For example, if $100 can be exchanged for 700 Hong Kong dollars, but if someone artificially inflates the value of the Hong Kong dollar, then $100 can only be exchanged for 600 Hong Kong dollars.
He made a profit of HK$100 from the difference.
However, if he raises the exchange rate from 100:700 to 100:600, the Hong Kong dollar will have more room to fall. Then he buys the Hong Kong dollar at the bottom at 100:900, creating a difference of 300 yuan.
By doing this back and forth, they made a profit of 400 yuan by raising and lowering the price.
In fact, it's not just Guo Bingxiang; retail investors in Hong Kong are also familiar with Soros's logic. The patterns in the stock market are easy to find.
Once they enter the market, retail investors often find it difficult to make rational judgments while following the trend.
When to release, when to withdraw, when to follow the trend, and when to lie low and wait for the right opportunity.
There's a lot to learn about this.
The fact that Soros was able to attack other countries' financial currencies several times and succeed on each occasion demonstrates that his professional team has a keen eye for opportunity.
They are always able to accurately grasp the key moments of entering and exiting the game.
"We certainly can't accurately grasp Soros's thoughts, but..."
Zhou Quan reminded Guo Bingxiang, "This morning, the Hong Kong Monetary Authority announced on its official website and television that it will adjust the interbank lending rate."
How to adjust it?
Zhou Quan explained, "The interbank lending rate will be reduced to 2.1%."
This is already higher than the usual price. However, due to the impact of the Southeast Asian financial crisis on Hong Kong, Hong Kong has taken many precautions to prevent third-party institutions from shorting the Hong Kong dollar using the same methods.
Raising interbank lending rates is one such method.
Now that the Hong Kong Monetary Authority has lowered the interbank lending rate, retail investors and third-party institutions will take this opportunity to buy heavily.
The current market situation is that the bulls have the upper hand, so many financial tycoons, foundations and investment banks in Hong Kong are scrambling to join the bulls.
Just two hours after the Hong Kong Monetary Authority released this message, the Hong Kong dollar had already appreciated to 7.420.
Next, 7.412, 7.407, 7.300.
As he was about to break through the 7.2 mark, Du Xingzhi became nervous.
The entry of a large number of retail investors and third-party institutions directly diluted the share of Hong Kong dollars purchased by the Soros Fund.
Soros purchased another HK$1 billion worth of shares. Du Xingzhi commented, "Soros's approach to the Hong Kong market this time was too mild; he must still have a backup plan."
Yang Fugui said, "Soros is setting up a bull market to sell at a high price. Your Financial Regulatory Bureau is using his scheme to save the stock market. We are mutually exploiting each other in this round."
Du Xingzhi smiled and said, "I think so too. Such a small appetite is not like Soros's style."
Financial Secretary Yang Fugui said solemnly, "But in the short term, our goals are the same."
"Soros is bullish, so of course he hopes the Hong Kong dollar will appreciate. We are about to welcome the return of Hong Kong, and we also hope that the Hong Kong dollar can be in a stable upward trend."
As they were talking, Yang Fugui received a phone call, and the other party said something on the phone.
Yang Fugui's face darkened, and he said to the person on the other end of the phone, "Activate the market stabilization fund; we must stabilize the market!"
"We cannot use such radical methods to inflate the value of the Hong Kong dollar!"
After hanging up the phone, Du Xingzhi asked curiously, "What happened?"
Yang Fugui sighed, a hint of panic in his voice, "You were right. Soros's private equity funds are now buying Hong Kong dollars in large quantities."
"In just one afternoon, the Hong Kong dollar spot market lost $300 million in spot currency."
$300 million! That's roughly two billion Hong Kong dollars! This means that the main speculators have started to take action.
The Hong Kong dollar was instantly driven up to its peak exchange rate that year, and it is still climbing.
Du Xingzhi turned on his computer and saw that the Hong Kong dollar had been speculated up to 7.2, breaking through the threshold almost instantly.
7.200, 7.150, 7.100 – this is not a good sign. Such large fluctuations will inevitably attract a large number of international speculators.
Just then, the phone rang again, and Yang Fugui heard a familiar voice on the other end:
"Director Yang? This is Soros."
Yang Fugui was stunned for a moment and subconsciously looked at Du Xingzhi.
"Have you heard about the news regarding Hong Kong stocks?" Soros chuckled mysteriously on the other end of the phone. "Don't worry, I mean no harm."
"I just wanted to greet you politely and thank you for relaxing the interbank lending rate. The recovery of the Hong Kong dollar market is inseparable from the support of Hong Kong government agencies, and Hong Kong stock investors will be grateful."
He made a provocation without fully understanding what was going on, and then hung up the phone with a laugh.
"Whose call was it?" Du Xingzhi asked.
Yang Fugui's face darkened. "Soros."
“Soros?! He still dares to call?” Du Xingzhi asked again, “What did he say?”
Yang Fugui snorted coldly, "They only said a few provocative words, nothing to be afraid of."
"By the way, the market has rebounded so quickly. Although it was part of our plan, the appreciation of the Hong Kong dollar will definitely attract a large number of international speculators. We must keep the situation under control," Yang Fugui instructed.
"clear."
The Hong Kong Monetary Authority has HK$10 billion in funds available for market stabilization, so they are not worried about the money.
My dear reader, there's more to this chapter! Please click the next page to continue reading—even more exciting content awaits!
Continue read on readnovelmtl.com
