bullyxtreme Chapter 314 Turning Point
Chapter 314 Turning Point
July 14, 1998, 8:50 a.m.
In the trading room of Yu Hui Capital, all seven people had arrived.
Chen Ziang sat at the control panel, with three monitors side by side in front of him. The screens displayed the Hang Seng Index futures price—6981.
His hand was on the mouse but not moving; his eyes were on the screen, but his focus wasn't on it.
Zhang Mingyuan, sitting next to him, was flipping through a printed press release, the edges of the paper crumpled from his grip. The headline read: "Hong Kong Government Announces Use of Exchange Fund to Defend the Linked Exchange Rate."
The clock on the wall pointed to 8:55. "Five minutes until the market opens," someone said.
But no one responded; everyone remained silent.
At 9:00 AM sharp, the Hang Seng Index opened at 7042, 58 points higher than yesterday's closing price.
No one spoke in the trading room; only the numbers on the screens fluctuated. 7030, 7050, 7080…
Chen Ziang tapped his fingers lightly on the table. Once, twice, three times.
"It's still rising," Zhang Mingyuan said.
9:15, 7120.
9:30, 7200.
10 o'clock, 7350.
11 o'clock, 7480.
Zhang Mingyuan took off his glasses, wiped them with the corner of his clothes, and then put them back on.
"Is this true?" he asked in a low voice.
No one answered him.
At the close of trading at 12:00, the Hang Seng Index stood at 7512 points.
It rose 528 points in half a day.
In the cafeteria, several people were eating together. This time, someone spoke up.
"The Hong Kong government is serious this time," Zhang Mingyuan said, picking up a piece of food with his chopsticks. "They've poured over 10 billion into this; it's no joke."
"Over 10 billion?" Lin Jiayi asked. "Has the specific amount been released?"
"The news was just announced this morning," Zhang Mingyuan said. "The Hong Kong Monetary Authority has confirmed that the Exchange Fund will be used, with no upper limit and no specific amount, but the estimate is over 10 billion."
Lin Jiayi didn't say anything. She lowered her head and ate very slowly.
Chen Ziang sat in the corner, his meal barely touched. He used his chopsticks to stir the rice, grain by grain, as if he were counting them.
"Zi'ang," Zhang Mingyuan called to him.
Chen Ziang raised his head.
"What do you think?" Chen Ziang was silent for two seconds. "Let's wait until the market closes." He didn't say anything more.
The market opened at 1 p.m.
The Hang Seng Index continues to rise. 7600, 7700, 7800...
Two points, breaking through 8000 points.
In the trading room, someone let out a long sigh of relief.
Three points, 8100 points.
The Hang Seng Index closed at 8237 points at 4 p.m.
The index rose 1253 points throughout the day.
Chen Ziang stared at the closing price, 8273.
It is 1253 points higher than yesterday's closing price and 1793 points higher than the lowest point five days ago.
He leaned back in his chair and closed his eyes.
Their predictions were wildly wrong. They rushed to build positions during the rebound, and when the market fell, they predicted it would drop to 5800 points. They were even indignant about Mr. Ling's prediction of 6666 points, feeling that the number was too ridiculous. As a result, these self-proclaimed professionals were repeatedly proven wrong.
The conference room door opened. Li Ziyu walked out.
"Thank you all for your hard work," he said.
It was quite embarrassing that no one spoke up; I felt ashamed to admit that I had worked so hard.
Li Ziyu walked to the window and looked out at Victoria Harbour. The setting sun was turning the seawater orange-red.
"I just got a few phone calls," he said without turning around, "all asking for information."
"What news?" someone asked.
"They asked us if we had any inside information." Li Ziyu turned around and asked if we knew in advance that the Hong Kong government was going to intervene.
He looked at Chen Ziang, and Chen Ziang looked at him.
"I said I didn't know," Li Ziyu said. "We were just following orders."
Chen Ziang nodded. "Mr. Ling, do you have some inside information?"
"No, Mr. Ling doesn't have such deep connections. Even if he did, he wouldn't be able to predict so accurately. The 6666 point is only 6 points higher than the closing price and more than 100 points higher than the lowest point. Although I don't know how Mr. Ling came to this conclusion, the battle between the bulls and bears is not solely determined by human will. Ultimately, it is the result of a game of strategy." Li Ziyu still strongly supported Ling Yun.
"Furthermore," Li Ziyu continued, "Soros gave an interview today. He said that Hong Kong is no longer a free port, that the Hong Kong government's intervention in the market was a mistake, and that in the long run the market will punish those who intervene."
"How will the media report this?" Zhang Mingyuan asked.
"The Wall Street Journal published it with the headline 'Hong Kong Abandons Free Market Principles.' The Financial Times also reported it, saying 'Hong Kong Government's Intervention in the Market Sparks Controversy,'" Li Ziyu said. "But the local media have different perspectives. Ming Pao's front page read 'Hong Kong Government Decisively Intervenes to Stabilize Financial Markets,' while the Hong Kong Economic Journal reported 'Hong Kong Monetary Authority Takes Action to Defend the Linked Exchange Rates.'"
Lin Jiayi stood up. "What about those short sellers?"
"How much was closed out today?" Lin Jiayi continued, "Has anyone kept track?"
"There's no official data yet," Li Ziyu said. "But as far as I know, several large hedge funds are liquidating their positions today. Not all of them, but some. They're waiting to see if the Hong Kong government can hold on."
"Where is Soros?"
"He's still here," Li Ziyu said. "He's different."
"What's different?"
Li Ziyu paused for a moment.
"He's not in it for the money," he said. "At least not just for the money. Their scheme isn't simply to make a little money. They want to turn Hong Kong into their economic colony so they can do whatever they want there, turning Hong Kong into an ATM where they can withdraw money anytime."
Lin Jiayi was somewhat skeptical. "They short sell not to make money? They can't influence Hong Kong's economic and financial policies, so how can they turn Hong Kong into their ATM?"
Li Ziyu shrugged. "Ling Yun said that finance is just a tool for exploiting ordinary people; it doesn't generate value itself. Those who believe in Western economics will ultimately become tools of capitalists and accomplices in accumulating global wealth."
"To truly understand and utilize finance effectively, you need to break free from the framework, formulas, and definitions provided by Western economics. The world situation, political maneuvering, and the interplay of capital are the decisive forces in finance."
Li Ziyu passed on the deceptive rhetoric that Ling Yun had given him to these traders. These words were absolutely correct nonsense, but because of Ling Yun's success, they made these words seem philosophical and had a sense of returning to simplicity by repeatedly savoring them.
October 7, Wednesday.
Hang Seng Index opened at 8312 points.
The market closed at 8643 points in the afternoon.
It rose by more than 2000 points in two consecutive days.
October 7th, Thursday.
Hang Seng Index opened at 8712 points.
The market closed at 9023 points in the afternoon.
In the trading room, someone started to laugh. It was soft, but it was definitely laughter.
Chen Zi'ang did not laugh.
He looked at the number, 9023, which was 2,579 points higher than the lowest point.
He recalled standing in this trading room a month ago and telling Ling Yun, "I'm resigning."
I remembered Lingyun saying, "We'll know the result in a couple of days."
Now he knows the result: Ling Yun was right, and he was the one who got proven wrong.