Ten days later.
Wangcai flew back to Hong Kong from Mexico to report to Chen Dong on the relevant situation of the Mexican peso loan.
The amount of over eight billion US dollars, converted into pesos, is over two hundred billion pesos.
For such a large sum of money, Wangcai used more than twenty commercial banks and spent a full seven working days to get the loan approved.
"Boss, we've completed the loan process! So, what's our next goal? Should we invest all this money in Mexico?"
Based on his own experience, Wangcai believed that it was problematic to increase the exchange of Mexican pesos at this time.
Because the country's domestic economic situation has been very poor this year, although its interest rates are still relatively high, its domestic situation is very turbulent, and even presidential candidates are being assassinated.
A turbulent political situation can amplify the risks in the capital market.
Although chaos means opportunity, Wangcai believes that seizing opportunities under such circumstances is extremely difficult, and a slight misstep could lead to total defeat.
"Give the order: starting today, exchange all the pesos you have for US dollars. The daily exchange volume should be at least $450 million. Of course, the more the better." Chen Dong's tense mood finally relaxed.
The loan process is complete; all that's left is to proceed with the exchange step by step. This requires no technical skill, and my subordinates can easily handle the relevant procedures.
Although their previous lending activities went unnoticed, the sheer scale of the loans will undoubtedly have a significant impact on the market in a very short period of time.
If the regulatory authorities had detected this abnormal fluctuation in the financial market in time and taken decisive measures, Chen Dong's previous plans could very well have been ruined.
For example, if the Mexican government suddenly announces a devaluation of the peso, Chen Dong would have no choice but to act immediately and exchange his pesos for US dollars as quickly as possible.
During the peso's devaluation, he also had to manage the exchange process carefully.
Because in this life, he also got involved in the speculation of the peso, and it was no longer just Soros and other speculative capital groups involved. This meant that more variables had emerged, and he could no longer rely on his memories from his previous life to judge how low the peso would fall and whether the Mexican government would make a decision to devalue it.
If he can't earn the corresponding interest, then even if his invested funds don't all go down the drain, he will still face huge losses.
For speculators, attacking countries with fixed exchange rates is considered the best option because it carries the least risk and the highest return, but the magnitude of this risk is only relative.
This is especially true for the party with a large sum of money and a long holding period.
The more cash you hold, the more interest you have to pay.
If the attacking side fails, the losses from currency exchange and the interest payments will be a huge expense.
Of course, under normal circumstances, this loss is much lower than the profit that would result from a successful attack.
This situation has led many financial institutions, such as hedge funds, investment banks, and commercial banks, to particularly favor targeting countries that implement fixed exchange rate systems.
Currently, there is still a great deal of controversy in Mexico regarding which exchange rate system to adopt: whether to stick to the existing fixed exchange rate system pegged to the US dollar or to switch to a floating exchange rate system. Supporters of different policies are engaged in fierce debate.
However, because Mexico maintains a high interest rate policy, the inflow of foreign capital still exceeds the outflow.
Furthermore, because Mexican banks hold hundreds of billions of dollars in foreign exchange reserves, Mexican government officials simply smiled indifferently at the attacks launched by international speculative capital, thinking that they were simply overestimating their own strength and were not particularly worried.
At this moment, upon hearing Chen Dong's words, Wangcai vaguely realized what Chen Dong was planning to do.
However, Wangcai never expected that Chen Dong would be so audacious as to try to shake up such a huge economy as Mexico with the strength of his own family.
Of course, Chen Dong has other tricks up his sleeve. He is not fighting alone, but has powerful allies.
Chen Dong picked up the phone and called Li Xiaoman first, "Sister Xiaoman, could you please come over for a moment? There's something I need your help with... It's about the bank, of course."
Then, he called Zhang Zhong, a person with connections at Standard Chartered Bank.
Chen Dong brought in HSBC and Standard Chartered as allies because, as established banks, they have their own channels and backgrounds, and their influence in the industry cannot be ignored.
At this time, in order to complete the harvest of Mexican pesos, Chen Dong decided to further persuade Standard Chartered Bank, HSBC and other banks to increase their support for him.
It's important to understand that in terms of economic size, Mexico is a significant country in Central America, a region with many nations.
It is estimated that Mexico's GDP will exceed US$280 billion in 1994, while its foreign exchange reserves will be around US$24 billion.
In addition, the Mexican government issued a large amount of short-term bonds to make up for the current account deficit in international trade, amounting to more than $24 billion.
Meanwhile, a total of $70 billion in capital from US funds flowed into the Mexican stock market.
In short, no matter who you look at it from, the Mexican government's strong economic power is something that Chen Dong alone cannot shake.
Not long after, Li Xiaoman arrived, bringing with her a fragrant scent.
This chapter is not finished yet. Please click on the next page to continue reading the exciting content!
Continue read on readnovelmtl.com
