Chapter 349: Advance Planning

When it comes to Latin America, there are generally only a few impressions of it in the eyes of people outside of Latin America.

Samba dance, the Argentine prairie, the long and narrow Chile, the Amazon rainforest, the world's largest mixed-race people, Latin Americans, rich mineral resources, the horrific drug slums and so on.

Did you see it? Apart from geographical reasons, everything else is basically related to the colonizers.

In fact, apart from the differences in race and terrain, Latin America is not much different from Africa.

And in some ways, the situation in Latin America is actually worse than in Africa.

Because this place is too far from heaven, and too close to... America! Like their national debt crisis this time, it may have been Morgan and Rockefeller who secretly set a trap for them in the beginning.

Rothschild, who was lying in wait with the intention of making a fortune in Latin America.

The situation has developed to the point where a small financial crisis has occurred in the global banking industry, in fact specifically in Europe and the United States.

But on the other hand, it also seriously forced the sovereign countries in Latin America to devalue their currencies and cause social unrest.

It's familiar, right? Because this is usually when the Americans are about to go down.

Milo's meeting with his subordinates with the intention of seizing the copper and aluminum mining companies in Latin America is a microcosm of this incident.

However, unlike many companies and many people, in addition to these large-volume trading, these are relatively important mineral deposits in the world.

Milo also specifically set his sights on several metals that most people are not interested in now - lithium, nickel, cobalt, etc.

Latin America's lithium reserves account for 67% of the world's total, mainly concentrated in the "lithium triangle", where Bolivia, Argentina and Chile meet.

Nickel in Latin America is distributed in Brazil and Cuba.

The main use of nickel in the future will be as the positive electrode material for ternary lithium batteries.

The future use of lithium is in the manufacture of lithium batteries to support electric vehicles and renewable energy storage.

Milo's intentions were clear.

He is trying to plan for the world's future new energy sources, the Atacama Salt Lake in Chile and the Umbre Muerto Salt Lake in Argentina, the two largest lithium producing areas in the world.

There is also the Caracas nickel mine in Brazil and so on, which are all things he wants.

Not to mention now in 1998, it is too early for Milo to develop new energy.

But in fact, new energy is such a huge industry that it can influence the whole world in the future.

This is because the two major countries, the United States and China, began to make their plans in the 1990s.

Just like the emergence of smartphones, the planning began as early as the 1980s after the GSM mobile phone was invented in the laboratory.

A large, profitable industry doesn't just appear out of thin air.

They often receive support from countries or companies very early on, and then have an impact on the world many years later.

Anyway, it’s just about stockpiling some minerals. Even if new energy sources don’t appear in the future, these minerals are still necessary and can be easily sold.

And Milo is sure that even if Americans do not develop new energy.

The Chinese can do it too.

The reason is very simple. If China wants to upgrade its industry in the future, it will inevitably touch the crown product of industry and industry - automobiles.

But this is easier said than done.

The three most important things in a fuel vehicle are the engine, the gearbox and the chassis.

There is no standard for the latter. Everyone is different. There are ten thousand different requirements and feelings about the chassis.

But the engine and gearbox are truly the crystallization of industrial technology, the embodiment of high technology, and a super fortress of patents.

Whether it is Japan in Asia, Germany in Europe, or the United States, they have accumulated countless patents in gearboxes and engines.

It even removed countless patent walls that were difficult or impossible to circumvent.

This makes it difficult for emerging countries to develop the crown of industry, that is, automobile production and manufacturing.

Unless they have a way to bypass the countless patent traps set up by all the leading countries, such as developing an unprecedented and completely different engine technology.

If we cannot do this, we will not be able to integrate into the international community.

Then they can only honestly pay patent fees to Germany and Japan, the two major automobile producing countries.

Even then, there was no hope of surpassing them.

Then some people may say, why not just not produce cars?

There are so many industries, why do we have to focus on automobiles?

However, the fact is that the automobile industry is the most closely related to the people in the industry, but it is also the most expensive industrial product that ordinary people can afford.

Let’s put it this way, Japan and Germany.

The related industrial chain of their automobile industry supports the superior life of millions of workers and their families in their country, even though those engaged in this industry in their country are middle-class families.

Millions or even thousands of jobs, hundreds of thousands or even millions of scientific researchers... and they are all high-paying, or relatively high-paying industries.

Which ambitious industrial country would not drool at this? Or would it want to continue to produce hundreds of billions of socks and clothes every year in exchange for hundreds of thousands or millions of imported cars? So in the case of the patent barriers of fuel engines and gearboxes that cannot be avoided.

The United States can grab it, so it is not necessarily necessary to research new energy vehicles in the future.

But as long as China has a little ambition, it is absolutely impossible for it not to develop.

Because they cannot get around the patent wall and are eyeing the automotive industry, the best way is to find another way - electric cars.

It immediately avoided the patent walls of Germany and Japan.

Therefore, even if Tesla had not appeared, China would still develop new energy.

That has something to do with their national foundation.

It’s just that Tesla just happened to seize the opportunity and became the catfish that was let in.

The United States saw that China had actually succeeded in doing so, and it was able to avoid paying patent fees to Germany and Japan - the American automobile industry is actually now lagging behind.

So from the perspective of national policy and interests, the United States is also destined to enter this track.

More than ten years in advance, we planned to prepare the necessary raw materials such as nickel and lithium.

Even if I don’t get involved in new energy in the future, I can still make money and have a say with these basic things.

Naturally, this video conference ended with Milo's ambitions for nickel and lithium minerals in Latin America.

on the other hand.

This afternoon, after the stock market closed.

Evelyn Rothschild dragged his tired body back to the family and went straight to find Jacob Rothschild, Elroy Rothschild and others who were gathered there.

Seeing Evelyn Rothschild come back, everyone who was talking stopped immediately.

"Evelyn, how's the bank doing?"

Liszt Rothschild, who came from Vienna, Austria, immediately asked about the situation after Evelyne Rothschild sat down and drank a sip of water.

Facing everyone's gaze, Evelyn Rothschild sighed and said bitterly:

"The situation is terrible. Our bank's debt situation has long been publicized. Depositors and investors have completely lost confidence in our bank. Our stabilization measures have completely failed. Now every branch is crowded with people coming to withdraw money."

“How much deposit has been withdrawn?”

Harry Rothschild from Switzerland asked immediately.

"I have compiled the data to make it more intuitive. Let's take a look."

Just as he finished speaking, Evelyn Rothschild suddenly realized that there were so many people here, and it would be a waste of time to look at them one by one.

He decisively retracted his hand holding the notebook and said, "Forget it, I'll just read it all out again so everyone can listen together."

Everyone immediately focused their attention and looked at him intently.

Evelyn Rothschild opened her notebook and read aloud:

"The bank now has total assets of £148 billion, and depositors' total deposits of £142.12 billion. Since August 6, £15.5 billion of deposits have been lost, and the company's market value has fallen from £13.5 billion nine days ago to more than £9.92 billion."

"Our holdings of Latin American sovereign debt now account for 24.84 percent of the bank's total assets."

"If we add the $51.94 billion of debt to Latin American companies that has now been classified as a major risk asset, our bank's risky assets already account for as much as 47.8%!"

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"Our bank has now been listed by many institutions as the bank with the highest risk in the UK banking industry..."

"As for the bank's liquidity..."

Speaking of this, Evelyn Rothschild's face turned very ugly. This was a number he didn't want to face.

One hundred and twenty-three hundred and ten million pounds.

When this number came out, everyone couldn't help but frown.

Although it seems a lot, there is still over ten billion pounds.

There are not many people in the world who have more than 10 billion pounds in liquid funds.

But it depends on the situation.

More than 10 billion pounds if owned by an individual or a company.

Whether it is a company or an individual, they are naturally rich and powerful.

But this money is now the remaining liquidity of the main British branch of their Rothschild family.

Especially now when there is a collective banking crisis in Europe and the United States.

These more than 10 billion pounds are not enough.

According to the current data Evelyn Rothschild just mentioned, the total assets of all the banks owned by the British Rothschild family across Europe now amount to 148 billion pounds.

However, the liquid funds only amount to 12.31 billion pounds, which means that the liquid funds ratio is less than 8%, which is undoubtedly an extremely low figure.

Generally speaking, for large commercial banks in Europe and the United States, the proportion of liquid funds to total bank assets should be maintained between 10% and 15%. The specific amount varies from bank to bank.

Generally speaking, commercial banks' liquidity holdings should comply with three principles.

First, the principle of moderate total amount of cash asset management.

This means that the total amount of a bank's cash assets must be maintained at an appropriate size.

This appropriate scale refers to the amount of cash assets when the opportunity cost of the bank to maintain cash assets is the lowest, while ensuring the liquidity needs of the bank's business operations, which is determined by the functions and characteristics of the bank's cash assets.

The principle of moderate total amount is also the most important principle for commercial banks' cash asset management.

Second, the principle of timely adjustment of cash assets.

This means that banks must promptly adjust their cash shortage positions based on changes in cash flows during the business process to ensure that the size of cash assets is appropriate.

Third, the principle of security.

Commercial banks' cash assets mainly consist of their deposits and cash reserves in the central bank and interbank banks.

Among them, cash on hand is the necessary payment working capital in the business operations of commercial banks, and it is distributed in various business outlets of the bank.

In the management of cash assets, especially cash on hand, banks must establish sound security systems and strictly follow business operating procedures to ensure the safety of funds.

To summarize the three principles, it is to make full use of bank funds while ensuring the safety of bank operations as much as possible!

If a bank has too much liquidity, its costs will be very high at the end of the year when savings interest rates are extremely high. It is safe, but if it is not managed well, it can easily lead to losses for the bank.

Families like the Rothschild family, which have been engaged in the banking industry for hundreds of years, undoubtedly have extensive experience in running banks, so they have always pursued high turnover and high profits.

In addition, the Rothschild family is a large and powerful family, so it is easier for them to mobilize funds. Therefore, the liquidity ratio of its banks is kept below 10%.

Under normal circumstances, it would not matter if it was less than 10%. With the reputation of the Rothschild family consortium, it would be easy to turn over funds.

But at this moment, its subsidiaries are still facing the dilemma of continuous capital outflow, and other banks are also stuck in a quagmire, and they will definitely not turn to Rothschild's bank for capital turnover.

Originally, the Rothschild family had another financial pillar - the French Rothschild family.

But Rothschild of France suffered a severe setback at the hands of the Russians two years ago.

Because the French have always felt superior to the Russians.

So two years ago, the people who were most enthusiastic about speculating on Russian currency and bonds were French bankers.

Rothschild France is one of them.

But who could have thought that the Russians didn't even care about their dignity.

Just deny it.

If you have the guts, go to his house and steal the missiles!

Therefore, among all the international speculators, the French suffered the most because they invested the most capital.

The French Rothschild was also severely damaged as a result and has not recovered yet, making it difficult for it to help the British main branch.

There is only one way out now, and that is for them to find a solution themselves.

There are two simplest and most effective ways.

First, let their banks sell off current assets, recover loans as much as possible, and recoup funds.

Second, the Rothschild family mobilized the entire family and consortium's liquidity to inject it into the banks in the UK to prevent Rothschild's UK banks from being drained of funds by depositors.

Jacob Rothschild summoned the leaders of other branches except the American branch here for these two purposes.

Let's work together to overcome the difficulties! Seeing the ugly faces of the crowd, Jacob Rothschild, who was sitting at the head, finally spoke.

"Everyone is aware of the situation. Now it has reached an extremely dangerous moment. The core pillar of our family is in the UK, and we must do our best to protect it!"

"In the past nine days, our bank has lost about 10 billion pounds. Although it is a lot, we must also realize that this is already a very good situation. I know Evelyn has spent a lot of energy to stabilize those big customers."

"It can be said that 80% of the assets that are being lost now come from ordinary depositors, otherwise it wouldn't be so low!"

"But unfortunately, what happened in Latin America in the past few days is something none of us want to see. A sovereign debt crisis has broken out in Latin America."

"This means that starting today, the crisis will be escalated several notches!"

(End of this chapter)