Chapter 439 Taking Action: Winter is Coming

Throughout February, average house prices in Thailand plummeted by 22%, shattering the hopes of homebuyers.

Wang Xiao understands homebuyers' feelings perfectly because she lived during a time when housing prices were plummeting before she transmigrated.

Don't say it doesn't matter if it's a necessity. Banks won't reduce your loan by a single penny just because you bought a house that's a necessity.

Just thinking about all the money you've lost, even if you're still struggling to save up for your mortgage and don't know when you'll ever be able to pay it off, makes you seem like a morally superior person if you don't retaliate against society.

Investors with their eyes on Southeast Asia are watching how the Thai government will bail out the market—real estate involves a vast number of upstream and downstream businesses, such as steel, cement, home appliances, and decoration, all of which rely on it for their livelihood; moreover, banks that issue loans to real estate developers and homebuyers also depend on it for their profits.

If it collapses, the economy will collapse as well.

The Thai government has indeed acted swiftly.

On March 3, the Bank of Thailand publicly announced that nine finance companies and one housing loan company in the country had problems with poor asset quality and insufficient liquidity.

When Wang Xiao saw the faxed announcement, he couldn't help but sigh: "It's time for Soros to make his move."

Xiao Gao and Xiao Zhao have been discussing the Thai economy lately.

Hearing his boss's assessment, Xiao Gao was a little confused: "Did the Thai government make a mistake?"

Was it really wrong?

The faxed commentary from the economist clearly stated that the bad debt problem of Thai financial institutions can no longer be concealed.

Instead of continuing the practice of keeping family scandals private, the government publicly named and pointed out the problems, which is like scraping the bone to remove poison.

Moreover, the Thai government did not just point out the problem, but also said what to do next.

They clearly stated that they required troubled financial companies to increase their capital to $317 million and ordered banks and financial companies to increase their bad debt reserves from 100% to 115% and 120% respectively, in order to enhance the stability of the financial system.

Xiao Gao really couldn't find anything wrong with what he did.

At least in his view, if there's a problem, you can tell him directly. Even if things get really bad, he can calm down after a while and everyone can work together to solve the problem.

What he couldn't stand the most was being kept in the dark as if he were a fool.

Xiao Zhao was completely baffled.

Thailand's economy does indeed have problems, so isn't acknowledging the problems the first step to solving them? It doesn't seem wrong.

Wang Xiao stamped the documents in his hand, shook his head, and said meaningfully, "Then you have underestimated the terrifying nature of market panic. Take a closer look at the data. Thai house prices did not actually start to fall after Wall Street speculative funds launched their attack. On the contrary, they started to fall in mid-January, which gave speculative funds the first signal to attack."

Housing prices, especially those artificially inflated, are generally destined to fall further as prices decline. They're not really about market value, but rather about people's confidence.

Wang Xiao pointed to the data in the document and reminded the bodyguards, "What does this mean? Market panic preceded the attack on the Thai baht by speculative funds, and the latter exacerbated the panic. For the market to maintain confidence, a strong force needs to step forward and convince everyone that the market is healthy and there are no problems."

The two bodyguards understood then that while the Bank of Thailand's initiative to disclose the problem was quite courageous, it was also tantamount to the government publicly admitting that their economic problems were significant and serious.

Because even a fool knows that the government will only publicly acknowledge a problem when it becomes so serious that it can no longer be concealed.

Otherwise, would the government really reflect on such trivial matters?

Impossible. Doesn't the government have any pride?

Xiao Zhao asked curiously, "Then what should the Thai government do?"

The other bodyguards and assistants pricked up their ears, hoping their boss could offer some magic bullet so they could broaden their horizons.

However, Wang Xiao shook his head: "There's no good way. No matter what it does, it's wrong. This is a typical 'trilemma'."

She raised her left index finger, saying, "To maintain a fixed exchange rate, we must ensure the free flow of capital and utilize foreign exchange reserves. Just like the Thai government did, it used $2 billion of its foreign exchange reserves."

She then raised her middle finger, saying, "But foreign exchange reserves are limited. If we want to maintain the free flow of capital, we can only raise interest rates to attract capital to stay."

This action was taken by the Thai government on February 17th, in conjunction with the use of foreign exchange reserves.

However, at the same time, a third dilemma has emerged: "Raising interest rates is a fatal blow to domestic finance companies and real estate enterprises that are already suffering from liquidity problems and are heavily indebted. The soaring cost of loans directly leads to more bad debts and bankruptcies."

Can you say the Thai government did something wrong? It seems like they did nothing wrong.

However, when these factors are combined, it sends a clear signal to international speculative capital represented by Soros: "Come and attack me. My financial system is extremely fragile, and this is my Achilles' heel. Attacking me now will have the highest probability of success."

Xiao Gao and Xiao Zhao listened with a sigh. Although everyone now says that Southeast Asia, especially Thailand, is an economic miracle and has maintained high economic growth.

But when Soros attacked the British pound, he utterly defeated Britain and gave the British people a kind of post-traumatic stress disorder—and that was Britain, a long-established capitalist power. When people mentioned Britain, they would say Britain and the United States, not the United States and Britain.

They simply couldn't believe that Thailand could withstand it.

This time, they're definitely going to bite off a chunk of fat.

However, they were just watching the show from the sidelines.

What is poison to one is honey to another. The severe blow to the Thai economy may not necessarily be a bad thing for China.

Look at Thailand's main export products, which one can't China produce?

As for cheap labor, China is cheaper.

If the investors of these factories withdraw from Thailand, they might just go directly to China.

Lu Xun was right; people's joys and sorrows are not shared.

Looking at the relaxed expressions of the two, Wang Xiao sighed inwardly.

The cost of ending a war can be far greater than the cost of starting it.

The latter are mostly decisions made by a minority, focusing on short-term interests, or even just on momentary emotional impulses.

But once a war begins, it is no longer under the control of the initiator; it will grow bigger and bigger like a snowball.

To end this, all the parties involved must compromise and reach an agreement; a third party may even be needed to mediate and act as a guarantor.

This economic crisis, which originated in Thailand, has had a wider impact and lasted longer than anyone imagined.

She looked up at the clock on the wall, clapped her hands, and said, "Alright, we should go."

After spending almost a month in Moscow, she really should leave.

The assistants and bodyguards immediately sprang into action, preparing to carry the luggage and head to the airport.

Only their boss, oh dear, Mr. Ivanov, remained sitting sullenly in his seat, motionless.

Wang Xiao didn't urge him, but just waved her hand and said, "I'm leaving now. Remember to go to work early."

She doesn't need anyone to take her.

Ivanov nearly burst into tears on the spot, looking up at her pitifully and asking, "Can't you just stay?"

You can delegate the task to someone else! Just pay more to have someone else do it!

Wang Xiao sighed: "It won't work. They have no experience in running an e-commerce website and don't know how to strike the right balance."

But this did not convince Ivanov, who felt even more aggrieved: "But you haven't done it either."

Wang Xiao laughed: "But I'm the boss. I can make the decision on the spot whether to go left or right."

Looking at Ivan, who looked pitiful like a left-behind child seeing his parents off to work in the city, Wang Xiao felt sorry for him having to endure the freezing cold for so long—spring always arrives late in Russia.

So she comforted him again, reaching out to hold his big head, softening her voice, and said, "Besides, if I stay any longer, how can your body handle running back and forth like this?"

He lived in the White House while she was away.

Since she arrived, the daily commute from the White House to the villa has taken more than three hours just to drive there and back.

Yes, yes, she could definitely stay in the city center, whether it's the container market or the Huaxia Commercial Street next to Red Square, both would be convenient.

But what about the red panda?

They had finally adapted to the villa environment, but suddenly moving to a crowded area in the city would be risky. First, they might run away and get lost. Second, the timid red pandas would easily experience stress when they saw so many people.

That would be too cruel for them.

Ivanov couldn't accept the idea of ​​having Wang Xiao move to the city center and leave the little panda behind.

All he wanted was for the red panda to relieve the king's tension and anxiety.

So he preferred to travel back and forth.

He now emphasizes, "It's okay, I was sleeping while I was in the car."

Wang Xiao shook her head firmly: "No, you're burning the candle at both ends; your body won't be able to handle it."

She rubbed her forehead against his, saying, "I'll wait until you're done with your work, then we'll go on vacation to South Africa. I'll take you to ride elephants and ostriches."

Ivanov nodded sullenly and asked her again, "Wait for me."

Wang Xiao smiled and promised, "I'll wait for you, I'll definitely wait for you. Okay, let's go to work, Ivan."

Ivanov almost rolled his eyes at her. How could he possibly go to work at this hour? He should at least go to the airport to see her off.

Wang Xiao reached out and pushed him: "Okay, okay, take me with you, let's go, let's go, let's go quickly!"

She didn't want to rush to catch a plane, to the point of a frantic sprint.

Upon arriving at the airport and entering the terminal, Wang Xiao suddenly sensed something was amiss: "Why are there so many people?"

It wasn't very popular to go to the far north to see snow in winter back then.

Winter is typically the off-season for tourism in Moscow, and the international airport terminal shouldn't be packed with so many typical foreign travelers.

Before Ivanov could answer, a person who hurriedly walked over chimed in, "These are all investments coming to Russia."

The speaker was their old acquaintance, Chubais, who looked much more radiant than when he last saw him at the shooting club. The Kremlin chief of staff now seemed to be in high spirits.

Although spring has not yet arrived in Moscow, the spring breeze in Chubais has already touched our faces.

This March was absolutely fantastic for him.

First, the day before yesterday, his superior, the president, finally announced his return to power, and the Kremlin has finally welcomed its true master.

From now on, Chubais will no longer need to suffer the torment of exercising his power in a dilemma, which is neither legitimate nor justified.

Secondly, or more importantly, Russia's economic situation has stabilized and is recovering.

Look at these investors who have come from all over the world. They are all optimistic about Russia's economic future, so they are eager to come and invest.

With the injection of these foreign investments, Russia's economy can finally see a glimmer of hope for a prosperous future.

He came to the airport today to personally welcome an important investor.

Good heavens, Russia's economic winter is finally coming to an end, and it is finally welcoming the spring it has been longing for.

The arms race is over, and 250 million people have been incorporated into the capitalist economic system. Take a deep breath; the air is filled with the scent of freedom and joy.

As Ivanov listened to his rambling, almost boastful explanation, he couldn't help but frown: "Anatole, be careful! Be careful! The excessive influx of hot money also means huge risks."

When the king was discussing the Thai economy with his bodyguards, he couldn't help but think of Russia.

He was thinking about how the government should respond if the Wall Street speculative capital represented by Soros was targeting Russia.

What's frightening is that he had no idea what to do, and he couldn't find any effective solutions.

Chubais had to make a pleading gesture: "Alright, alright, my dear Ivan, I will be vigilant, we will all be vigilant."

Good heavens, his young colleague was truly uninterested in finance. This tendency only intensified after the king took it upon himself to sell off government bonds on their behalf.

Chubais reassured him gently: "We need foreign investment to develop the economy. I guarantee that not a single ruble will be shortchanged from the funds allocated to rural areas for agricultural development and small and micro enterprises."

Ivanov also knew that he couldn't reverse this trend.

Look at those investors coming and going; they visit Red Square, the Kremlin, the Bolshoi Theatre, and then head into the newly established stock exchange. They pull out wads of cash to buy bonds and stocks.

They didn't even glance at the factories and refineries they had invested in before rashly handing over tens or even hundreds of millions of US dollars.

Ivanov originally thought that people from socialist countries who had never experienced capital markets, such as the people of China and post-dissolution Russia, would blindly flock to the financial markets.

In fact, what he saw and heard proved that all investors were pretty much the same under the influence of hot money.

Regardless of where they come from or what their past investment experience is, they will all fall into the same frenzy.

How could Ivanov stop them? As the country's deputy prime minister, how could he possibly stop a large influx of money into his country?

His intuition told him that this was just the beginning, and more funds would rush in eagerly.

He couldn't control those things, so he could only manage what he could: "Anatole, you must keep your word. Not a single ruble should be less than the budget allocated to me, or I will not let this go."

"Hey! I knew I wasn't mistaken!" Nemtsov ran over excitedly. "What are you all doing at the airport?"

He was preparing to travel to Siberia, where there were demonstration sites that had been selected as model sites for agricultural enterprises.

Chubais had argued with Nemtsov many times over rural reforms, and now, seeing him, he just chuckled: "Your Deputy Prime Minister is trying to secure funding for you, and if he says he's short even a ruble, he'll come after me. Good heavens, is this my business? How the money is spent is decided by the White House; it's not even within the Kremlin's purview."

Nemtsov didn't care who was in charge of this matter; he only cared that "it is absolutely essential. If water conservancy construction doesn't keep up, agriculture will definitely be doomed."

During his visit to township enterprises in the Yangtze River Delta region of China, he heard local farmers mention the amazing effect of digging rivers and canals on increasing agricultural productivity.

The Soviet Union failed to keep up with its water conservancy development back then. It's unbelievable that with such a vast territory and suitable arable land, it eventually had to import food.

Hearing his mutterings, Chubais couldn't help but complain: "The Soviet Union just doesn't do anything worthwhile, leaving a mess for us to clean up."

When there were collective farms, the Soviet Union could have organized farmers to build water conservancy projects, just like the production teams and communes in China.

Back then, we could do voluntary labor, but now we have to pay money. Where does the government get so much money?

Wang Xiao couldn't listen anymore and waved his hand, saying, "Sir, please be realistic. Water conservancy projects in the Yangtze River Delta region mainly take advantage of the winter off-season, when water levels drop, giving farmers time and making it suitable for water conservancy construction. But in Russia, winters are so long; once the ground freezes, how can we dig irrigation canals?"

From this perspective, the Soviet government had no choice but to use nuclear weapons to bomb the artificial lake.

Chubais was speechless, then turned to Ivanov: "How about we dig all the irrigation wells this year? God, Ivanov, you know we have so many places where we need to spend money. Digging artificial rivers would be too expensive."

Ivanov shook his head firmly: "No, for small, scattered plots of farmland, drilling wells can address irrigation issues specifically, and drip irrigation systems can be installed to improve water resource utilization efficiency and increase crop yields. But what good are those few irrigation wells for large tracts of farmland?"

He refused to back down an inch. "We've already discussed this issue. The arable land in the Far East is mainly distributed on the plains in the southern Amur Oblast, the southern Khabarovsk Krai, and the southern Primorsky Krai. These areas have numerous rivers and are fully equipped with the natural conditions to dig artificial canals for large-scale irrigation. We must get started this year."

Good heavens! If his high school geography teacher heard him ramble on like this, he might be moved to tears.

Back when he was studying geography, he was a complete academic failure; he couldn't even memorize the names of these states.

But now, the situation in these states has become a book in his mind, and he can directly refer to it whenever he needs something.

It's clear that people will never know their full potential unless they are pushed.

Chubais was in a hurry to greet his guests, and the king was standing next to Ivan. Given her sharp tongue, if she were to intervene, he would most likely be subjected to even more ridicule.

“Okay, okay.” He made a conciliatory gesture. “I will not interfere with the White House’s spending budget. I look forward to good luck for both of us.”

The assistant had already retrieved the boarding passes, and Ivanov was in a hurry to take Wang Xiao and the others to line up for security.

Before he left, he instructed Nemtsov: "When you go to the site, keep an eye on the local water conservancy projects for me. You know, Boris, there are too many incompetent officials in the Russian bureaucracy. I can't find anyone I can trust. You are the person I trust the most right now."

Nemtsov was so moved by what he said that he nodded in agreement: "Yes, this country needs young people. We should get rid of those drunken old guys in their positions."

Ivanov quickly covered his mouth, his eyes nearly popping out of their sockets: "God, please, please stop talking!"

What does "drunk old man" mean?

When it comes to the drunken old men sitting in high positions in Russian politics, if you ask anyone in the world, their first reaction will be His Excellency the President of the Kremlin.

Nemtsov looked completely innocent: "You know, Ivan, that's not what I meant. I still admire His Excellency the President."

The fact that he dared to undergo such a high-risk heart surgery shows that he is a brave person.

Courageous people are always worthy of respect.

Ivanov said helplessly, "It's all being heard by others, and it's hard not to have other associations. I beg you, Boris, my dear Boris, for the sake of our cause, for the future of Russia, please think before you speak. I cannot accept that you are being attacked to the point of being forced to stop what you are doing. Because I cannot wait, and Russia cannot wait either. For Russia's sake, I beg you."

Nemtsov, overwhelmed by his words, could only plead, "Alright, alright, my dear Ivan, I will be careful."

Like him, he eagerly anticipates a bright new tomorrow for Russia, a hopeful sunshine that will shine upon everyone on this land.

Wang Xiao was clearly much luckier than them.

Spring is still a long way off in Moscow, and the bright sunshine is also arriving late.

But South Africa is different. Even though it's already autumn in South Africa in March, the sun is still shining brightly enough to pack them up and sell them.

From March to May, she stayed in South Africa, working on building the supporting system for the shopping website and conducting trial operations, enjoying the sunshine every day.

It's truly baffling that South Africa, with its superior natural conditions, wouldn't become a world-renowned tourist destination if it could solve its serious public security problems and build the necessary infrastructure.

Its autumn is beautiful too, whether it's the bountiful vineyards of the Western Cape or the wild animals galloping under the sunset in Kruger National Park, it's all stunning, not to mention the mountains in autumn.

Ivanov didn't lose out this time; at least he got to see the beautiful autumn scenery of South Africa.

In early April, he served as the Russian Deputy Prime Minister, making advance visits to South Africa to discuss the export of Russian crude oil to South Africa.

He does want to export refined oil products, but South Africa has numerous refineries of all sizes established by Western companies, and they are more interested in obtaining cheap crude oil.

With the mindset that "it's okay even without fish and shrimp," the Russian government believed that talks were possible, so the two sides sat down for initial contact.

Midway through, Ivanov managed to squeeze in a day to at least tour South Africa before sadly flying back to Moscow to report on his work.

For such a major event to be finalized, the president must visit South Africa, the two heads of state must sit down together, and the two sides must sign a contract before the matter is considered closed.

However, Ivanov, the deputy prime minister, was in a terrible situation, as he couldn't get a vacation.

But even in his worst situation, he couldn't compare to the Thai national leader, who is now truly in a state of utter chaos.

Just as Wang Xiao had predicted, on March 3rd, as soon as the Thai government exposed its wounds, Wall Street speculative capital made a fierce comeback, desperately dumping large amounts of Thai baht.

The Thai financial market was hit by a tsunami, and the Thai baht could not withstand it and became increasingly weak.

Zhou Liang, eager to try, made three long-distance calls a day, urging his boss to make a move.

If you want to trade Thai baht, the earlier you act, the greater the potential profit and the lower the cost of establishing a core position.

If they act last, others will get the meat while they get the soup.

Wang Xiao found him too noisy: "Okay, okay, let's get started. Don't do spot trading, so we don't get targeted by the Bank of Thailand. Focus on forward trading."

Zhou Liang was overjoyed and immediately agreed.

Signing three-month forward selling contracts for Thai baht/US dollar with international investment banks. This allows for the creation of substantial risk exposure with minimal margin requirements and low funding costs.

An army is raised for a thousand days, but used for only one.

Since the 327 Treasury bond incident in 1995, apart from having his funds pass through several hands to participate in the privatization auction in Russia, the boss has not given him any specific tasks.

His anxiety was palpable.

Now, it's finally his turn to take the stage, and he's determined to get off to a great start.

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[Let me see], have a great weekend!