Hong Kong Movies: You Hongxingzi, what the hell is the charity king?

Chapter 836 "834" Guan Zu was speechless: Soros, you're useless, it hasn't even fallen that much...

Hong Kong Island in the early morning,
Massive Hong Kong dollar sell orders appear in the US and UK currency markets; Soros fires the first shot in his attack on the Hong Kong dollar.

With reports from foreign media outlets like the South China Daily, the news, like a stone thrown into calm water, instantly stirred up waves on Hong Kong Island.

The camera pans across a newsstand on a street corner, where newspapers have been snapped up, and those who managed to buy them are standing on the roadside reading them.

Passing by the crowded tea restaurant, the television was broadcasting news of the Hong Kong dollar being dumped. Diners put down their chopsticks, slammed their fists on the table, and cursed the international speculators, their spittle flying onto the table with their anger.

In the streets and alleys, in tea restaurants and vegetable markets, everyone is talking about the news in the newspapers.

"They actually attacked Hong Kong Island."

The citizens who had been hoping to get away with it were now completely enraged.

"Soros, you son of a bitch!"

"They messed with Southeast Asia and now they're messing with us, damn it!"

"What are you afraid of? Damn it, with Mr. Guan here, why would we be afraid of Soros?"

"Yes, it's Mr. Guan!"

The citizens began to calm down after the initial chaos.

With Mr. Guan around, what's there to be afraid of!
At this time,
There are more investors trading here at the Hong Kong Stock Exchange than before.

Some people trust Guan Zu, but others find it too difficult and want to reduce their holdings first.

With the stock market open
Some retail investors crowded in front of the trading desk, selling their stocks one after another.

……

Landmark, Soros Fund Management.

"The market opened lower, not bad~~~"

Rodney Jones' team members smiled as they watched the stock market decline.

"Alright, everyone~~~"

Rodney Jones clapped his hands.

"Everyone, begin proceeding according to plan!"

Rodney Jones pointed to the split-screen data on the screen, his voice tinged with amusement.

"In the foreign exchange market, continue to intensify the selling of Hong Kong dollars. Don't be afraid. Sell off the chips we accumulated in the early stage in batches to maintain the continuity of the selling pressure, making the market think that the selling is endless, forcing the Hong Kong government to use up its foreign exchange reserves to take over."

"In the stock market, we're targeting HSBC, Standard Chartered, Hawley, Cheung Kong, New World Development, Dragonair, and other index constituents. We're dumping large orders to create panic and get retail investors to sell as well."

"Remember, don't dump everything at once. Do it in stages, and make sure each drop makes them feel like 'it hasn't bottomed out yet.'"

"The Hong Kong stock market is currently at 17530 points. This time, our goal is to drive it down to below 14000 points."

then,

Rodney Jones turned to the screen displaying the futures market.

"Regarding the futures market, we continued to increase our short positions in the Hang Seng Index futures market, taking advantage of the stock market's decline, and further increased our open interest in the December contract. At the same time, we shorted the constituent stocks in the spot market, using both sides in tandem to make the index fall even more sharply—when the futures expire, we can close our positions at a lower price, and this price difference is our profit."

"Alright, let's get started... everyone~~~~"

The team immediately sprang into action, the sound of keyboards clapping incessantly.

Foreign exchange sell orders were issued...

HSBC Holdings was among the first to dump shares...

Adding to short positions in stock index futures...

Rodney Jones watched the numbers on the screen, smiling outwardly but remaining wary inwardly.

Guan Zu, oh Guan Zu...

What would you do in this situation?
……

With the Soros Fund dumping its shares,

In the stock market, large-cap stocks such as HSBC, Cheung Kong, China Fortune Land Development, New World Development, Cheung Kong Holdings, and Hong Kong Dragon were under slight pressure in the morning session, falling by about 1% in the first half hour. The Hang Seng Index followed suit, dropping by more than 0.2%.

Some retail investors are selling off their holdings, but many more are still observing.

Anyone who has traded stocks knows that cutting your losses and leaving the market is very painful.

Besides cutting their losses and leaving the market, they can choose to buy more at the bottom to lower their average price; others will hold on stubbornly, regardless of market conditions, just waiting for dividends, as long as it doesn't get delisted...

Although there were murmurs in the trading hall, things weren't chaotic.

In the futures market, short positions gradually increased, with over two thousand contracts added in just one hour. Long investors, seeing their accounts showing floating losses, either chose to reduce their positions to cut their losses, or decided to wait and see; overall, the market remained relatively stable.

(P.S.: Hong Kong Island is a free economic zone, so the government will not prevent futures and stock index brokers from selling short positions to Soros.)
In the foreign exchange market, the Hong Kong government intervened to absorb some sell orders, so the selling pressure in the market was not particularly high.

A few people came to exchange for US dollars at the bank exchange window. The line was not long, and most of them just asked about the exchange rate and left.

……

The stock market is temporarily closed at noon.

Landmark,

Soros Fund Management.

At this moment, a group of senior executives were reviewing the morning's 'achievements'.

Rodney Jones tapped his fingers lightly on the table, his brow furrowed as he stared at the slowly descending index on the screen, his tone slightly...

"Why is it so hard to smash?"

The other team members also frowned.

"Yeah, that's weird."

"Thailand and the Philippines are very easy places."

"..."

"Look, the volume of small sell orders is less than half of what we expected, which shows that retail investors are more resilient than we thought."

"When the market crashed in Thailand, people rushed to banks overnight to withdraw their money, and retail investors were the first to flee the stock market. But here... they don't seem afraid at all?"

"There is only one possibility: people in Hong Kong Island have confidence in the Hong Kong dollar and the market, so they will not follow the trend and panic. The chips we sell will not create an avalanche effect at all."

Everyone was silent,

Everyone felt this was a difficult situation.

Rodney Jones was getting a little annoyed.

The team's analyst pushed up his glasses: "We're running out of chips faster than planned, but the market hasn't fallen as much as we expected. If this continues, we'll have to pay a lot more in interest on borrowed funds. If this drags on..."

"Our profits are about to shrink."

Rodney nodded, but his expression hardened, and he ordered, "All the world's speculative capital is watching Hong Kong now. We have no way out. Increase the pressure! Sell another 500 million in the foreign exchange market, and dump another wave of those dozen or so index constituent stocks in the stock market... I don't believe they can hold out for long!" "Yes, sir!"

Everyone took action.

Rodney Jones stood in front of the floor-to-ceiling window, looking at Central Plaza in the distance to the east.

"Master Guan, is this the source of your confidence?"

……

……

"Ahhh~~~~"

Guan Zu's office, top floor of Central Plaza.

Guan Zu sneezed and couldn't help but say, "Someone must have been saying I'm handsome behind my back!"

Wu Lianqian, who was reporting from the side, was sweating profusely.

The office television was broadcasting ATV's midday news.

"The Hang Seng Index opened slightly lower this morning, experiencing only a small drop of -0.3%, but remained generally stable without any large-scale panic selling. Investors were largely adopting a wait-and-see attitude..."

"In the foreign exchange market, the Hong Kong dollar exchange rate against the US dollar remains stable within the linked exchange rate system range..."

A spokesperson for the Hong Kong Monetary Authority (HKMA) said today that Hong Kong Island has ample foreign exchange reserves and a sound financial regulatory system, and is fully capable of coping with external challenges. The HKMA is confident in maintaining the stability of Hong Kong's financial market.

"Next, let's turn our attention to the avian flu outbreak..."

"At 9 a.m. this morning, another citizen was admitted to the hospital after contracting the avian influenza virus. Five months have passed since then, and 87 citizens on Hong Kong Island have been infected with the avian influenza virus. Relevant departments are making every effort to control the outbreak..."

"Now we're broadcasting international news..."

"This morning, Malaysian Prime Minister Mahathir angrily accused Soros, saying that his malicious manipulation of the financial markets has severely damaged the development achievements of Southeast Asian countries over the years, and that he is the culprit of Southeast Asia..."

……

A week later,
Central Plaza, top floor.

Guan Zu looked at the weekly chart of the Hang Seng Index on his computer screen, feeling both amused and exasperated.

The curve on the screen was zigzagging, and after a week, the cumulative drop was only 1%+, not even touching the 2% mark.

"That drop...isn't it too small?"

He switched to the daily chart, looked at the minuscule fluctuations each day, and couldn't help but shake his head:

"Soros and his gang are probably furious."

"After a week of hard work, this is all?"

Think back to Southeast Asia back then, where prices could drop by more than ten percent in a single day, let alone a week. But in Hong Kong, retail investors were unfazed. They bought what they wanted and held what they wanted, and there wasn't even a hint of a large-scale panic sell-off.

"Citizens, aren't you being way too cautious?"

"I still want to go fishing, how can I go fishing now?"

He then opened the data interface of the foreign exchange market.

Although the Hong Kong dollar exchange rate against the US dollar has fallen considerably, it has remained firmly within the safety line set by the Hong Kong Monetary Authority.

"Having large foreign exchange reserves gives us more confidence..."

"However, this situation is unlikely to attract large sums of money from Soros's speculative capital."

Guan Zu was a little worried.

……

"In this situation, we can't fish..."

"It might scare the fish away."

Financial Affairs Department, Director's Office.

After seeing how the stock market performed, the director was also a bit of a headache.

Good news: The public is calm and there is little danger on Hong Kong Island.

Bad news: It's easy to fail at phishing.

He remembered what Guan Zu had said on the boat: when fishing, you must use bait.

So he summoned the head of the Hong Kong Monetary Authority.

"Minister of Finance!"

"Officer Ren, there's something I'd like to ask you..."

"Please speak, Mr. Finance."

"Could we slow down the absorption of international Hong Kong dollars?"

The head of the Hong Kong Monetary Authority was taken aback.

"Master Cai, I don't understand what you mean..."

The Financial Secretary tapped his fingers on the table, carefully choosing his words, and said, "Mr. Yam, look at the market these past few days. International speculators are dumping Hong Kong dollars, and we're buying them up. The exchange rate has stabilized, but their losses haven't been painful enough, and their probing intentions haven't stopped."

"It's like fishing. If the fishing rod is always too taut, the fish will know there's a pull and won't bite hard. You have to loosen the line so it feels like it has a chance before it dares to swallow the bait."

Mr. Ren frowned slightly: "Does the Financial Secretary mean... to deliberately let the exchange rate drop a little? However, the bottom line of the linked exchange rate system cannot be broken. Once the market feels that we cannot hold it and panics, the consequences will be unimaginable."

“It’s not about crossing the bottom line.” The Financial Secretary shook his head. “It’s about slightly easing the pace of absorption within the safe range we’ve set, letting them dump their shares and letting the exchange rate dip a bit, but without crossing that red line.”

"Make Soros and his ilk think that the Hong Kong government is rather timid when it comes to foreign exchange, or that we are struggling a bit. Let them see 'hope' and feel that they can break through the defenses with a little more effort—only then will they put more chips in."

Mr. Ren paused for a moment: "This is probably a bit risky. Market confidence is as thin as paper. The slightest disturbance can cause retail investors to panic, and if things get out of control..."

“So we need to strike the right balance,” the Financial Secretary said. “The Hong Kong Monetary Authority needs to be prepared in secret to intervene immediately if the exchange rate approaches the red line. On the surface, we need to make them think we are ‘powerless’…”

He stood up, walked to the window, and looked at the bustling traffic below: "In Southeast Asia, they won by striking while the iron was hot, relying on market panic. But Hong Kong is different; the people have confidence, which is our strength. What we need to do now is to feed their greed even more, until they've staked everything on this..."

Then, clench your fist!
"Close the net again."

Mr. Ren pondered for a few seconds, then slowly nodded: "I understand. I will have the team adjust their strategy..."

"Thank you for your hard work, Inspector Ren."

The Financial Secretary raised his hand and patted him on the shoulder.

"This move is risky, but I have confidence in the people of Hong Kong Island... As long as we hit those international speculative funds hard once, no one will dare to run wild in Hong Kong Island in the future."

"This is a rare opportunity for Hong Kong to make a name for itself since the island's return to China!"

Upon hearing this, Inspector Ren thought it made sense.

Moreover, if he wins, he will become famous overnight!
By the way, it was he who suggested that the Hong Kong Monetary Authority be established by the British Hong Kong government.

(End of this chapter)