The exchange rate was driven up to an explosive level, and everyone stared wide-eyed at the crazy numbers: 8.6, 8.5, 8.3. Foreign exchange increases are usually measured in cents, but now they were increasing by one cent at a time.
When the figure was pushed up to HK$8.20, HK$17 billion was dumped, instantly dropping to HK$8.50, followed by another HK$10 billion in continuous dumping.
It pushed the exchange rate all the way up to the nine-dollar mark!
"Hold on to nine yuan!" Lu Feng said in a deep voice.
Nine yuan is a very crucial position. A lot of people entered at nine yuan and sixty cents. If it's ten times leverage, nine yuan is exactly the point where margin calls are triggered. With the price rising all the way up, many people have already been liquidated.
Also, if the price stays around nine yuan, the opponent's counterattack won't be too strong, and the financial burden won't be too severe.
This is not just a matter of the overall market, but also the situation within the exchange. Although Lu Feng claims to have hundreds of billions, the actual funds available in his account are only 50 billion. The rest will be transferred later depending on the situation.
Besides, spending hundreds of billions of dollars on the very first day is something that can't be explained to the leadership. Several aspects need to be balanced, things need to be done well, and too much money can't be spent.
With less than twenty minutes left before the market closed, Lu Feng placed over 3 billion yuan in the order book, demonstrating his determination to defend the 9 yuan mark. The selling pressure began to ease, clearly indicating that no one wanted to enter the final battle today, as they would raise funds and gather information later.
As the market closed, everyone in the room took a deep breath. Beads of sweat were already visible on Lu Feng's forehead. The Hong Kong dollar had surged by 7% tonight, a rise that could definitely be described as a surge for a currency.
The leaders outside stood up and applauded. Lu Feng pushed open the door and walked out, looking at everyone and saying, "I can barely say that I have fulfilled my mission!"
"Well done!"
"Great job! You've worked hard!"
People stepped forward to shake hands and exchange pleasantries. One of the leaders asked, "How long do you think it will take to defeat Wall Street?"
“This matter is uncertain and requires a process of negotiation and mutual probing. At the same time, this is not a personal matter; we need to release information to the public and rebuild confidence,” Lu Feng said, looking at him.
"Have some water, take a short rest, and then we'll have a meeting!"
Lu Feng nodded and looked at the clock on the wall. It was already 3 a.m. Tonight was destined to be a sleepless night. At 3:20 a.m., Lu Feng walked into the conference room and discussed the current adjustments to the Hong Kong foreign exchange market and stock market.
Lu Feng suggested that the practice of cutting off internet access should be stopped, as it would damage public confidence. He also suggested that restrictions on short selling should be strengthened, and the minimum amount required to open a short position in the stock market should be raised again to prevent people from using leverage tenfold to short sell. Although the Hong Kong Monetary Authority has raised the minimum amount for short contracts twice, Lu Feng believes that it is still not enough.
Short selling should be expensive, while margin financing should be cheap, so that everyone has a lower threshold to go long instead of shorting, and at the same time, higher limits should be set on price drops.
We can't just dump stocks at the drop of a hat; we need to put the rises and falls in a cage.
Lu Feng even proposed setting price limits and circuit breakers for Hong Kong stocks, but these proposals were rejected because Hong Kong, as a global financial hub, would be hindered by too many restrictions on capital flows and would damage its reputation.
The meeting lasted three hours and determined several action plans. First, it encouraged listed companies to repurchase shares and then inject capital after the market closed, amounting to no less than HK$20 billion, to reduce share liquidity. In short, it meant the government was getting involved in market manipulation.
For Hong Kong dollars, the margin requirements for short selling should be increased to limit the decline as much as possible and restrict their leveraged short selling!
While increasing the difficulty of short selling, Lu Feng wants to drive up the exchange rate in the market. If he plays this game, even if Wall Street still has hundreds of billions of Hong Kong dollars in hand, it will be difficult to drive it down.
The meeting didn't end until the sky was just beginning to lighten. After a quick breakfast, Lu Feng, who hadn't rested for almost 24 hours, still couldn't rest.
To conceal her exhaustion, she hired a makeup artist to tidy herself up before giving some morning news interviews and releasing information to the public.
"First of all, we congratulate Team Leader Lu on achieving a great start. The Hong Kong dollar exchange rate has been boosted by seven points. On behalf of our financial audience, I would like to ask why it has suddenly rebounded so much?" the reporter asked.
"Of course, it's the country's determination. Although the market was volatile last night, there was little risk. In fact, the short sellers were even wiped out at one point. This situation is due to the mainland's determination to invest in Hong Kong. As far as I know, the relocation of manufacturing from the mainland is a certainty!"
"Their shorting of Hong Kong is simply to say that Hong Kong's property market is soaring, its per capita debt ratio is high, its manufacturing industry is hollowing out, and the whole society is leaning towards deindustrialization. In that case, the manufacturing industry in the coastal areas of the mainland is not weak!"
"A large number of high-end companies, such as Hurricane Capital, will flock to Hong Kong. This is also a great opportunity for mainland companies to develop. They can raise funds better here, and the outside world can also invest in the mainland better through Hong Kong!"
"This news is indeed quite astonishing. The mainland is so vast; even just moving some industries over there would be enough for Hong Kong to absorb for a long time." The host looked at Lu Feng and said, "So, does last night's statement mean that this crisis has been completely reversed?"
"This crisis is man-made. We reduced stamp duty, raised bank deposit interest rates, and attracted Hong Kong dollars back from around the world. External short-selling forces are minimal. When large amounts of capital enter, it proves we are not just a bunch of bloated investors." Lu Feng looked at the host and said, "I believe Hong Kong stocks will start a surge today. This is a man-made bear market, so a return to a normal bull market is about to begin!"
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