Bab 1006: Chapter 1006: I want the Hong Kong stock market to turn bearish!
That afternoon, Song Bo delivered the collected information to Xia Yu. After browsing it for a while, Xia Yu handed it over to the think tank and asked them to get started immediately and come up with a preliminary plan for the meeting two days later.
Two days later, Song Bo arrived again, and Xia Yu closed the door and held a secret meeting, approving the preliminary plan.
After the general direction was set, Xia Yu was ready to have his financial company secretly take action.
Just as he was about to leave, he received a call from Liu Tianci, and the information mentioned briefly on the phone made him dismiss the idea of going to Jiuding Securities, and ordered Liu Tianci to come to his office immediately.
After hanging up the phone, Xia Yu pondered for a moment, then called Wang Qi again, asking him to come to his office as well. He then fell into deep thought.
Twenty minutes later, Liu Tianci came in, looking tired.
'Chairman, I'm sorry I'm late,'
he said apologetically, and then smiled and nodded at the rising Wang Qi.
'You were quick to get here from Central, so sit down and tell me about it!'
After gesturing for Liu Tinci to sit down, Xia Yu also got up from his desk and sat down on the sofa.
He got straight to the point and asked, 'Tinci, tell me again in detail about what you mentioned on the phone just now.'
'Wang Qi, listen carefully, this matter is extremely important,'
Xia Yu added, exhorting Wang Qi.
Wang Qi had rarely seen Chairman Xia Yu act in such a manner, so he nodded emphatically, focusing 120% of his attention, leaning slightly forward and staring intently at Liu Tianci.
Liu Tianci thought for a moment and said in detail, 'Chairman, just this morning, the Heung Kong Bankers Association held a regular meeting, with all members present, to discuss how to deal with the series of negative impacts brought about by the appreciation of the US dollar.
'According to market feedback, the interest rate gap between the Hong Kong dollar and the Eurodollar has reached 3.5%, and the US dollar is still rising, further increasing exchange rate risks. Capital has already begun to flow out of Hong Kong, with many Hong Kong-funded enterprises moving their funds overseas to earn interest. The investment environment in Hong Kong has deteriorated. If we don't find a way to stop the outflow of capital, the amount of capital in Hong Kong will decrease, and the operating risks of banks will further increase...'
'HSBC has proposed raising interest rates, increasing all interest rates by about one percent, to offset the impact of the appreciation of the US dollar and minimise the interest rate differential...'
As Liu Tianzhi continued to speak, Wang Qi's brow furrowed deeper and deeper, and his heart could not calm down.
HSBC is a note-issuing bank, and now it has proposed raising interest rates, so other banks will definitely support it, which will reduce their risks.
Raising interest rates means increasing interest rates, not only deposit interest rates, but also loan interest rates.
When interest rates rise, it means that the cost of borrowing for people increases, and the burden on those with a shortage of funds also becomes heavier. Their borrowing needs will be restricted, which increases their burden. Only those who deposit money will increase their income.
Once all banks in Hong Kong raise interest rates uniformly, they can attract external short-term capital inflows, reduce or eliminate the deficit, and then the amount of deposits in banks will increase.
But!
Raising interest rates will increase the investment costs of manufacturers. When the interest rate level rises, on the one hand, it will reduce consumption and increase savings, expand the supply of social funds, and thus potentially expand social output. On the other hand, it may inhibit investment, thereby reducing social output.
Even if external funds return, most of them will go to the banks. Since there is already so much capital in Hong Kong, if more goes into bank deposits, less will be invested in the capital market. As a result, the trading volume of the stock market will decline, which will be somewhat detrimental to investment institutions such as Jiuding Securities.
If the funds in the stock market do not circulate well, and if there is a slip-up, the stock market will fall!
...
After Liu Tianci finished speaking, Wang Qi impatiently asked, 'Mr Liu, according to what you just said, HSBC only proposed it for the first time. Do you personally think that the interest rate hike proposal will pass 100%?'
Liu Tianci pondered for a moment, then nodded firmly and said, 'Wang, I can't guarantee it 100%, but in my personal opinion, it will pass with 99% certainty, and it won't take more than half a month. The key now is the exact rate of the interest hike.'
Wang Qi's face fell, his brows knitted, and his fists clenched subconsciously.
Xia Yu glanced at Wang Qi and said indifferently, 'Wang Qi, don't dwell on it. In my opinion, this will happen 100%, and there's no point in trying to stop it.'
It is no wonder that Xia Yu has this attitude, because he knows the real situation of the Hong Kong dollar exchange rate. The Hong Kong dollar has been pegged to the US dollar since 1972, but there is a lot to learn about this peg.
Hong Kong does not currently have a linked exchange rate system, so although the Hong Kong dollar has always fluctuated with the US dollar at 4.6 to 1, it is not as fixed as the future rate of around 7.8 to 1. Therefore, under this exchange rate system, the Hong Kong dollar exchange rate is free, but it is also more uncontrollable and risky.
Nowadays, Hong Kong does not have a monetary authority, only the Exchange Fund Management Bureau and the Banking Regulatory Office. The Banking Regulatory Office does not even have as much power as the Hong Kong Association of Banks, which was transformed from the Hong Kong Foreign Exchange Banks Association at the beginning of this year. This is because the power to issue Hong Kong dollars is concentrated in the hands of HSBC and Standard Chartered Bank. Although the Hong Kong government also has the power to issue banknotes, it only has 10% of the power.
The Exchange Fund Management Bureau, due to the exchange rate system, does not have particularly strong control and intervention capabilities over foreign exchange.
Therefore, the Hong Kong Association of Banks can do it themselves, just like the Federal Reserve, to raise the bank exchange rate and indirectly influence the exchange rate.
That being said.
Seeing that Wang Qi's brows had not completely relaxed, Xia Yu continued, 'Even if the Hong Kong Association of Banks does not make adjustments, then the interest rate differential will always exist, capital will continue to flow out, and the amount of capital flowing into the stock market will also decrease. At that time, not only will investment institutions suffer, but banks will also suffer.'
'Weighing the two disadvantages, take the lesser one.'
'The Hong Kong Association of Banks raising interest rates is better than doing nothing for Hong Kong as a whole.'
'The key now is how to deal with the bear market that is coming.'
Bear market!!!
As Xia Yu finished speaking, Wang Qi was startled and looked at Xia Yu sharply. He asked nervously, 'Chairman, do you think the stock market has reached its peak?'
Liu Tianci also stared at Xia Yu intently, becoming nervous as well. His brain quickly analysed why the chairman would make such a judgement.
Could the consequences of the interest rate hike announced by the Banking Association be so serious?
Xia Yu smiled faintly, did not answer Wang Qi's question, but instead asked in return, 'Wang Qi, what point has the Hang Seng Index reached now?'
Without thinking, Wang Qi reported the Hang Seng Index after this morning's opening: '1,837.30 points!'
Xia Yu asked again, 'If you think back to the situation in previous years, is the current HSI high or low?'
Wang Qi frowned and thought for a long time, thinking further ahead. Feeling a little dry in his mouth, he nodded and said, 'It's already very high, even surpassing the peak during the 1973 stock market crash, setting a new record high for Hong Kong stocks!'
'But Chairman, although the enthusiasm for stock speculation is high right now, investors are not as crazy as they were in 1973, and after so many years of development, the capacity of Hong Kong's capital market has far exceeded what it was before,'
He was a survivor of the terrible stock market crash of 1973 and knew the stock market frenzy of that time.
There were some crazy phenomena in the market, such as 'shark fin rice', 'stock investors quitting their jobs to trade full-time', 'abalone porridge', 'using grouper to make fish balls', and 'lighting a cigarette with a big note (HK$500 banknote)'.
There was also a joke circulating among the people that the Castle Peak Psychiatric Hospital also had a stock exchange, specifically for people who had gone crazy from stock speculation.
The Hong Kong government had to find an excuse that the stock exchange had fire hazards and deployed the fire department to forcibly evict the shareholders, in an attempt to cool down the stock market.
At that time, the Hang Seng Index reached a peak of 1,774.96, and then fell to a low of 150.11 in nine months, a drop of 91.5%.
Although today's Hang Seng Index has surpassed the peak of the 1973 stock market crash and reached a record high for Hong Kong stocks, Wang Qi is certain that although the market is hot, it is definitely not crazy!
Wang Qi did not discover this not because he was incompetent, but because there were multiple reasons for this bear market. A rate hike alone was not enough to cause the stock market to crash.
Xia Yu was very clear that this bear market could be considered a policy market. The rate hike caused the stock market to fluctuate, but the future of Hong Kong was the important reason for the market panic and the decline of the stock market.
In this life, due to his reasons, there have been great changes. For example, the current HSI has already surpassed the peak of this stock market crash in the previous life.
However, Xia Yu, who has always kept an eye on the general trend, is not panicking. Although he cannot fully trust his memories from the previous life, he knows his limitations. There are some things he can influence, but there are also things he cannot intervene in, such as the future of Taiwan Province and Hong Kong.
He can deeply influence Hong Kong, but the mainland has always been focused on Taiwan Province. Hong Kong is a testing ground, and this cannot be changed.
Xia Yu believed that the four-character policy for the future generation was definitely being formulated, and that the present generation was not far away, and that he would definitely be able to get advance information.
Moreover, with his power, he could also offset the negative effects, the key was whether he was willing to do it!
At one point, he had wanted to actively stabilise the situation in Hong Kong, but after spending some time in the United States and returning, he saw that there had been no progress on the merger of the four institutions. Looking at the Hong Kong stock market, which was full of loopholes and had an unsound system, he was dissatisfied!
Hong Kong is his old lair, and he also wants to turn Hong Kong into an international financial capital. But now the Hong Kong stock market is full of loopholes, and a rotten barrel with holes in it will let the sand run through even if it is full!
The merger of the four institutions is like rebuilding a new barrel, but the progress of building this new barrel is too slow, and it will be a mistake!
Now that the interest rate hike by the Hong Kong Association of Banks is imminent, the stock market is bound to fluctuate. Whether it will fall or rise depends on whether he intervenes and how he wants the stock market to go.
His attitude is now clear: he wants the Hong Kong stock market to turn bearish!
However, there are some things that have not happened, and he cannot provide evidence, so he is not in a position to tell Wang Qi.
So he can only domineeringly reply, 'Wang Qi, your analysis is correct, but I need the Hong Kong stock market to turn bearish!'
Wang Qi is suddenly dumbfounded, looking at Xia Yu and not knowing what to say.
Liu Tianci is frowning, trying to figure out Xia Yu's deeper meaning.
After a long while, Wang Qi asked in a daze, 'Chairman, aren't you planning to go to war with the Taikoo consortium?'
'Once we start fighting, the trading volume in the stock market will skyrocket. The Hang Seng Index will rise, which should be able to offset the negative impact of the interest rate hike by the Hong Kong Association of Banks. How can we start a bear market?'
Status Power Mingguan
-- Peringkat
Power 
-- Power
stone