It’s probably not going to happen with any more money.
As early as 1998, Soros and other international players joined forces and threatened to leave Hong Kong empty.
But he ignores the fact that Hong Kong is a strong China behind it.
In the middle of the day, Soros almost ran away.
One, the wind and the rain.
The crisis came on 2 July 1997, the day after Hong Kong returned. It’s just that the storm center was a thousand miles away in Thailand.
On that day, after a difficult struggle, the Thai Government abandoned the fixed exchange rate system and introduced a floating exchange rate system.
The Thai baht, which is pouring into the market, has lost its last line of defence and is rapidly devalued; it comes at a time when prices are soaring, inflation is not worth money; at a later stage, companies are bankrupt, people are unemployed and the financial system becomes fragile; and, ultimately, the country ‘ s market economy is in a state of chaos and people ‘ s lives are disorderly.
This is like a fertile land that was reliant on regular irrigation systems to maintain a balance between crop growth and nutrients. Sporadic floods broke down, the irrigation system collapsed, and the water flowed into the land. And where it passes, the nutrients are quickly lost, crops are uprooted or the land dies because it is barren.
George Soros, the biggest behind all of this, has been denounced by the Prime Minister of Thailand as an “economic war criminal who draws people’s blood”.
Soros is known as a “bandwig in the global economy” and is known as “the real thing.”
In 1930, when Soros was born in Hungary, he emigrated to the United Kingdom and the United States, and in 1970 he formed a quantum fund with Rogers, which gradually accumulated wealth.
By the 1990s, he used two things to make himself famous in the world.
In 1992, Soros made a lot of empty pounds. After a significant depreciation of the pound sterling, it had to exit the European exchange rate system and Soros earned more than $1 billion.
In 1994, Soros shifted his target to Mexico, causing Mexico to lose its foreign exchange reserves, abandon fixed exchange rates and collapse of currency and stock markets. Soros and Quantum Fund are once again “filled.”
And Soros has been able to take advantage of the loopholes in their economic development.
In Thailand, for example, at the end of 1996, after several years of rapid growth, the financial system began to develop in high external debt, chronic deficits and ferocious inflation. Of course they can’t escape Soros’ eyes.
The way Soros makes the baht is not complicated. He borrows a large number of baht from the Bank of Thailand, etc., and then sells it to the foreign exchange market to buy the United States dollar; when a large number of baht enters the Thai market and starts to depreciate, Soros recycles it at a small, low dollar price, and repays the borrowed portion. The difference between this loan and his own pocket.
In other words, the more the baht falls, the more Soros earns.
Despite the Government’s violent counter-attacks, such as the use of Thai baht in the United States dollar foreign exchange-recycling market, or the ban on banks lending Thai baht, it is still not possible to counter international players such as Soros.
In late June, Thailand ‘ s foreign exchange reserves had already spent $30 billion, leaving only $2.8 billion, completely out of resistance and eventually abandoned the fixed exchange rate. The Thai baht falls 20% in one day, and it’s all over.
And in this “flooding flood” the international firefighters such as Soros made billions of dollars.
High profits, which did not satisfy their appetites, increased their strength and spread their hands throughout South-East Asia. In just a few months, countries in South-East Asia, such as the Philippines, Indonesia and Malaysia, quickly fell into the financial turmoil. The famous Four Tigers of Asia lost a lot.
And then, like the dominos that were pushed down, the storm swung into South Korea, Japan, Taiwan in China and Hong Kong.
This is the financial crisis that swept Asia at the end of the 20th century.
Hong Kong, China, which is one of the four Asian dragons, is, of course, a “fat” in Soros’ eyes. In addition to being deeply rooted in Hong Kong itself, it was because Soros’ appetite was so wide that he tried to make a bigger deal and swallow Hong Kong.
If Hong Kong is really the next Thailand, we can imagine this:
The financial turmoil was further exacerbated by the substantial decline in the assets of the rich, whose stocks turned into time-limited bombs, and the fact that they had to shut down companies and factories and even transfer large amounts of assets.
The middle class was troubled, and all efforts were bubbled. Some were selling houses, but they could not be sold repeatedly at reduced prices; some had cancelled the items they enjoyed, such as tourism; and some had transferred their children from private to public schools.
As for those at the bottom, they were already struggling to survive, at a time when hope had been lost. For them, life may have changed from three meals a day to indulgent, from a job with a minimum wage to unemployment without income, and from being able to survive to seemingly not being able to live …
Will Hong Kong stand by?
Soros.
Two, the soldiers are under the city.
At first, international firefighters showed patience.
In mid-July 1997, a small amount of international capital began to test the Hong Kong dollar. The Hong Kong Financial Authority (hereinafter referred to as the “Kim” Authority) used only US$ 1 billion in foreign exchange, which, together with some conventional policies, has stabilized the situation.
The ordinary people of Hong Kong almost failed to respond to what had happened, and it ended without prejudice to their continued immersion in prosperity.
Hong Kong at that time is the fourth largest financial centre in the world, the sixth largest foreign exchange trading market and the second largest stock trading market in Asia; Hong Kong ‘ s major banks and other deposit institutions, with almost trillion dollars in foreign assets, or 8 per cent of the world ‘ s total.
In the first half of 1997, the economy of Hong Kong continued to grow at a high rate, with the building and stock markets rising. As soon as a new building was opened, a long line would be up the previous night. The Hong Kong Stock Residency Index (Hong Fing) as a “broadbarometer” of Hong Kong’s economy soared and broke 16,000 points for the first time on the last day of July.
There are indications that the financial storm appears to have been blocked by Hong Kong.
But is it true?
While Hong Kong’s base is strong relative to other markets in Asia, its shortcomings are also evident: huge housing bubbles, high household indebtedness, excessive corporate dependence on borrowing, and a severe trade deficit.
These issues are also clearly visible to international players. So, while there is no big move, they have long since begun to build up port dollars and futures contracts in secret and to wait.
As a matter of fact, in mid-August, they started the first round of shocks to the Hong Kong dollar.
Two days on August 15th and 16th, the fireman sold HK$4 billion. The Hong Kong dollar and the United States dollar are linked to the exchange rate system (a fixed-exchange-rate system), which ensures the stability of the Hong Kong dollar by linking it to the United States dollar. Since 1983, the exchange rate of the United States dollar to the Hong Kong dollar has been fixed between 7.75 and 7.85.
As a result of the wave, on that day, the United States dollar was at a level of alert, with a constant point of decline of 2.43 per cent. On the next trading day, the constant finger fell 16,000 points and fell to more than 13,000 points in early September.
But Hong Kong and Thailand are different. You know, at the time, Hong Kong had almost $100 billion in foreign exchange reserves. Thus, the Hong Kong Monetary Authority, as in the previous one, used too many Hong Kong dollars in the United States dollar foreign exchange recovery market, while raising interest rates, once again defused the crisis.
For more than a month, the financial markets in South-East Asia began to breathe, exchange rates and stock markets began to rebound, and the annual meetings of the World Bank and the International Monetary Fund were held successfully in Hong Kong. Some international capitalists have also declared that Hong Kong ‘ s economy is very stable.
On October 17, one news broke the calm once again: Taiwan abandoned the exchange rate of the new Taiwan dollar against the United States dollar and in a few days fell to a new low in 10 years.
On this occasion, Soros led other international firefighters, aiming at the timing and preparing to strike Hong Kong hard.
As they know, the Hong Kong dollar will not be so easily crushed. So they set up another trap for Hong Kong.
On October 21, international capital was sold for three consecutive days totalling HK$ 100 billion on an unprecedented scale.
Soon the United States dollar’s exchange rate against the Hong Kong dollar was once again on the alert.
Hong Kong citizens are in a state of panic. The tragedy of the people of Thailand was a matter of good faith and their lives would be destroyed if Hong Kong Yuan were to fall into the Thai baht.
At one point, the doors of the major banks were filled with Hong Kong citizens who came to exchange only the Hong Kong dollar in their hand. For them, the most immediate consequence of the economic crisis is that the money in hand is no longer valuable. They were unable to consider anything else, and the transfer of assets into foreign currency was their last straw to protect themselves in the financial storm.
In order to stabilize the market and the hearts and minds of the people, the Hong Kong Government responded quickly.
In an effort to prevent the Hong Kong dollar from being empty, the then President of the Hong Kong Monetary Authority (HKFC), while buying the Hong Kong dollar for sale by a fireman, urgently raised the Hong Kong dollar’s Interbank Loan Rate. This method has been used many times against speculative capital and has been dubbed “any move”.
Bank-to-bank interest rates are those for short-term capital lending between banks. Increased interest rates on inter-bank lending can increase the cost of international capital lending in Hong Kong dollars, thereby curbing the risk that the dollar will be empty, but also harming the real economic and financial system.
Normally, this rate is less than 5%, but that day, it reached a hell of a 300%! A few days later, a monthly inter-bank lending rate of HK$0.00 went back to over 10%, but still too much higher than normal.
In this wave of the Hong Kong Monetary Authority, the exchange rate of the Hong Kong dollar was saved, and the stock market was less fortunate.
On October 23, the heinogeneity index dropped significantly by more than 1200; on October 28, it dropped more than 1400. So, the heinogeneity index fell to 9000 points.
The Hong Kong stockholders, who had heard and heard many warnings about the previous economic crisis, felt the same way at the moment. The stock trade was not as operational as today, and access to information was very limited, and it was too late when the shareholders reacted and were ready to sell the stock.
Large numbers of shareholders went bankrupt overnight.
There is also the futures market.
In mid-October, the constant-mean futures contract reached 60,000. This means that, in seven short trading days, the international scaffolders trade through stock-in-suppliers, making more than HK$ 13 billion. And Hong Kong’s top 10 rich people lost more than HK$ 210 billion.
The whole economy of Hong Kong, including the city, is in a suffocating atmosphere.
At that time, for example, the star Jong-tao on both sides of the coast had begun two years earlier, making a lot of money. In view of the prospects, he had taken up a very high loan and was preparing to do a big job in the city.
And this financial storm, not only pushed his investment away, but also owed more than HK$ 200 million in debt.
The average Hong Kong citizen, not to mention, is less resilient and many have lost their lives in the storm.
For example, two secretaries of a well-known real estate company had each bought a house for the company before the financial storm. One third of the down payment, which cost them HK$ 800,000, is the money they saved in 10 years of work.
However, they were fortunate that they did not have to wait overnight because of the ease of their work.
A few months later, before they moved in, the house had been reduced by two thirds and the whole house was worth HK$ 800,000. They had to give up their house or repay 1.6 million HK$ to the bank.
Such things were common in Hong Kong at the time. Hong Kong has become the “super money machine” of these financial crocodiles. The evaporated assets of these citizens have also become a part of their saliva.
On 24 October 1997, the Hong Kong Media Bulletin reported on the Hong Kong Unit.
III. INSTRUMENTS
In this round of attacks by financial crocodiles such as Soros, more countries in Asia can describe the “coust soil” as: a 56% devaluation of the Thai baht, a 85% devaluation of the Indonesian guilder, a record low in the exchange rate of the Korean dollar to the United States dollar, foreign exchange controls in Malaysia, and increasing pressure on the yen; Thailand, Indonesia, and South Korea have had to turn to the International Monetary Fund for help.
In particular, the Republic of Korea, which had used almost all its foreign exchange reserves, remained unhelpful and the entire Government was on the verge of bankruptcy. At the beginning of 1998, South Korean civil society also launched a “all-people fund campaign”.
However, the first Chief Executive of the HKSAR, Dong Jianhua, publicly stated that the exchange rate of the Hong Kong dollar was to be maintained, and that the impact of the high interest rates on the stock market was temporary and short-term.
Over the next two months or so, the henant index has hovered around 10000 points, and Hong Kong ‘ s financial stability has been temporarily stabilized.
However, under this kind of international hunting, can Hong Kong Won really be left alone?
At the beginning of 1998, Indonesia’s financial markets had re-emerged, and the International Monetary Fund’s programme had not prevented Indonesia’s economy from bearing the worst recession in history. As a result, the currencies of Singapore, Malaysia, Thailand, the Philippines, Japan and the Republic of Korea fell again.
At the beginning of the year and in June, international firemen such as Soros continued to increase and two more rounds of sniper fire were carried out against the Hong Kong dollar.
With high interest rates, the Hong Kong dollar has maintained the exchange rate, but banks, the market, the stock market, futures, etc. have incurred significant costs.
Hong Kong’s largest investment bank, 100 millionaires, declared bankruptcy in January 1998; by July 1998, Hong Kong’s house prices had fallen by almost 50 per cent as a whole, with some villas worth HK$ 100 billion falling to HK$ 30 million; the stock market’s average daily turnover had fallen from HK$ 15 billion last year to HK$ 4 billion, falling to more than HK$ 700,000; and the number of open-term contracts had gradually increased to nearly 100,000.
As for the livelihood of the people, it is a burden. During this period, Hong Kong ‘ s unemployment rate rose to its highest level in 20 years, with family cars being towed, houses that could not afford to pay their loans being taken back by banks and some having to move from urban to rural areas.
In the media reports, the words “suicide” and “jumping” were used. According to statistics, the suicide rate in Hong Kong rose by 40 per cent during the financial crisis.
Yesterday’s luxuriousness became an unrealistic dream.
Hong Kong citizens in panic
In this way, Hong Kong ‘ s economy is likely to suffer a fatal blow.
However, if the Hong Kong dollar were to be abandoned against the United States dollar, the consequences would be equally precarious and the Hong Kong Government would be in a dilemma.
The Hong Kong Treasury Director, who used to spend vacations with his wife in Istanbul, has had a lot of phone calls with Hong Kong. Halfway to Hong Kong, he said there was an urgent need to get back to Hong Kong and leave his wife in a foreign country.
They have implicitly felt that now is only the beginning, and the most difficult moment has not yet come.
In early August 1998, the Quantum Fund and other international capital once again prepared large amounts of Hong Kong dollars to launch a shock in Hong Kong’s foreign exchange market. This time, the Hong Kong Monetary Authority no longer relied too heavily on interest rates, but more on foreign exchange reserves.
On 5 and 6 August, more than HK$ 20 billion was sold in international capital. For these inflows, the Hong Kong Government absorbs and stores them back to the bank.
This time, interest rates did not change much, but the stock market was not immune. The heinogeneity index went to 7018 points on August 7th. On the same day last year, the heinogeneity index was at its highest level in the history of 16673 points. In one year, the total market value of Hong Kong evaporated HK$ 2 trillion.
On the same day, Dong Jianhua made a public statement:
If anyone thinks we’re going to waver, they’re wrong! We are absolutely capable of maintaining the associated exchange rate with determination, and we will certainly do so. Maintaining the linkage exchange rate would ensure long-term economic viability and benefits for Hong Kong and would be acceptable in the short term.
In the following week, international capital hit successively, and on August 13, the hemonic index fell to 6660 points.
However, the Hong Kong Government has maintained its exchange rate, and these firefighters do not appear to have benefited much. Or are they just going to throw themselves in Hong Kong dollars?
Of course not. And the Hong Kong government has discovered the trap they set.
In this wave of operations, international firefighters appear to be attacking Hong Kong dollars, but the real target is the stock market and futures.
Prior to the attack, they pushed up the stock market and then borrowed a large number of shares and cargo periods to build large stock and futures pallets. Following a series of initiatives in response to the devaluation of the Hong Kong dollar, they took the opportunity to sell large shares, causing a sharp drop in stock and term finger, and then profiting from it.
This method of making a profit is the same as working on empty currency, but when money is exchanged for stocks and futures, the operation is much more complex and secretive.
At a time when the foreign exchange market was relatively cold in the upfront, they did not forget to hoard Hong Kong dollars, so that they would lose little even in the face of the Hong Kong Government’s response.
International arbitrage
This “bilateral manipulation” strategy is clearly smarter than the one in Thailand, which avoids the interest rate defense mechanism in Hong Kong and uses the remittance and stock markets to exert pressure on each other.
Moreover, they are well aware of Hong Kong ‘ s strengths and weaknesses: Hong Kong has a large foreign exchange reserves and the Hong Kong dollar is difficult to shake, yet Hong Kong is a free port, following a free market, and the Government cannot interfere with the stock market and the future market, but only let them kill them.
It seems that for this game, the international players worked hard.
But they can’t figure out what step the Hong Kong government can take to keep the economy alive.
IV. HARD DECISIONS
As early as the October 1997 collision, the Hong Kong Treasury Department had received some information that the real target of these international competitions was not HK$, but the stock and period markets. Except they didn’t have evidence at the time.
At the turn-off earlier in the year, the Hong Kong Government had been aware of the dangers, but there was still insufficient evidence and the situation was not so urgent that little action had been taken.
But the situation has become more apparent in recent weeks. The Hong Kong Government is aware that these activities are depriving Hong Kong investors of confidence and confidence in a free economic system, and that they need to take some special action.
On August 14, they chose to fight back on that day.
This is Friday morning, and in the middle of the morning, in the 13th floor of the China Club restaurant, the atmosphere became very tense.
Sitting in a box is Hong Kong’s three largest securities dealer. They were invited on an emergency basis. They were invited by Chen Deok-chun, Vice President of the Hong Kong Monetary Authority.
Hong Kong’s Monetary Authority has little to do with securities dealers. Why did Chen Deok-hyun suddenly meet them?
Despite the fact that Hong Kong ‘ s most expensive land is beneath its feet, the building of the Hong Kong headquarters of the Chinese bank, which is a symbol of wealth and ambition, at this point they are not in the mood to enjoy it, but are waiting in a state of uncertainty.
Chen Deok-hyun went into the booth alone, asked them to finish their coffee, asked them to turn off their cell phones and took them to the offices of the Golden Directorate.
If there were better ways, the Hong Kong Monetary Authority would not be able to move forward. But helplessly, this time, they are facing too strong a rival.
After all had committed themselves to strict confidentiality, Chen Deok-chun had made a major decision.
Chen Deok-hwan told them that the HKSAR Government had decided to intervene directly in the market and to counter-attack in the stock and futures markets.
This was not an interim intention of the Hong Kong Government, but rather a difficult decision after careful discussion and planning.
In the face of the imminent collapse of the line, they have few options:
I. Continued use of foreign exchange reserves, interest rates, etc. to defend the Hong Kong dollar. The consequences of doing so are obvious, both in the light of the past experiences of countries such as Thailand, which eventually led to the collapse of the financial system and the loss of livelihood, and in the light of the tragic local lessons, which triggered a shock in the stock market and the building market, which in turn could still crush the Hong Kong economy.
(ii) To seek assistance from the International Monetary Fund. This is still too risky, after all, because countries like South Korea, Indonesia and others have used it before, and, while the crisis has been alleviated at once, treating the symptoms, rather than addressing the root causes, is likely to suffer more.
Renunciation of the linkage exchange rate regime of the Hong Kong dollar. This is tantamount to surrendering to international players, and the consequences are self-evident, and Hong Kong is not as short of its foreign exchange reserves as Thailand, and is far from that.
Fourthly, the most difficult and unexpected of the opponents is direct intervention in the market. Thus, both the Hong Kong dollar exchange rate could be maintained in the previous manner, and there is hope that the stock market and period markets will not be associated.
It is clear that the first three options are the same. But is this the last option easy?
First, Hong Kong ‘ s economic prosperity depends on the principles of the free market, and if these principles are undermined, the economy of Hong Kong is likely to lose its life in the financial market as a whole.
Second, the Basic Law of the Hong Kong Special Administrative Region of the People ‘ s Republic of China contains specific provisions prohibiting foreign exchange controls in Hong Kong. The previous confrontation with international capital, in which the Hong Kong Government had been afflicted by international public opinion, would exacerbate the crisis of confidence by intervening directly in the stock market.
Thirdly, there is no wealth of experience to be drawn from the Government ‘ s approach to entry. What is the process of entry? What are the operational and legal risks? Where is the bottom line of intervention? What are the possible contingencies and how should they be addressed? What are the consequences of failure?
But it is hard to think at this point, and if everything is ready, it may be too late, when millions of Hong Kong citizens will be caught in the heat.
Thus, after several days of discussion and planning, the Hong Kong Chief Executive, Dong Jianhua, the Chief Finance Officer of Hong Kong, Zheng Hua, and the President of the Hong Kong Monetary Authority, Zigang, among others, signed the Hong Kong Government’s plan for admission on 13 August.
The possible consequences tell them that this operation can only be won or defeated, and they can’t imagine what would have happened with the multiple effects.
At that time, Zeng Zhang wrote in his book to his brother:
Government participation in the market is a dilemma. Having taken a decision, I am committed to principle and to accepting criticism. I will redouble my efforts to answer to Hong Kongers.
I don’t know.
Our days are very difficult. But I don’t believe that we Hong Kong citizens will lose.
V. Commencement of the duel
The battle will ring.
The three stockbrokers went on to say that they wished to return to their respective companies immediately, to open trading accounts for shares and futures for the Authority and to cooperate with the Government’s entry.
Half an hour before the opening of the stock market, Liang Ding, Chairman of the Hong Kong Securities Commission, was also informed of the government intervention in the stock market and the scheduled market. In addition, the Hong Kong Government has urgently convened the Hong Kong Foreign Exchange Fund Advisory Committee to discuss and agree on this decision.
Soon, foreign exchange fund investments were limited and independently managed the Hong Kong Government ‘ s stock exchange.
The Hong Kong Monetary Authority has also set up a temporary trading room, composed of several reliable personnel, a “war” team. There are several telephone lines in the “Commercial War Room” with audio recording, directly to Hong Kong’s major securities dealers. The President of the Hong Kong Monetary Authority is Zhigang and personally leads the town.
The Hong Kong Government buys mainly the component shares of the heinogeneity index and the heinous futures. In the course of the transaction, they keep an eye on changes in the spot and futures markets in order to adjust their strategies at any time to keep the stock market at the lowest cost.
Of course, many listed companies in Hong Kong have not been idle, but have joined forces to buy back shares in the market.
In the morning, the stock market remained depressed, but after lunch, a miracle appeared and the constant finger began to rebound.
The international firefighters, including Soros, had no idea that the Hong Kong Government would take such a risk. Most of the people were unaware of what was going on until the market was closed that day.
In order to verify the confidentiality of the operation, Chen Deok-hwan even approached several uninformed colleagues and went to the market to find out why the Hong Kong Unit had rebounded. The feedback did not contain any reference to government intervention in the municipalities.
On that day, the Hong Kong stock rebounded strongly, rising 564 points, or 8.5 per cent.
Following the closure of the city in the afternoon, in order to explain the Government ‘ s entry and to ensure as much transparency as possible, and to maintain the rules of the free market in Hong Kong, Tung Jianhua and the right to a shade have made public statements to the outside world.
In his statement, Dong Jianhua said:
In order to make a healthy and efficient adjustment of the economy, stable interest rates are important. The Director of the Treasury Division has today instructed the Authority to use foreign exchange funds to take appropriate action in the stock and futures markets, increasing the costs of speculators and hoping that they will be left unsure.
I would like to point out here that the actions taken by the Government are not intended to be carried out in the city, but rather in response to the current marketing campaign. We are well aware that Hong Kong ‘ s economy is going through a long period of adjustment, which will be painful, but we are psychologically prepared to accept the pain of the period.
I would like to stress that, as in the past, the Government will adhere to a policy of non-intervention in stock and futures market activities, but when necessary, when there is a clear link between the sale of Hong Kong dollars and the sale of stocks and futures, it will have a responsibility to take decisive measures to reduce market disruption. Our economy needs a healthy environment to make rapid adjustments.
We will continue to pay close attention to market developments and, if need be, will take the necessary measures in a timely manner.
When the journalist asked whether the fireman had lost this time and whether there would be a next move, Zhang Jia said:
I believe that there is a profit or a loss, and that they should know for themselves, but it is clear that our aim is to expect that they will have to lose before they leave the market.
Is it only for today? As I mentioned earlier, under what conditions we would operate on the market. If those conditions still exist, we will continue to do so, but if they do not exist, we will not do so. I make it clear that when the Hong Kong dollar is under pressure and some people are working at the same time as our futures market and our foreign exchange market, we will do so.
Not only Soros, but also the international financial community as a whole, have been greatly shocked by the Hong Kong Government ‘ s rescue, which has been publicly criticized by the United States and others.
That evening, a statement was made by the Central News Agency: the Centre fully supported Hong Kong and would at all costs ensure that Hong Kong’s position as an Asian financial centre remained unchanged.
Indeed, as early as March, the central Government solemnly declared that “the Hong Kong Special Administrative Region will maintain prosperity and stability at all costs, and strongly supports the Hong Kong Special Administrative Region in maintaining its system of associated exchange rates and insisting that the renminbi not be depreciated”.
It’s not just a slogan.
At a time when Hong Kong ‘ s economy has been devastated, international players are also taking the lead, claiming that the renminbi will be depreciated or that China ‘ s economic development will be difficult.
At the same time, the weakening of the yen and its sharp devaluation have indirectly increased the burden on the renminbi and the Hong Kong dollar, and many investors and citizens are panicking and are placing high prices on the dollar. On the Shanghai black market, the exchange rate of the United States dollar to the renminbi was even as high as 9.2.
If the renminbi does not carry the pressure and indeed loses its value, this will undoubtedly add to the Hong Kong dollar, which is likely to destabilize the Hong Kong dollar’s associated exchange rate regime.
However, the centre did not do so, but firmly maintained the exchange rate of the renminbi. This increased confidence for the Hong Kong Government and investors.
Soros was caught by surprise. But will the international firemen who were ambushed really get back? Next, will they have a more aggressive offensive?
The Hong Kong government’s entry operation deployment
VI. Final strike
On August 15 and 16, the Hong Kong stock market was closed on weekends. The global stock market fell sharply on 17 September, but coincided with the anniversary of the victory against the Japanese war, with the Hong Kong stock market being closed for one day.
In the next three days, the global stock market rebounded and, with good news and good news, the Hong Kong government stepped in and repelled international firefighters.
The average cost of international silos is around 7,500 points in constant-indicated futures. On 20 August, the heinogeneity index rose to 7742 points, further consolidating the line.
Soros and others were outraged by the continuous interference of the Hong Kong Government, which left them at great cost. But they are too arrogant and their immediate frustration will only make them more radical.
On the 21st, they responded proactively.
That same day, a few minutes before the stock market closings, a number of foreign investors were in trouble, leading to a drop of 200 points in the heterogeneity index within one minute. The port unit was once again pushed to the brink of danger.
The Hong Kong Government also did not hesitate to regroup after the end of the weekend. The same day there was a dramatic turbulence in the hemogeneity index and in the hemous futures, with both sides coming and going back, and a short drop of 300 points.
In the end, the constant-life index was raised to 7845 points by violence and the constant-definition futures were close to 800 points by operation by the Authority and the major securities dealers.
These international agglomerations took up another defeat and then played other ways. They have begun to use the media to silence the Hong Kong Government in an attempt to use international public opinion to prevent its continued interference in the market.
But they underestimated the determination of the Hong Kong government. How can you give up if you’ve chosen?
As the entry process progressed, a growing number of securities dealers began to join the Service. They are only responsible for the execution of the directive, and they have been very well informed in their efforts to do so, regardless of the strategy of the Authority. After all, this is about the fate of Hong Kong as a whole.
At this critical juncture, two Vice-Presidents of the Central Bank in Beijing arrived in Hong Kong, and the Chinese-owned institutions in Hong Kong were informed that they were fully committed to supporting Hong Kong ‘ s escort operations.
The trouble has shifted to the international fire. Their futures contracts are due to expire at the end of August, and they expect that the port stock and the market will not hold the bottom line and that they will succeed and win.
Now they face a dilemma.
Some of the firefighters were at risk and had to withdraw from the bet and start buying back the stocks sold. The other, represented by Soros, is looking to see whether more futures contracts will be shipped to September.
In response, the Hong Kong Government pre-empted the September pointers to raise the cost of international firefighters.
This means that August 28th, the date of the futures settlement, is probably the day of the war of the financial war.
With only three days left, every step is crucial, and every imprudence is lost.
August 26th, penultimate day.
The Hong Kong Government and the international community buy and sell at the original pace. At around 15 p.m., however, the Hong Kong Government suddenly collected all the purchases and began to sell the futures.
Some of the unknown international workers were unable to analyse them in depth and were eager to sell them with the Hong Kong Government.
In two minutes, the heinogeneity index dropped by 160 points, and the heinous futures fell even harder, approaching 300 points.
The Hong Kong Government then came to pay back and bought stock and futures in large quantities. In the end, when closing, the constant finger drops by 55 points, and it’s safe.
August 27, penultimate day.
The day was marked by a decline in the stock markets of the United States, Latin America and European countries, which is undoubtedly bad news for the Hong Kong stock. In an interview with the media, Soros’ assistant said with full confidence: “Hong Kong will lose!” I’m sorry.
In the morning, the Hong Kong stock was open on time and international capital came out, and in only half an hour, the turnover was approaching HK$ 3 billion.
The government of Hong Kong is at risk. Under the command of Tseng Shae, the Hong Kong Government commissioned 10 agencies to pursue and intercept 33 constant-finger units and futures. Within one day, HK$20 billion was invested in raising the heming index to 88 points and stabilizing the situation again.
Tomorrow, if the Hong Kong stock market and the future market fail, the Hong Kong government’s previous investment of HK$20 billion will be the result of a flood of water in the sea and the whole city will be engulfed by waves.
Waiting for the dark shadow of the sun and weeping in silence.
This evening is destined to be a sleepless night for the whole city.
14-28 August: Action taken by the Hong Kong Government
VII. THE MURDER OF THE MOUNTAIN
Early in the morning of 28 August, a thunderstorm warning was issued by the Observatory over Hong Kong.
More terrible moments than storms followed.
At 10 a.m., the Hong Kong stock market opened, and Soros led a crowd of firemen to sell, especially the two components of the Heming Index, Hong Kong Telecommunications and HSBC, such as heavy rains, which were overwhelming. In five minutes, it always means the value of the deal is over HK$3 billion.
In response, the Hong Kong Government pays for it all, regardless of price.
Constantly pointed at the line at 7,800 points, drifting up and down. In half an hour, the turnover is over HK$10 billion. Every second, it’s millions of HK$.
Before the end of the morning, the firemen went on to sell blue-chilling shares such as Yangtze Industries and China Telecommunications, and a large number of European funds joined without warning. In half a day, the constant value of the transaction has exceeded 40 billion, close to the one-day record of the previous year’s bull’s peak.
No one can relax at lunch break.
At the beginning of the afternoon, the most tense moments in history have been met with constant guidance. The firemen began to increase their firepower, with their constant fingers falling at 300 points in an instant, and the Hong Kong government responded quickly and pulled back 7900 points.
At the end of the day, the ammunition of international capital was concentrated in the “HSBC” stock of heavy-pound ingredients, which everyone was watching. The Hong Kong government has given an additional HK$ 30 billion to defend itself.
There is no exaggeration in the exchange atmosphere, which says the battles are fought in seconds.
The busy Hong Kong Stock Exchange Hall.
At 16 p.m., the bell rings and the number on the exchange screen finally stops. Heinogeneity index, constant-meaning turnover, constant-mean futures, set at three different numbers:
7829 points! 79 billion HK$! 7851 point!
The HK$79 billion has also generated a record of single-day sales in the Hong Kong stock market. On that day, the unsatisfied contracts for the constant-mean futures amounted to over 150,000.
I’m a fool. Formerly, in many countries, such as Soros, which had won $4 billion in Thailand alone, much more than in other countries.
Before they came to Hong Kong, they wanted to get, almost to the point, to try to create a miracle again.
But what happened? In this “Hong Kong siege” operation, Soros and his quantum fund alone lost about $800 million.
Other international players who were going to eat with this giant, had no idea not only had no soup but had burned their mouths. In the last 10 days alone, they lost billions.
The Hong Kong Government has used about HK$ 120 billion in foreign exchange reserves, killing all of these international capital and earning about HK$ 2 billion in futures markets.
However, they were not willing, especially Soros, to lead some people to transfer part of the contract to September.
In order to prevent the backlash, the Hong Kong Government continues to push up the price of stock-indicated futures.
On 5 September, the Hong Kong Monetary Authority issued seven measures on foreign exchange, securities trading and settlement, which, in policy terms, limit speculation in international bidding. On 7 September, the Hong Kong Government enacted 30 new regulations to enhance order and transparency in the Hong Kong securities and futures markets and further reduce the possibility of transnational capital speculation.
Also on this day, the heinogeneity index rose by nearly 600 points, again reaching 800 points.
These initiatives, known as the “Sevens and Thirtys”, have greatly consolidated the outcome of the financial defence war.
Soros, among others, who had become poor, had to opt out of the continuing loss.
During the year, there was a rare negative increase in profits from quantum funds.
The tide retreated and Hong Kong’s financial markets began to recover. On 7 September, Hong Kong’s inter-business interest rate fell to 4 per cent, with a minimum of 1 per cent after two years.
The Government of Hong Kong invested in the stock market and futures and gradually withdrew in the following year, totalling billions of dollars.
On December 6, 1999, the heinogeneity index returned to the 16000 point period. After several years of recovery, the Hong Kong economy has entered a new stage of development.
Follow-up
1 With regard to the interference of the Hong Kong Government in the stock market, there was once strong criticism from the European and American countries, although the Hong Kong Government’s explanation remains valid. In the subsequent economic crisis, several capitalist countries have intervened in the market to varying degrees, even in the light of Hong Kong’s experience, which can be described as “extremely offensive”.
The difficult victory of Hong Kong means that the Asian financial crisis has come to an end. Its impact, however, has not stopped, and has since hit countries such as Russia, Brazil and Colombia. The storm ended officially in 1999.
This protracted crisis has directly or indirectly affected regime change in many countries. In Korea, the conservative Great National Party, which had been in power for many years, was defeated and the Democratic Party of the New Millennium took power for the first time in the wild; in Thailand, the United Government came to power and the Democratic Party returned to power; in Indonesia, President Soeharto, who had been in power for 32 years; in Malaysia, the Deputy Prime Minister was dismissed; in Japan, Prime Minister Ryutaro Hashimoto resigned; and in Russia, six Prime Ministers were replaced for more than a year.
Remarks:
In this financial crisis, which involves international capital and operational and financial knowledge of the countries of South-East Asia, Hong Kong and Taiwan, which is more complex and professional in nature, it is not detailed in this paper and relevant professional information is available to interested readers.
References:
” Asian Financial Storm: Hong Kong ‘ s Financial Stability and Protection War ” , Hong Kong Finance Authority, Chen Deok-chun
“Recall Hong Kong’s year in the face of adversity”
” Defending Hong Kong ‘ s Monetary Stability ” , ” Coping with the Financial Crisis ” , Ren Zigang
Statement by the Chief Executive of Hong Kong, full statement by the Chief Finance Secretary of Hong Kong, statement by the Chief Finance Officer of Hong Kong, etc., Official Gazette of the HKSAR Government
Hong Kong’s Financial Defence War is Prudentially Optimistic – An Analysis of the Advantages and Benefits of Public Interventions in the Market, Hong Kong and Macao Economy, Know Net, Fu Xianhui
A letter from the Chief of Finance of Hong Kong to his brother, Zhang Qi.
Historical data on the round price of the henant index, 1986-2013
CCTV special program “Contrato Hong Kong”: Hong Kong Financial Defence War
Rehearsal of Thai baht snipers and Hong Kong currency defenses during the Asian financial crisis: Technological Combination, series of papers by the China Finance 40 People ‘ s Forum, Tsai Tsao, Xie Feng
Hong Kong Financial Defence War Study, Deep Seen Stock Exchange website, Tang Yong
Former Assistant Soros Memorizing the Financial Crisis: A Decisive Port of Hong Kong, 1st Financial Journal
” 40 years of financial defence in Hong Kong: Hong Kong versus Soros ” , Chinese Economic Journal
Tung Jianhua’s Blood War Soros!
Soros hedge fund! AAF Evaluation of the causes and techniques of the year that hit Hong Kong, Hu Qingqing
“The Five Grievances of My Life,” Yellow Eagle.
Public coverage of the event in other national and international media, including text, pictures, videos, data file number: YX11Q2Jp8VP
I don’t know.
Keep your eyes on the road.