon the fixed exchange rate system that had been maintained for more than ten years and implement a floating exchange rate system.

Within a few hours of that day, the decline of Xiangguo's currency exceeded 30%, almost causing the collapse of Xiangguo's currency and bankruptcy of Xiangguo.

Soros and other big short sellers were not satisfied with just shorting Xiangguo, and also swept across the entire southeast, eventually leading to a financial crisis that shocked the world.

It can be said that what Chen Mo is doing now has been done by Soros ten years ago. The only difference is the target and the scale of funds.

In this financial crisis, Xiangguo's economy fell into a major recession, many banks and financial institutions collapsed, and enterprises went bankrupt in batches, with more than 3 million unemployed people! ! !

A large number of rich and middle-class people fell back into poverty overnight.

Every day, stockholders and investors jumped off the rooftop.

Since the currency of Xiangguo has almost become waste paper, the prices of Xiangguo have soared to the sky, theft, robbery and murder have occurred frequently, and the world's famous tourist destinations have fallen into chaos.

It can be said that Xiangguo was only one step away from bankruptcy at this time.

At this time, the IMF under the name of the foundation finally took action and said that it could provide a large amount of aid funds.

In fact, it was to "shear the sheep".

The aid conditions set by the IMF's target countries are to open up the financial market and control over state-owned assets to facilitate foreign capital to enter the market for harvesting.

Xiangguo had no choice but to accept all the conditions, which temporarily relieved the bankruptcy crisis.

But the price was that a large number of high-quality assets were taken advantage of by foreign capital, and the country's decades of savings were plundered, which was more than the money lost in a war!

At the same time, the per capita GDP plummeted by 60%, and the living standards of the people plummeted.

After 10 years of recuperation, Xiangguo barely recovered to the level of 1996 in 2008.

Now the officials and royal family of Xiangguo want to take advantage of this opportunity to harvest Keguo and hedge against Chen Mo to earn back the lost assets, and also want to rely on this opportunity to break through the shackles of developing countries and become a developed country in one fell swoop!

"As long as the hedge against Chen Mo is successful, our Xiangguo can reproduce the glory of the past, and even go one step further and become a developed country!!!"

When he thought of this, Seta couldn't help but tremble with excitement.