American Fortune Life

The U.S. stock market is getting weirder and worse, and there's no law to follow, and any rumor on Wall Street could even cause stock market turmoil.

Badstone knows very well that this is the result of widespread anxiety in the market, where everyone feels something is wrong, but they all find out exactly where the problem is, which is why this anxiety and anxiety, or suspicion, becomes more relevant.

“Boss, our massive acquisitions of cheap CDS on the market have caught the attention of some people, some people have even come to the company to get the news themselves, and although some people have some doubts, ABX (Real Estate Subprime, so-called Short Loan Index, which is the need for this index to fall dramatically) is still stable, Standard & Poor's has not lowered the rating of CDO, and the price of CDS is now very cheap, but some concerns have arisen in the market. ”

After Budstone gave an update, Andy looked at the detailed data on the table, the CDO of the debt mortgage bond and the CDS of the credit default swap. The relationship between the two products is that the higher the risk of CDOs, the higher the CDS value guaranteed for them. But during the real estate boom, CDS prices were very low because most people didn't think CDOs were risky.

And what Andy's doing now is, while he's running out of dangerous CDOs, buying cheap CDS.

Andy closed the file, curling his mouth with a smile, seemed ironic and happy, "The whole world is in a false carnival, and a few outsiders and geniuses may have their own eyes. Investor greed, banker greed, once sitting on Wall Street, greed becomes what it should be, almost an obligation.

Isn't there really a smart guy here? No, it's a weird circle. The closer you get to the market, the harder it is to spot its stupidity!

What we're doing now is trading in bonds and gambling, and the line between gambling and investing is artificial and very fine. The most robust investments also have a certain gambling nature, while the boldest speculation also has a distinct investment character. Perhaps the best definition of "investment” is “gambling where odds are good for you”.

“Oh, boss, our investment this time is no smaller than that of some Wall Street investors, even Facebook shares have mortgaged 200 million dollars, we now hold 700 million dollars CDS, 200 million dollars empty CDO, 150 million margin exists * * * *, use the interest generated to cover the losses, once the real estate collapses, boss, you will create a new wealth myth!” Alvitelli's admiration for Andy's courage comes from the heart, which is a huge bet on almost all of his family.

Al's words, let the people in the conference room look hot at Andy. After all, all the people sitting here for a while have been busy studying around the real estate market. There is no doubt about the collapse of the real estate market, and the myth of wealth creation by the owner is only a matter of time.

“Oh, this is inseparable from your work during this time, I'm not a stingy person, you'll get good bonuses and plenty of time off for hard work during this time.” Andy is very clear about what his people think, and he is not a stingy person. Mixed Wall Street is just a huge bonus. The annual salary is not really high enough to avoid the attention of the government.

The rigorously held Wall Street JING Englishmen did not have a messy cheer or whistle, just a cheerful clap.

“Oh, how do you make me feel, it seems like the winning ticket is in hand. For everything to go smoothly, I want everyone to work hard, and I want everyone to work hard. We will witness miracles and a change in the world economy in the years to come, and I want you to stay together, because this is my chance and your chance to realize your self-worth!” Andy had the opportunity to paint a brilliant future for everyone, and it was definitely most appropriate to drive them on Wall Street with profit.

Waiting for the delightful crowd to leave, there were only Budstone and Alvitelli left in the conference room, and Li Xiaoying, who had been deliberately called down by Andy.

“Al, what time does your think tank expect the first domino to fall?” Andy turned his signature pen in his hand and looked at Al more casually.

“The ideal scenario is for three major rating agencies to downgrade MBS (Mortgage Securities), unfortunately this is hard to come by, 3A!” Al shook his head with a ridiculous smile on his face.

“Can't the three rating agencies really see the risk of a real estate bubble?” Andy frowned slightly, I really don't understand that the world is very famous, and the three great rating agencies will be confused about the changes in the market. There is Standard & Poor's here, even ordinary people in the rabbit country have heard the name of this professional company.

“In fact, the three major rating agencies are also masked, and the ratings they give are based solely on what traders want to show them and on their own common sense.” Budderstone smiled and confused Andy.

“What do you mean?” Andy's a little curious.

“The Wall Street Investment Bank bond traders are all seven-digit people who fool the five-digit annual income guys (employees of rating companies) more than enough. In fact, the best employees of rating companies jump into investment banks to help their new hosts deal with their old hosts.” When Budstone saw that the boss didn't seem to believe the reason, he gave the boss another simple example of deception.

Simply put, half of the borrowers with high ratings and the other half with low scores are purposefully placed in an MBS, and the score is just over the 3A standard line, and the likelihood of that half of the borrowers with low scores losing their supply is very high.

“Another of the most important reasons is that their biggest basis is that since the Great Depression, there has never been a simultaneous decline in house prices across the country. They feel that the borrower doesn't pay the loan yet, and then they get the house, and for MBS, they're so relieved to give AAA ratings. ”

Andy's eyebrows stretched out, which is a very solid reason, "Since we can't count on a rating agency, where do we begin to fall the first bone card? ”

“After analyzing all the publicly available information, the second quarter will see a peak in repayment, and a massive supply cut-off will occur, that is, in April, starting with the bankruptcy of a lending company, the Domino effect will start to explode the real estate bubble in the United States, and then our CDS will start to make money, and as for CDOs, we will have to face the death of our opponents, but it won't take long. ”

Alvitelli's arms spread apart, casually placed on the conference table, confidently gave the boss the answer he needed, which is also the value of their think tank, otherwise, why does the boss pay for them?

Andy laughed with satisfaction, his tall, strong body resting on the boss's chair, and he couldn't wait for April.

“By the way, Al, there's one more thing you need to work with, Emily, and you need Emily to be in charge of getting in touch with the Graham family and completing the acquisition of Newsweek. ”

“Oh, my God, this is incredible, boss. You're buying Newsweek?” Al couldn't help but be surprised.

Budstone and Li Xiaoying also looked at Andy with surprise. After all, Newsweek was too influential to be comparable to the previous regional weekly, Observer.

“Yes, it is basically certain that I will own this weekly magazine and the acquisition price will be one dollar... ”

With a delightful smile on Andy's face, his footsteps became light and he remembered the silly look of the three people in the conference room. He couldn't help but have a dark look, accompanied by his faint disguise and forced expression, and the three of them worshipped directly.