章節 518: Chapter 518: The Dilemma of the United States
The news of the YSL revolution in Iran and the halt in oil exports shook the world instantly. Especially for developed countries that rely heavily on oil for their development, the impact was profound and alarming.
In the New York futures market, just over a month ago, the world's first oil futures appeared, and the price jumped directly from $14.8 per barrel to $16.1 per barrel, with rapid increases as capital flowed in.
Governments around the world quickly dispatched personnel to Iran, trying to gather the latest and most comprehensive information.
While governments were waiting, capitalists were not sitting idly.
Capitalists are not fools; they know that once a revolution erupts, it is not something that will be resolved in just ten days or half a month.
In this situation, no one can predict when Iran's oil will be back on the market. It could be months, or even years.
Countries like Saudi Arabia and Iraq, even if they wanted to seize Iran's market share, were limited by their own capacities since oil extraction is not an immediate process.
Thus, capital foresaw that oil prices would continue to rise for a considerable time, leading to a series of negative reactions: inflation and continued devaluation of the dollar.
Europe and the U.S. were already mired in economic difficulties. The rise in international oil prices exacerbated their woes, casting a shadow over any small progress they had made.
To avoid losses, capital began to seek refuge rapidly.
There was no doubt that gold became the sole safe haven for capital!
A massive influx of funds surged into the gold markets in New York and London, not only from securities firms, fund companies, and asset management companies, but also from banks and central banks around the world, all buying gold to preserve asset value.
Some industrial companies even invested idle funds into the gold market.
As a result, the vast amount of capital pouring into the gold market continually pushed up gold prices.
Faced with this enormous influx of funds, London's major banks were overwhelmed. Summer's funds seemed insignificant in comparison, and the market information became chaotic, increasing Summer's safety.
---
In Hong Kong, at the Bao family residence.
Bao Yugang and Huo Yingdong were having tea together, their faces beaming with smiles.
"Wow, Old Huo, I didn't expect that Summer Yu would be trading London gold and even predicted the crisis more than half a month in advance. His intelligence capabilities are incredible!" Bao Yugang remarked with admiration.
"Yes, his business intelligence is indeed formidable. In Hong Kong, no one can match him. After all, the Jiuding News Agency is world-renowned. In Hong Kong, it is a unique entity!" Huo Yingdong agreed, nodding in approval, while raising the importance of Jiuding News Agency several levels in his mind.
The news agency could be considered a major national asset, generally funded by the state, but Summer had one privately.
Huo Yingdong suddenly felt a strong impulse to create a news agency of his own. However, he quickly realized that he lacked the capability and suppressed his sudden urge.
"But Summer Yu is also bold and daring. Perhaps his internal market analysis is strong. If it were us, we might not have dared or even discovered it."
"Indeed, although Summer Yu is young, his overall perspective is the best in Hong Kong. Even after decades in the industry, I believe I can't compare with him."
"Now that the gold price has risen by more than 10%, our profit alone is nearly ten million dollars. To be honest, I feel somewhat undeserving since we haven't done anything."
Bao Yugang shook his head and said with a complex expression.
Huo Yingdong laughed, "Old Bao, why think so much? Since Summer Yu only brought us two, we should remember this favor and repay it slowly. Don't you have confidence in providing assistance to Summer Yu in Hong Kong?"
"How could that be? Even though the Fujian Merchants Association and Chaozhou Merchants Association are powerful now, with the two of us combined, we're not afraid of anyone. How could we not provide assistance to Summer Yu?" Bao Yugang said with confidence, displaying the authority of Hong Kong's top tycoon.
As figures at the pinnacle of Hong Kong, Bao Yugang and Huo Yingdong were sharp-minded and could guess some of Summer Yu's thoughts. However, they had no objections.
After all, Summer Yu chose them because he valued them. Mutual benefit and alliances are normal in business.
Summer Yu could have chosen others, but they had no such choice.
With their principle of repaying kindness generously, both were determined to support Summer Yu.
"Old Huo, with Summer Yu not in Hong Kong right now, we can't let ourselves lose face. I may not have the strength in that area as you do, so I need you to bear more."
Bao Yugang said solemnly as he suppressed his smile.
"Don't worry, if the two of us can't handle it, then we have no face to remain in Hong Kong."
Huo Yingdong's eyes flashed with determination as he spoke.
---
While Liu Xiao and George Berkeley were busy, Summer Yu found himself idle.
As he wandered outside, he unknowingly ended up near the Huashang Bank.
Thinking about his role as a shareholder and director of Huashang Bank, yet not fulfilling his responsibilities, Summer Yu decided to visit Huashang Bank.
Amidst respectful greetings from the staff, Summer Yu and Li Qian went upstairs and found Wu Hongyi busy with work.
Upon seeing Summer Yu's arrival, Wu Hongyi put down his work and greeted him with a smile, "Summer Yu, what brings you here?"
"As a member of the bank, how can I be idle?" Summer Yu responded playfully, causing Wu Hongyi to laugh heartily.
"Right, right, right. Look at me talking."
"Come, let's discuss while drinking tea."
Then, Summer Yu entered Wu Hongyi's office, and they began drinking tea.
"Hongyi, how is the bank's liquidity? If there are any surplus funds, I suggest buying all of it in gold to preserve value."
Summer Yu took a sip of tea and said seriously.
Wu Hongyi put down his cup and pondered, "There are still plenty of funds. I saw the news at noon; Iran's revolution has caused gold prices to soar. But Summer Yu, I'm still hesitating. Do you think Iran can withstand the pressure from Europe and the U.S. and continue to close oil exports? Will the U.S. intervene like before? What if they suddenly reopen exports?"
Summer Yu said, "Don't worry. The revolution won't end in the short term. Iran needs to dismantle the constitutional monarchy. Ruhollah Mousavi Khomeini has been in exile for over ten years, remotely commanding the revolution. He won't stop until he achieves his goal."
"On a deeper level, this revolution is a counterattack by the Soviet Union against the U.S. The U.S. probably didn't expect the revolution to erupt so quickly. Even if the U.S. wants to intervene, the Soviet Union will have countermeasures. Remember, Iran is right next to the Soviet Union! The U.S. is too far away!"
Summer Yu's perspective was novel to Wu Hongyi, who had not considered the political angle before. Hearing this, Wu Hongyi felt his thinking expand and carefully pondered Summer Yu's viewpoint.
"So with Soviet support, Khomeini is likely to succeed? The Soviet Union should want to quickly end the revolution and control Iran, right?"
Wu Hongyi asked.
"Revolution isn't that simple. Even if the Soviet Union wants to end it quickly, it depends on the actual situation."
"This revolution, coupled with the halt in oil exports, is likely also a Soviet strategy to put Europe and the U.S. in a difficult position. The Soviet Union seized a good opportunity, so unless the revolution fails, Iran's oil will not be exported again, and NATO's overall pressure won't work!"
Summer Yu smiled, admiring the Soviet plan in his heart.
Wu Hongyi hadn't anticipated the complexities involved and immediately became intrigued, asking, "Why is that?"
"Europe's economy is struggling, and Europe relies heavily on Middle Eastern oil. The U.S. itself is suffering from inflation, with both oil and the dollar being impacted. The U.S. government must find a way to quickly resolve this situation, which requires admitting defeat."
"But if the U.S. sends troops to compete with the Soviet Union in Iran, the revolution will become a proxy war. Due to the domestic sentiments and religious issues in Iran, the U.S. would need to invest several times the effort of the Soviet Union to win, which is extremely difficult."
"If this happens, it will take a long time. U.S. intervention would lead to a surge in anti-American sentiment in Iran. If Iran continues not to export oil, the U.S. will struggle first, while the Soviet Union will be fine."
"After all, the Soviet Union is already under blockade by Europe and the U.S., so it doesn't lack oil and is self-sufficient."
"Even if it comes to the worst-case scenario, Europe might even have to buy oil from the Soviet Union. That would open a loophole in NATO's blockade, which the U.S. would not want to see."
"So now, the U.S. government has no choice. It's better to endure short-term pain rather than meddling in foreign affairs and still have to deal with domestic troubles."
Summer Yu spoke with a smile, articulating his views clearly.
"So with the U.S. passively resisting, the Iranian revolution is likely to succeed. However, the U.S. will not give up easily, and the Middle East will be lively in the future."
"Oh, I digressed. Let's get back to
the issue of gold prices."
"Even if the Iranian revolution succeeds, it will still take at least a few months or even half a year. During these months, oil will not be exported again, and the gold price still has plenty of room to rise."
"Moreover, even if Iran resumes oil exports, the inflation damage to the U.S. will be aggravated, and the dollar will continue to devalue, which won't be easy to reverse. Therefore, in the next year or two, gold prices will continue to rise, so invest with confidence!"
After listening to Summer Yu, Wu Hongyi felt enlightened and smiled, "Hearing you speak is better than reading ten years' worth of books. I've learned a lot!"
"I'll arrange for the funds to be invested in the gold market right away."
Summer Yu nodded with a smile and leisurely enjoyed his tea.
He hadn't informed Wu Hongyi about the revolution before it happened due to the risk and the presence of the old fox in the Wu family. It wasn't worth the risk for Summer Yu.
Even though he was a shareholder of Huashang Bank, it wasn't worth taking that risk.
But now things were different. With the event having occurred, giving Wu Hongyi a heads-up was fine. Even if Wu Chengde had suspicions, it was useless without evidence. Summer Yu was not afraid.
Moreover, as a shareholder, he needed to act rather than do nothing. It was only right to reciprocate kindness and contribute when necessary!
Besides, Huashang Bank making money means he makes money too, doesn't it?
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