Chapter 440 Closing the Door to Beat the Dog: People are the Biggest Variable

Zhou Liang's plan was quite good, and not long after he stepped onto the field, the Thai baht couldn't hold on, and the exchange rate plummeted to 26.70 baht to 1 US dollar.

Just as the short sellers were jubilant and preparing to reap the rewards, the Bank of Thailand launched a fierce counterattack.

On May 14, the Thai government began to dig into its coffers, using more than $6 billion to buy back the Thai baht.

On May 15, the Bank of Thailand took action again, introducing a new policy that prohibits local banks from lending Thai baht to foreign institutions represented by George Soros, and directly raised the overnight lending rate from 10% to 1000%.

On May 16, the Thai government sought help from its allies and neighboring countries. Singapore, Malaysia, and Hong Kong banks, feeling the pinch, stepped in and used their own US dollars to buy Thai baht.

After a series of decisive actions, including a massive $15 billion investment, the Thai baht finally stopped its decline.

By May 20th, its exchange rate had reached a new high, with one US dollar equaling 25.20 Thai baht.

It's quite a coincidence that it's also May 20th, a day that perfectly embodies the sentimental "I love you."

After this wave, the market trend did indeed favor Thailand, as the government repelled the second round of attacks from international short sellers and defended the Thai baht's exchange rate.

Caught off guard, Soros suffered a loss of approximately $300 million due to the sharp rise in interbank lending rates.

In the first wave, he lost $5 million.

In the second wave, he suffered another huge loss of 300 million US dollars.

When Zhou Liang saw the new exchange rate of the Thai baht, he felt as if his world would never see the light of day again.

It's all over. If he keeps losing money like this, everything will be dark for him, and he'll have no future left.

He couldn't help but regret why he had to rush his boss. If his boss wasn't in a hurry to get involved, he could have just waited.

He has such a foul mouth!

But things had already come to this point, and he couldn't keep it from his boss—he had to be able to keep it a secret even if he wanted to!

He could only pitifully make an international long-distance call, preparing to apologize to his boss.

Wang Xiao was quite surprised to hear this, and couldn't help but sigh: Southeast Asia is indeed a remarkable region, worthy of being called an Asian miracle. Thailand's economic rise is also a testament to its resilience.

Zhou Liang was a bit lost: "Boss, what's our next step?"

The fighting has been going on since January, and Thailand has been refusing to admit defeat. Now that its allies have joined the fray, if the fighting continues, it will likely suffer even greater losses.

Wang Xiao said casually, "There's nothing we can do. We'll keep fighting. The battle isn't over yet."

Zhou Liang had to remind his wealthy boss: "Thailand signed currency stabilization agreements with Australia, Japan, Indonesia, Malaysia, the Philippines, Singapore, and Hong Kong last year. When one country is in trouble, all countries come to its aid. If all these countries and regions join in, they are not to be trifled with."

As it turns out, this time, Singapore, Hong Kong, and other countries and regions did not stand idly by; they provided substantial financial support.

But Wang Xiao didn't take it seriously: "If this were an agreement between eight provinces, then there would be some merit. But with eight countries and regions, the effect wouldn't be so good. No country would empty its coffers for another; each has its own difficulties. If they really did, who would bail them out?"

Zhou Liang confirmed again: "Continue?"

Wang Xiao gave an affirmative answer: "Yes, the money has arrived in President Tang's account, you should continue to follow up."

All-in is all-in; once on the battlefield, you must give it your all.

After hanging up the phone, Wang Xiao thought for a moment and then made an international call to Secretary Fang of Jiangdong Province.

After a brief exchange of pleasantries, she got straight to the point: "Secretary, if Jiangdong is interested, they can go to Thailand now to attract investment. Foreign capital is withdrawing from Thailand, and most of them have to find other places to operate."

After Soros defeated the British pound and then Mexico, the whole world is watching his every move.

So when Wang Xiao mentioned Thailand, Secretary Fang immediately reacted: "The Thai baht can't hold? Where did you get that information?"

"It's uncertain!" Wang Xiao said without blinking. "The information and analysis I've gathered so far all suggest that Thailand can't withstand this. The country is only so big, its size is limited, and it doesn't possess any irreplaceable assets. Relying on labor-intensive industries, its minimum wage last year was already 148.64 baht per day, equivalent to 51.72 yuan in Chinese currency, two to three times that of neighboring countries, so it no longer has the advantage of cheap labor. Moreover, 79.55% of its workforce has less than a primary school education, so it lacks the talent base for economic restructuring and industrial upgrading."

To put it bluntly, its current status as one of the Four Asian Tigers is very weak; if it's pricked any further, the bubble will burst.

Wang Xiao laughed and said, "I didn't spend the Chinese New Year in China this year, and the CPPCC meeting didn't take place either. Let's consider this my proposal for this year: see if it can help absorb the capital withdrawing from Thailand?"

Secretary Fang laughed and said, "I was planning to praise you properly at this year's CPPCC meeting. I even had the speech written, but you can't come back. Okay, Thailand, right? I'll arrange for someone to go there as soon as possible."

That's how investment attraction works; if you seize the opportunity, you can attract people.

After hanging up the phone, Wang Xiao dialed Xiao Zhou's number again and, following the same pattern, embellished his theory of being bearish on the Thai baht, reminding Jiangbei Province that if they were interested, they should take the opportunity to attract investment to Thailand.

To avoid arriving too late and finding that everyone else has already gone elsewhere, leaving you with nothing to regret.

After she finished her campaign, she hung up the phone, took a deep breath, and dialed one last number.

This time, she called Ivanov: "Do you have any economic advisors here? If so, send someone to Thailand so that he (or she) can personally experience the entire process of the financial crisis."

Even if someone teaches someone else, it may take a lifetime to teach them to learn.

Practice teaches people; they learn it in no time.

Although Ivanov didn't understand her intentions, he still habitually agreed to her request: "Okay, I'll send someone over."

After hanging up the phone, Wang Xiao went out of the room to greet the guests as if nothing had happened.

She bought a small farm in Cape Town, the kind with its own estate, which was transferred to her by a white farmer, and it's very nicely maintained.

Inside the living room, Deputy Mayor Delamini was listening attentively to the opinions of the Chinese guests, nodding as he listened, and even taking out a notebook to write down each word.

Who are the customers of Huaxia? They are the website's employees.

Since they've already set up an online shopping website in South Africa, they should naturally bring their technical team with them.

When Wang Xiao saw that Deputy Mayor Delamini had stopped writing, he smiled and apologized to him, "Sorry, the phone call took a while."

Dlamini immediately said it was no problem, and emphasized quite seriously: "You have given us a lot of good suggestions, which are very good and very meaningful."

When Wang Xiao told him last year that he should vigorously develop the tourism industry, he really listened to her.

However, there are many difficulties to overcome.

The website's accountant repeatedly emphasized: "Everything else is fine. The transportation here is convenient, there are many good restaurants that aren't too expensive, and the scenery is beautiful; the only problem is the security, which is really unbearable."

He took his camera with him last Sunday, wanting to take more photos of the tickets and send them back to his family in China. But while he was walking down the street, his camera was snatched away.

Dlamini gave a wry smile: "Security is a big problem, and it's giving us a real headache right now."

If the economy doesn't improve and unemployment increases, public safety will suffer.

Wang Xiao actively promoted the idea: "I think South Africa should develop its tourism industry first. Once the industry develops and more people are employed, the security situation will naturally improve. Whether it's the chicken or the egg, we should start with one."

Dlamini was originally an engineer, but he was forced into the position of deputy mayor and often had to work as a firefighter, constantly running around to various places to coordinate conflicts.

He seemed a little bewildered by Wang Xiao's suggestion that the tourism industry should be developed first.

South Africa has had a tourism industry for a long time, but he really didn't know how to develop and promote it.

Do we need to advertise? Advertise all over the world? How much would that cost?

The government is currently facing a tight budget and simply cannot afford this expense.

Wang Xiao smiled broadly: "The rich have their way of living, and the poor have theirs. To advertise all over the world, how much wealth would you need? My idea is this: create a website for South Africa, specifically to promote the beautiful scenery and various flora and fauna of South Africa."

She explained, "Everyone probably has the idea that South Africa is beautiful, but they don't know exactly how beautiful it is or what fun and interesting places it has. With this website, it's like having a free, constantly updated billboard that lets people learn about South Africa, thereby generating interest and making them want to travel there."

As for who built this website? Isn't there an internet company right here?

Wang Xiao generously stated, "The company will charge the most favorable fee for the initial website setup, and all subsequent maintenance will be free."

How will that company make money? They can't just work for free, can they?

It relies on links, specifically links to the I buy website.

Oh, by the way, I buy is the name of the shopping website they created in South Africa.

Wang Xiao explained, "We're going to add a link to the South African specialty products section to attract more customers to South Africa through online shopping."

Deputy Mayor Dlamini felt his brain was a bit overwhelmed. After trying to understand for a while, he hesitated before asking, "You mean we're going to build a website?"

After saying that, he seemed to realize the key point: "So how do we get people to see this website? I mean, there's so much stuff on the internet."

“Just buy ad space on Google search engine,” Wang Xiao said without hesitation.

Yes, yes, it can indeed allow internet companies to create their own search engine, which is not a difficult task for programmers.

However, in Europe and the United States, the Google search engine, launched last year, already has a certain market share and audience.

If you make one yourself now, who will care?

If Wang Xiao had that time, he might as well have the internet company create a Chinese version of the search engine and seize the domestic market first.

As for South Africa, it's better to stick with what you know and leverage Google's market to increase the visibility of the South African website.

Dlamini was constantly worried that the government didn't have enough money, and his head was full of accounts.

So, after a brief moment of excitement, he immediately became alert: "Then, how do we update the website? This is a huge expense! We can't just keep using the same few pictures. We need to constantly update the website with pictures of the changing scenery in different places throughout the year."

Strictly speaking, if you want to make this website successful, it will definitely need a large support team, which also means that it can provide a lot of jobs.

But these jobs cost money; you have to pay to hire people to do them.

Wang Xiao smiled and said, "This should be a great undertaking for all the people of South Africa and all tourists visiting South Africa. The website will have two modes: registered members and tourists. Tourists can upload pictures and communicate with other netizens in the forum, which is also a chat room. Registered members can have their own exclusive blog, where they can upload photos they have taken and record their travel experiences."

Dlamini was not impressed, because people cannot imagine things they do not understand.

He was puzzled by only one thing: "Why do people upload their photos and write reviews on this website?"

Isn't it troublesome? He has hated writing essays since he was a child.

What exactly motivates everyone to do this? Is it out of love for South Africa?

No, no, no, he didn't believe there could be so much love that it would lead to working for free.

Wang Xiao was utterly speechless.

She looked intently at the bewildered Delamini: "Have you ever met someone who self-publishes a book? They just want to share their words and photos with more people. The praise and recognition from others is a huge form of social validation. This pleasure is even stronger when the other person is a stranger online, because you know that the other person is not doing it out of personal favors."

Dlamini was still confused: "Is that so?"

Wang Xiao had no choice but to patiently explain: "It's like you're going out alone without any subordinates, and nobody knows who you are. But you hear the citizens of Cape Town talking about how our Mr. Dlamini has done a great job and done a lot of practical things for us."

Dlamini's skin was a very dark color, so you couldn't even tell he was blushing. Only his shy, evasive expression betrayed his inner excitement.

Wang Xiao laughed: "It's a similar feeling when your photos and travelogues are praised online."

She believes many South Africans will join in, especially the disillusioned white middle class in South Africa. They need more recognition online to compensate for their disillusionment in real life.

Dlamini reluctantly accepted this explanation, nodding and saying, "Okay, I understand. I'll report this plan to you."

Wang Xiao smiled and said, "Then I'll wait for your good news. Please make a decision as soon as possible. We need to complete all the preparations before the peak tourist season arrives."

Actually, whether the South African government agrees to the creation of this website is not the most important thing for Wang Xiao.

It can't stop her from doing it even if it disagrees; it's just that with official authorization, it sounds more legitimate.

Even if she disagrees, she will continue. A successful website generates a tremendous amount of traffic, and that traffic itself can be monetized.

Still not satisfied, Dlamini checked his notes again: "Anything else? About promoting tourism?"

“Another issue is flights,” Wang Xiao said with a smile. “For most people, one of the biggest expenses when traveling abroad is the round-trip fare. Therefore, South Africa needs more affordable flights.”

She launched into a sales pitch: "In this regard, I recommend Aeroflot. Compared to other international flights, Aeroflot is really cheap."

Even as he was seeing Dlamini off, Wang Xiao earnestly emphasized to him, "As long as we persevere and develop South Africa's tourism industry, I guarantee that in just 20 years, tourism alone will become a pillar industry for South Africa."

Such a beautiful place, with plenty of cheap food. If only the supporting facilities were a little better and the security was a bit better, any Chinese street urchin could turn it into a popular tourist destination.

Keep up the good work! She's even thinking of making this her regular vacation spot.

The bodyguard accompanied her to see the guests out, and he was particularly impressed by his boss's relaxed demeanor.

It's true, even though they couldn't see each other through the phone line, they could imagine how terrified and uneasy Zhou Liang must be on the other end.

As a result, the price of the Thai baht was driven up again, and the short sellers were all saying they were trapped. The boss didn't care at all and turned around to develop other businesses.

Looking at the excessively blue sky, Wang Xiao turned his head and laughed, "The Thai government's methods are nothing compared to this. So what if they don't let banks lend money out? There are plenty of financial derivatives transactions, such as currency swaps, foreign exchange swaps, foreign exchange forwards, option interest rates, etc. Their methods are outdated; this is a kind of dimensional reduction attack."

When the United States invaded Iraq, it used the same standards it had used to deal with the Soviet Union and the entire Eastern European steel torrent. It was a classic case of using a sledgehammer to crack a nut, which is why it produced an effect that seemed like divine intervention.

The situation is probably similar now that Soros is dealing with Thai finance.

To put it bluntly, Thailand developed too well and too fast in previous years, and became arrogant. It rashly opened up its financial market without realizing, or rather, without taking care of the fact that it had its doors wide open and was completely unable to fight back.

After sighing and reflecting for a while, Wang Xiao happily ran off to watch people making carvings from ostrich eggs.

However, as it turns out, all the hindsight-based financial investment analyses were nothing but self-righteous nonsense.

Once you're on the battlefield, the situation is always changing rapidly.

Because the opponent you are fighting is a human, and humans are the biggest variable.

On June 2nd, Wang Xiao had just finished breakfast and hadn't been busy for long when the phone rang.

Zhou Liang on the other end was completely disoriented, and when he spoke, his voice was almost choked with tears: "Boss, we're doomed!"

Wang Xiao immediately rebuked the other party: "You're not finished, you'll never be finished. You can be reincarnated even if you die!"

They really don't know how to say auspicious things!

Zhou Liang had no time to care about auspicious sayings. As a party member who joined the party in college, he was even less likely to believe in reincarnation.

All he knew was that it was getting dark in Bangkok, and they had all been dragged into hell!

"The central bank of Thailand has issued a notice that, effective immediately, all financial institutions in Thailand must cease all derivative transactions, including currency swaps, foreign exchange forwards, and interest rate options."

Zhou Liang's voice was hoarse. "Even bribing banks to lend Thai baht privately is not allowed, because the Bank of Thailand requires domestic institutions to report on foreign exchange transactions in detail every day and retain relevant foreign exchange transaction documents."

What does this mean? It means that Thailand has closed the door, trapping all their short sellers inside!

The Thai government's ban in May was largely ignored by short sellers, who continued to deploy troops to attack the Thai baht.

Because that ban mainly targets the Thai baht lending in the spot market.

International finance has long since evolved into the era of derivatives. The financial derivatives market, especially the offshore non-deliverable forward foreign exchange market, is the main road for speculators to acquire Thai baht positions and conduct short selling operations.

This huge, hidden backdoor allows investors to easily and cleverly "synthesize" short positions in the Thai baht through currency swaps and forward contracts.

Now that path is blocked, short sellers can no longer obtain Thai baht in the market.

This freezing mechanism completely locks up the liquidity of the Thai baht within Thailand.

How can investors who have established huge short positions in Thai baht close their positions?

Thai baht is no longer available on the market. If they want to repay the Thai baht they lent out, they can only do so by buying it back at an extremely high price.

This is what is known as a "short squeeze," a classic case of "unleashing the dogs from behind closed doors." The short sellers won't be able to leave the Thai financial market until they've been torn to shreds and left bleeding.

Because no matter what you say, Thailand is still Thailand's own territory.

Wang Xiao gasped. Her first reaction wasn't that her $1 billion investment in Thailand was going to go down the drain, but rather that she was surprised that Thailand had such backbone.

What kind of behavior is this, closing the door? It's a classic case of flipping the table and quitting.

She had thought that only a military superpower like Russia would resort to flipping the table when cornered – meaning, "Let's all stop playing this game."

Who would have thought that even a clay figure could have a bit of a stubborn streak? When pushed too far, even a rabbit can bite.

For a moment, Wang Xiao's mind was racing, so fast that it was practically blank.

She took a deep breath and made a quick decision: "I'll come to Bangkok."

She needed to make comprehensive judgments on the battlefield in order to analyze what she should do next.

"Book your flight to Bangkok immediately and depart as quickly as possible."

Wang Xiao gave instructions to his assistant.

She instinctively walked to the window and gazed at the scenery outside.

In June, Cape Town still boasts blue skies and green trees, and in the distance, large fields of flowers can be seen.

A female worker who was busy in the courtyard suddenly looked up and exclaimed, "It's snowing."

Wang Xiao subconsciously looked up, and sure enough, what was drifting and falling in large flakes from the sky was snow.

June is winter in South Africa.

From Cape Town to Bangkok, there was a connecting flight, and the time spent in the air alone was nearly 20 hours. Adding the time Wang Xiao spent buying the ticket and waiting to board, a full 24 hours had passed.

These 24 hours were the longest 24 hours of Zhou Liang's life, 24 hours of continuous Ice Bucket Challenge, and 24 hours of being roasted in the Flaming Mountains.

Countless times he broke down, and could only pace around the room like a trapped beast, refusing to go near the window—he was afraid that if he got too emotional, he would jump out.

He picked up his boss at the airport, and his eyes welled up with tears; he almost burst into tears on the spot: "Boss."

Wang Xiao was startled. Good heavens! Had he run into a vampire? This unlucky kid looked like he'd been drained of all his energy, and he was even staggering as he walked.

"Don't worry, don't worry, I'm here, I'm here." Wang Xiao quickly comforted him, worried that the battle wasn't over yet and all the generals he could bring out for practical experience had been scared to death.

Where can she find someone to take over his job in such a short time?

The person next to him chimed in, trying to comfort him: "That's right, Xiao Zhou, the boss is here, what are you afraid of?"

Wang Xiao recognized the person only after hearing the voice clearly; it was Tang Yicheng.

This guy's sunbathing is really intense; he's no longer wheat-colored, but has a deep tan. And when he smiles, his teeth are so prominent they're almost blinding.

Wang Xiao laughed instantly, his tone becoming more relaxed as he teased Zhou Liang, "With your Brother Tang here, why did you call me over? Aren't you just ignoring a ready-made Buddha?"

Tang Yicheng looked completely bewildered. Why should he worship him? He didn't know anything about him.

He had just sold his Hong Kong property and handed over the money to Zhou Liang, and then, purely out of a desire to see more drama, he went to Bangkok to watch the spectacle.

As a result, he had barely arrived in Bangkok and hadn't even had a chance to explore it properly when the June 2 tragedy occurred, leaving short sellers trapped.

He even suspected that he hadn't checked the almanac before going out, and as a result, he brought bad luck with him.

Of course, he absolutely couldn't mention the last point. No one in business is immune to superstition; which of Hong Kong's wealthiest families doesn't have a patron saint?

Now, Tang Yicheng quickly distanced himself: "Boss, don't flatter me. How would I know what to do? I'm a rough man, I don't understand these things."

Wang Xiao rolled her eyes at him: "Are you hiding something? Zhang Junfei is your man, and Xiao Zhou is Zhang Junfei's man. You don't even teach your own people."

Tang Yicheng truly felt more wronged than Dou E, and could only beg for mercy: "Boss, I really didn't know, I don't understand finance."

Xiao Gao and Xiao Zhao were both numb. When your boss has such a strong heart, you start to doubt whether you're living in a giant Truman Show, and everything around you feels unreal.

Such a large investment! Although they didn't know the exact amount, it couldn't possibly be a small sum if it could drive Manager Zhou almost crazy.

Now all the short sellers are trapped in the Thai baht. Boss, how come this big short seller is still acting like nothing happened? He's busy joking around with people!

After leaving the airport, the group did not get into a car, but instead boarded a helicopter, which they called an airbus.

Yes, this is Bangkok, Thailand in June 1997. It was a typical middle-income country, just one step away from becoming a developed country.

The country's road infrastructure development has not kept pace with the number of cars owned by its residents. It is not uncommon for middle-class families here to own two or three cars each.

What do you do when there are many cars and narrow roads, and you encounter a major traffic jam? Ordinary people can only wait patiently, but there are always some people who are unwilling to wait and prefer to fly over other people's heads.

Air buses were thus born.

Yes, helicopter tickets are indeed very expensive, but rich people don't care.

Rich people spend their time making more money, not sitting in their cars staring blankly at endless traffic jams.

Therefore, the airbus is very popular and needs to be booked in advance.

Although Zhou Liang was in a panic, he still knew that he was entertaining a big boss, so he made all the necessary arrangements in advance.

Xiao Gao and Xiao Zhao were all exclaiming in amazement, "Wow, Thailand is so developed!"

At this moment, it was already dark, and the city was brightly lit.

Don't underestimate this point; a stable power supply demonstrates the strength of a country's power infrastructure and facilities.

Looking at the world, there are far fewer countries that can do this than you might imagine.

However, they couldn't afford to marvel at the dazzling lights of Thailand at night; like Zhou Liang, everyone was on tenterhooks!

The helicopter finally arrived in the city center. After completing the hotel check-in procedures and entering the luxury suite, Wang Xiao casually remarked, "What's the rush? Do you really think Thailand would dare to overturn the table?"

While transiting in Doha, she saw an advertisement at the airport and suddenly realized something: Thailand wouldn't actually flip the table.

It is not Russia; the situations in the two countries are completely different.

Thailand lacks a strong military and defense capabilities, which means it lacks the confidence to escalate a financial war into a military war.

Moreover, its economic development is heavily reliant on foreign investment. As an export-oriented country, how can it possibly shut itself off and survive?

It cannot be self-sufficient.

After the initial outrage subsides, all sorts of problems will arise. How will the Thai government respond?

It had no choice but to let go.

Wang Xiao clapped his hands: "Alright, the most crucial point is that we've decided that the Thai government won't be able to hold out until the end, and this ban will definitely be abolished in the end."

Zhou Liang opened his mouth again and again, a thousand words were on the tip of his tongue, but in the end only one sentence remained: "When will it be abandoned?"

This ban is like a rope, a rope wrapped around their necks.

What's the point of hanging them all and then letting the rope down?

Wang Xiao smiled and said meaningfully, "This is what you should be doing: making the Thai government unable to hold on any longer and giving up as soon as possible."

Zhou Liang looked bewildered again. He was a financial analyst, not a government relations professional.

Wang Xiao sighed and pointed at Tang Yicheng, saying, "You should at least teach him a lesson."

Tang Yicheng thought to himself, "What the hell am I supposed to teach? I don't even know what's going on myself!"

Then, Wang Xiao prompted him with the next question: "What should we do when two armies are at war and we have no way to increase our strength?"

Tang Yicheng's eyes lit up instantly. That's right, weaken the opponent's strength!

As the enemy weakens, doesn't that mean I become stronger?

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[Let me see] Good morning!