Reinventing the Millennium

Flying from Houston to San Francisco, it's like two worlds on both sides.

The whistles, dribbling sounds, and cheers all disappeared from my ears, replaced by a brightly lit office and dense statistical documents.

Fang Zhuo arrived in Silicon Valley at noon. After a brief lunch, the first thing he did was not inspect Yike's R\u0026D center here. Instead, he used his office to have a small meeting with Kong Yu, the head of the MIGA Fund who came from New York. .

Since MIGA Fund and Goldman Sachs got online, it can be said that it has made rapid progress. It not only helped the cooperative banks package CDO shipments, but also tried to get the institution to issue a CDO securities in its name.

In this process, MIGA Fund was very successful and made huge profits.

However, as the person in charge, Kong Yu's hair is falling out more and more.

Especially after receiving the order from Mr. Fang to secretly borrow money and look for shells in other parts of the world, he suffered from insomnia continuously. First, he was worried about the financial market, secondly, he was worried about the MIGA fund, and thirdly, he was worried about himself...

From the project manager who walked into the Hang Lung 23 office carrying a gasoline can to now a well-known fund president on Wall Street, Kong Yu has gained a lot in this process, but he increasingly feels that it is not his ability that matters, but It was lifted to its current position by the development of the market and certain forces.

Knowing too much is not a good thing.

Kong Yu was a little worried that Mr. Fang let him know too much.

Therefore, he came here from New York on his own initiative. He originally planned to go to Houston while President Fang's team was happy to win the championship, but he didn't expect to come to Silicon Valley after making the phone call.

"The profits are good, and Goldman Sachs is still strong. This is enough to open a new ice core factory."

Fang Zhuo flipped through the report from MIGA Fund, paid attention to a few key data and praised it.

Then, he put down the document, looked up at Kong Yu, and asked, "Mr. Kong, why are your eyes red?"

Kong Yu smiled bitterly and said, "The pressure is a bit high."

He came here today to report again on the market situation and to see the boss's attitude.

We had chatted once in the capital before, and we couldn’t talk about it again now.

After Kong Yu said this, he paid attention to Mr. Fang's expression. As expected, he didn't see any surprise, as if he knew the purpose of his trip.

"Add some tea." Fang Zhuo motioned to Mr. Kong to pour him some tea, and threw a cigarette over, "Tell me about the situation."

After Kong Yu poured the tea and lit the cigarette, he felt much more at ease for some reason.

He took two puffs, gathered his thoughts for a while, and started talking about Goldman Sachs: "Mr. Fang, there is a very important situation. Goldman Sachs seems to have a lot of illegal operations in CDO."

Fang Zhuo nodded slightly, indicating that he was listening.

“Because we have been cooperating well with Washington Mutual Bank, in April, considering that the market was very good, I asked the foundation to package some less high-quality loans from several banks into CDOs, and then named them Washington Mutual Bank. Sell ​​it in name."

“In the process, I discovered that Goldman Sachs might be doing something similar.”

Fang Zhuo interrupted: "It sounds legal and compliant."

Kong Yu shook his head and said: "No, our CDO, whether it is Washington Mutual Bank or MIGA Fund, is very formal and has fulfilled its obligation to inform. But the CDO that Goldman Sachs used to flow into the market in its name..."

He first explained his motivation: "Because what Goldman Sachs is doing has some competition with us, I just want to explore and see if I can cooperate with Goldman Sachs in the future and issue CDOs in the name of Goldman Sachs. Therefore, after delving into what Goldman Sachs did, The CDO later discovered that what was packed inside was the garbage of garbage.”

"There are no loans from big banks at all. They are basically small local banks and small financial institutions. For example, Franklin Bank in California only requires 7% down payment for real estate loans, and nearly 40% of the loans are interest first and principal later. Lenders have huge final payments after a few years.”

"There is a huge bubble here, and CDO is a mixture of bubbles and bubbles."

Kong Yu finally said solemnly: "And Goldman Sachs concealed the information of the other party that cooperated with it to issue CDOs. The other party that issued CDOs was shorting CDOs! In other words, they were deliberately creating CDOs that would definitely have problems in order to achieve short selling. Effect."

Fang Zhuo took a sip of tea. This tea was not bad.

Seeing that Fang Zhuo was silent, Kong Yu expressed his opinion: "This is definitely an act of defrauding investors and definitely violates the relevant regulations of the SEC!"

He emphasized: "This is illegal!"

Fang Zhuo was thoughtful and said slowly: "So? Should we cooperate with Goldman Sachs or not?"

Kong Yu: "..."

He reiterated: "Mr. Fang, Goldman Sachs has violated the law. Especially if this type of CDO breaks out, it may have serious consequences, which will lead to a severe investigation of Goldman Sachs' violation of law."

Fang Zhuo nodded: "Goldman Sachs made a mistake."

Just as Kong Yu was about to agree, he suddenly realized the meaning behind Mr. Fang's words. For Goldman Sachs, making mistakes has more serious consequences than breaking the law.

He was silent for a while before he recovered, and then hesitated for a few seconds before saying, "Mr. Fang, I suspect that Goldman Sachs is buying the CDS of its own CDO to hedge risks or try to make a profit."

"Really? Goldman Sachs' operation after eating up the front and back is too exciting." Fang Zhuo said lightly, "So, Mr. Kong, what is your suggestion for the MIGA fund?"

Kong Yu was stunned.

Today, he wanted to use his explosive judgment on Goldman Sachs to see his boss's attitude towards him.

It stands to reason that the two of them should have an in-depth discussion or even find someone to verify Goldman Sachs' operations. Although it is strictly confidential, there is no airtight wall in the world. Even their own secret exploration can find traces. It will be easier for Mr. Fang to take action. .

However, Mr. Fang asked what the MIGA fund should do...

What should we do?

CDOs should still be sold, right? CDS can also be bought and sold. Even if a default occurs, it will probably only be localized and cause market fluctuations.

When Kong Yu's thoughts reached this point, he felt a strong sense of uneasiness.

Can judgments involving the entire financial market be wildly fanciful?

Does it seem too radical to put the risk of certain CDO bubbles and CDS defaults into the entire system?

Kong Yu wanted to say that the MIGA Fund should proceed with caution, but he also always felt that danger was coming. However, the direction of the danger was absurd based on common sense.

He was speechless for a while.

"What is the name of the institution that cooperates with Goldman Sachs to issue CDO securities?" Fang Zhuo asked a specific matter.

"Copper Capital." Kong Yu replied.

Fang Zhuo recalled carefully and had no impression, but that didn't matter. It was enough that he had an impression of John Paulson, the prototype of "The Big Short".

Copper Capital does the same thing as John Paulson, who also cooperates with Goldman Sachs.

It seems that Goldman Sachs is doing a lot of things secretly.

John Paulson took advantage of the subprime mortgage crisis to conduct short selling operations and made profits of more than 20 billion US dollars.

He personally gained billions, most of which were divided up by various institutions.

I believe that Goldman Sachs also has a part in this.

Regarding this subprime mortgage crisis, considering the bad reputation of short selling, the overt and covert influence, and the constraints of purchasing equipment and introducing technology for ice cores, Fang Zhuo believed that we should remain silent while ensuring our own safety. Earn some equipment money and bargain hunting money.

John Paulson at the front can be a useful glove.

Many people know John, and many people know Goldman Sachs. How many people know John’s fund clients?

For safety reasons, funds need to be transferred several times through channels around the world.

This was exactly the order given by Fang Zhuo to Kong Yu.

In addition, you can also look at which companies in need can take advantage of the opportunity to short.

Fang Zhuo plans to install some acceleration plug-ins for Bingxin and Yike this time.

There was a moment of silence in the office, but the mood of the two silences was different.

Kong Yu already had some fear.

"After the MIGA fund products are delivered one after another, you can stop for a while to see how much funds are available." Fang Zhuo drank the tea to the bottom and made a decision that shocked Kong Yu.

"Mr. Fang, we have many high-quality stocks and equity, and we will suffer losses if we stop." Kong Yu said.

"Aren't you just worried about market bubbles when you came to me today?" Fang Zhuo pointed out. "Or, you don't trust your own judgment? There are huge risks in the U.S. financial market?"

Kong Yu actually didn't say this, but he had this idea in his heart.

I haven't slept well in the past few days, but when I heard Mr. Fang say this, I suddenly felt a little dazed. Did I say something similar just now?

Fang Zhuo continued: "I think your judgment is very bold and sharp. No matter what the actual situation is, for us, it is just about making more or less at this time. It is not unacceptable to stop in time."

Say so.

But Kong Yu still feels heartbroken when he thinks about the loss.

Fang Zhuo thought for a while: "The MIGA fund will be temporarily silent after the normal delivery. The next step is to let the funds safely short the market."

Kong Yu had no choice but to speak. He thought carefully and said, "Mr. Fang, what I just said may have been a bit reckless, and there may be some problems with my judgment..."

Fang Zhuo said with emotion: "Mr. Kong, I can tell by looking at your red eyes how much preparation you have made for today's words. I trust your judgment. I have always felt that Mr. Kong has an understanding of the market that no one else can match." Keen talent.”

"The next work will not be particularly complicated, but it will require special caution."

“What we want to do is short-selling in compliance with regulations, but we need to be careful to cover up where the funds are going.”

Fang Zhuo does not plan to let Kong Yu handle the entire process. Different people will be responsible for different scales of funds.

But as a responsible fund manager whose family is in Shanghai, Kong Yu, who is deeply trusted, will undoubtedly be responsible for the largest part of the funds.

Kong Yu was still shocked when he heard the boss's decision, but his original fear had faded a lot.

The thoughts in his mind were intertwined, and he asked again: "Where are the Chinese concept stocks?"

"Sina will keep half of it, and the rest will be treated equally," Fang Zhuo said. "Sina will not have any objection to normal financial operations."

Kong Yu nodded slightly. Regardless of whether he said anything about financial market risks today, Mr. Fang actually already had his own judgment in mind.

Fang Zhuo pondered again and said: "If you add a few more layers of shells, make money in Russia and the Middle East, find people from Europe to come to the United States, and remotely look for opportunities to cooperate with Goldman Sachs, just like the Copper Capital you just mentioned. Learn from it, issue CDOs on a small scale, do some short selling, and make some money."

Paulson, the boss of Goldman Sachs, is about to become a referee, and the cooperation with Goldman Sachs has very good prospects.

Even if Goldman Sachs makes a mistake, the punishment will come only after Paulson's term ends.

The big money can be used to give wings to Bingxin and Yike, and the small money can be used to buy Sony's building. The security is high enough and it will not attract much attention afterwards because of the scale issue.

Kong Yu nodded silently.

The original intention of today was to see Mr. Fang’s attitude, but with the sudden sudden change of MIGA Fund, we still need to digest this decision and the meaning behind it.

Fang Zhuo looked at Kong Yu's complicated expression and asked, "Mr. Kong, is there anything else you need to add?"

"Mr. Fang, I probably need to think about it again. My thoughts are a little confused." Kong Yu said this, and his mind suddenly became clearer. Since Mr. Fang still wants to employ people and still trusts himself, if the American market really When systemic risk occurs, the profits therein are beyond imagination.

He recalled Buffett's famous quote.

Previously, seeing Goldman Sachs' greed frightened him, but now that the fear has passed, it's time for him to be greedy.

"Okay, don't go back to New York for the next few days. If you need to check for any deficiencies, you should also pay attention to the communication tools." Fang Zhuo said calmly, "You should be separated by a few more layers, although there shouldn't be any personal danger. , but also pay a little attention.”

Kong Yu nodded solemnly.

Soon, he left the office and needed to go back to collect his thoughts.

Fang Zhuo picked up the file again, looked through it once, and then took out a file report from another person from the drawer. He was very pleased to find that Kong Yu's behavior was becoming more and more mature. He used to be a bit of a rat store, but now he is becoming more and more cooperative. Ruled.

Some documents are destroyed and some documents remain.

The office drawers are locked.

Soon, matters about the MIGA fund were put aside, and teams from Qualcomm and Google arrived one after another in the afternoon.

Not many people came from Qualcomm. Including the vice president who went to the stadium to watch the game last time, there were only three people in total.

Google paid more attention to it. Not only founder Larry came in person, but CEO Eric also took people to sit in Yike's R\u0026D center.

After communicating with Larry, Eric originally thought that he did not need to come over to participate in this kind of mobile phone cooperation discussion.

But a new piece of news changed his mind.

Sony rejected Google's acquisition of its Android shares, and this part unexpectedly and reasonably fell into the hands of Fang Zhuo. After all, this person has a close relationship with Sony.

Eric considered the significance of the existence of the Android company and wanted to talk about Google's strong desire to acquire it. The remaining parts were concentrated in Fangzhuo's hands, and he might be able to get it at a high price.

Fang Zhuo's appetite may be bigger than Sony's, but after all, there is a price that can impress him, right?

Eric believes that discussing cooperation on the first mobile phone in the Android camp is a good opportunity for communication.