Chapter 39 Sudden Interest Rate Hike

Judging from the attitude of French President Jacques, he gave Zhou Ming a very good start, but when Zhou Ming arrived at the Triumph Building and saw Joros, he had to sigh what it means to be lucky and evil, and he was still happy too early. Pen @ fun @ pavilion wWw. biqUgE怂 ļ½‰ļ½Žļ½†ļ½

Originally, according to the normal habits of the students in the finance class, they would definitely come out to greet Zhou Ming when he came back, but this time when Zhou Ming got off at the gate of the Triumph Building, there were only Ye Ning and Li Yang waiting here, and they were all frowning, looking very anxious, it seemed that something unexpected had happened.

"Teacher is not good, the situation on the Mexican side has changed, Joros and the other students are operating the Quantum Fund and other fund transfers, so we are the only ones here to greet you as a representative, for which we are very sorry!"

Ye Ning ran up and apologized directly to Zhou Ming, for her apology, Zhou Ming was both unexpected and expected, after all, it can only be a matter of Mexico that can make them think about it so anxiously now, but the problem is that Zhou Ming remembers that Mexico's economic crisis began in 94, and before that, although the Mexican economy was not all the way forward, at least it was still nothing.

Facing Zhou Ming's doubts, Ye Ning said to him: "Teacher, what is the specific matter, I will not explain it to you clearly for a while, in short, it is very complicated, Mr. Qiao Ross also wants to ask you to go up first and then make a decision." ā€

Li Yang also echoed Ye Ning and said, "Yes, teacher, Mr. Joros said that the situation this time is very strange, but one thing is certain, that is, the situation on the Mexican side will become more complicated. ā€

Zhou Ming knew that the two of them would not be okay to play this kind of joke on themselves, so he followed them upstairs, and soon they came to the office rented by Joros, and when they walked into the office, Zhou Ming saw a row of computers and telephones, and the students in the finance class were sitting in front of the computers nervously tapping on the keyboard and making calls, which made the whole office feel tense.

In such an atmosphere, Zhou Ming was also light-footed, but he still let the sharp-eyed classmates in front of him see it.

Without waiting for them to greet him, Zhou Ming first made a silent gesture to them, whispering to them that he would first go to Joros to find out what was going on, and then a few minutes later, Zhou Ming and Caitlin crept into Joros's office inside.

Qiao Ross jumped up for joy when he saw Zhou Ming coming back: "Mr. Zhou Ming, you are finally back, this is really good! Those French are really idiots, they are almost about to miss our big event!"

"Some things are now in the past. Zhou Ming waved his hand and said, "But more than this, I want to know what happened in Mexico, which actually makes you Joros so nervous." ā€

Joros was stunned for a moment, then shook his head and replied: "It's not what happened in Mexico, it's the Federal Reserve, just half an hour ago, the Fed announced that it would raise the federal funds rate by fifteen basis points, or 0.15 percent." ā€

What Joe Ross said seemed to be very complicated, but Zhou Ming understood it for the first time, which simply means that the Federal Reserve has raised interest rates.

A rate hike of 0.15 percent may sound like a small number, but in fact it is already a very high rate hike.

After all, the Federal Reserve is the central bank of the United States, and it is responsible for the air traffic control of the entire financial and money markets in the United States, and even his interest rate hikes can affect the whole world, so his interest rate hikes must be cautious, if they inexplicably increase or drop by one or even two percentage points, it will be a huge financial turmoil event for the United States and the world.

Zhou Ming and Jo Ross are both engaged in finance, and naturally they both understand the significance of the Fed's interest rate hike, which is to increase the borrowing cost of commercial banks, force commercial banks to raise interest rates along with them, and finally achieve the purpose of encouraging deposits and curbing economic overheating and speculation.

Now, it is clear that the Fed's interest rate hikes will have a huge impact on Mexico.

"Since Mexico has a policy of keeping a tight eye on the dollar, the Fed's sudden announcement of interest rate hikes will inevitably bring huge depreciation pressure on the Mexican peso. Joros told Zhou Ming.

Regarding Joros's judgment, Zhou Ming nodded in agreement, after all, they had also discussed the situation in Mexico at the beginning, and in their judgment, if a financial crisis breaks out in Mexico in the future, it will be in a certain interest rate hike time of the Federal Reserve. So Zhou Ming asked him: "So Joros, do you think the Mexican peso will depreciate in advance?"

Joros shook his head and said: "If it was in the past, Mr. Zhou Ming, I would definitely tell you that it would not be, but now, I really don't dare to draw this conclusion, because the Fed's interest rate hike this time is a bit too strange, although the Fed's reason for raising interest rates is to regulate the overheated real estate market, but in my calculations, the degree of speculation in the US real estate market at this stage is not enough to ask the Fed to raise interest rates." ā€

Zhou Ming thought for a while and then said: "If it's really hard to understand, then put this question aside for now, Joros, the first thing you said was that you would tell me that the Mexican peso would not depreciate, what is your reason?"

"Because the Mexican economy is still in an upward stage, and Mexico is also a country with a high proportion of state-owned economy, the current interest rate hike is only 15 basis points, which is still some way from the upper limit of what the Mexican government can regulate and deal with, and Mexico also has enough foreign exchange reserves, even if the crisis breaks out now, I believe that the Mexican government has the ability to solve it." Joros said.

"So Joros, do you think the Fed's sudden announcement of interest rate hikes this time is aimed at the Mexican economy?" Zhou Ming asked.

Joros shook his head: "I don't know, why is this, I just think it's weird, so I asked your finance classmates to help transfer all the funds together to deal with the economic crisis that may occur at any time, so I didn't go to greet you, I'm sorry." ā€

Zhou Ming waved his hand and told him that Mexico is the most important thing now, and Zhou Ming also said: "Joros, your reaction is very correct, I trust your judgment, and I also believe that this time the Fed's sudden interest rate hike will not be unreasonable." ā€

At this time, Joros frowned, thought for a while, and suddenly said: "This incident happened when you came out of the UK, Mr. Zhou Ming, do you think it could be that the British betrayed you?"

Regarding this question, Zhou Ming thought carefully for a while before shaking his head and said: "The British do have the possibility of betraying me, but the problem is that the Fed's sudden interest rate hike does not seem to betray my reaction, but more like he wants to seize the initiative." ā€

Hearing Zhou Ming say this, Qiao Ross suddenly realized something, and he said: "Mr. Zhou Ming, do you mean that after they learned that you were going to short the Mexican peso, they preemptively used their relationship with the Federal Reserve to do it? These damn bastards, they are really scoundrels who don't have any gentlemanly manners, scum!"

Zhou Ming said to him with a smile: "Joros, don't be busy scolding them, after all, you just said yourself, the Mexican economy is still in the rising stage at this stage, and it is not so easy to fall down, isn't it? Then now they want to strike first, let them test the water first! After they have tried out the depth of Mexico, we will have no problem entering the market." ā€

Joros happily applauded Zhou Ming: "Mr. Zhou Ming, you are so smart! That's right, let those idiots who don't know the so-called help us fight the vanguard, we will wait until the best time to sell!"

"In that case, then we don't need to worry at all, we should collect more short-term Mexican bonds than this, I remember you told me before that once the Mexican economy starts to collapse, then these short-term bonds will be the easiest place to create chaos, right?" Zhou Ming asked.

Joros nodded hurriedly and replied: "Mr. Zhou Ming, please rest assured, nearly half of the funds I am transferring to Mexico now will be used to buy these Mexican short-term bonds, and the rest will be invested in the Mexican stock market." ā€

"This idea is correct, but the situation in Mexico will be different from that of Britain and France, financial powers like Britain and France, they should be much stronger in dealing with currency depreciation, so currency depreciation will drive their stock market growth, but Mexico's stock market, I'm afraid it will also fall with their currency. "And in addition to Mexico's stock market, I think that a collapse of Mexico's economy will cause a greater financial storm throughout Latin America." ā€

Joros said happily: "I think it's the butterfly effect in the financial world, but our butterfly wings are blowing all the way from Mexico in the north to the south!"

......

Meanwhile, at Buckingham Palace in London, Queen Elisabeth listens to a report from her son, the Prince of Wales.

"Dear Mother, although the Federal Reserve has cooperated with our announcement of interest rate hikes, the Mexican government will use its foreign exchange reserves to replace the depreciation pressure caused by the Fed's interest rate hikes, so this time it will not have any effect for the time being. The old butler said.

Hearing this, Elisabeth sighed and said, "It seems that we are still too reckless, although it is only a Mexican, it is still a little difficult to eat completely independently." ā€

Then Elisabeth thought for a moment and said, "Then please call that Mr. Zhou Ming next." ā€

The Prince of Wales was surprised by this: "Is my mother ready to give up?" According to the Chancellor's analysis, Mexico's current economic situation only looks good, and if the Federal Reserve continues to raise interest rates, unless Mexico abandons its policy of keeping a tight eye on the dollar, it will definitely not be able to withstand the pressure of depreciation. And if Mexico abandons its peg to the dollar, it will also lead to a sharp depreciation of the peso. ā€

Elisabeth still waved her hand and said, "My child, you have to understand that what you say is not important, but the problem is that we don't need to do it anymore, unless you don't know what that Zhou Ming did in France." ā€

The Prince of Wales was stunned for a moment, and asked a little incredulously: "Mother, do you mean that the French will also participate?"

"Unless Jacques is an idiot, but by all indications he is not!" said Elisabe, "so we'll leave the problem to the Chinese!"