"Okay, thank you very much for your reminder and help, and I also thank your country for your sincere assistance on behalf of the Thai people......"

Bangkok, inside the Bank of Thailand.

Governor Sunny was chatting with the head of the Monetary Authority of Singapore, Lee Xian Chong, on the phone.

Sonny's tone was very humble, and there was a heartfelt gratitude on his face, completely ignoring the fact that the two sides were equal in position.

My family knows my own business.

Sonny's ability to become the governor of the central bank does not depend entirely on the power of his family, and he still has real materials in his understanding of finance.

As the governor of the Bank of Thailand, he is well aware of the crisis Thailand is facing.

Since the Mexican financial crisis in January 1995, international capital has been targeting emerging market countries.

JPMorgan Delta, Citigroup, Goldman Sachs and other investment banks, as well as Soros Fund and Tiger Fund, respectively launched a tentative attack on the Thai baht in July this year.

On that occasion, the Bank of Thailand, together with the Monetary Authority of Singapore and the Hong Kong Monetary Authority, intervened in the market, and the bears were temporarily repulsed.

The big bears lost about $600 million in losses in the market.

At that time, the Quantum Fund, led by Stanley Druckenmiller, also launched an attack on the Thai baht, but it ended up with a cumulative loss of 70 million US dollars.

The logic of the bears' offensive is that the total circulation of the Thai baht is expanding rapidly, but the Thai government's foreign exchange income generation capacity has shown a rapid downward trend.

To put it simply, the supply of Thai baht internationally is greater than the demand.

Sonny is also very aware of this.

At the beginning of the year, when Sonny attended a conference in Tokyo, a scholar close to Japan's Ministry of Finance brought up a topic in casual conversation.

"If the level of the yen against the dollar becomes 150:1, will the baht abandon the policy of fixing the exchange rate?"

Sonny thought the issue was important at the time, but never realized how damn it was.

In April 1995, the yen peaked at 80:1 against the dollar.

By 1996, there had been a small recovery in the Japanese economy, and the yen was trading at about 104-116:1 against the dollar.

Japan is the largest economy in Asia, while Thailand is the most vulnerable to yen arbitrage forex trading, as 55% of Thailand's external debt is in yen, and Japan is Thailand's largest source of foreign investment.

This is because Japan's GDP alone is greater than that of the rest of Asia combined, and its financial assets are about twice that of the rest of Asia.

As the world's second-largest economy, Japan accounts for about one-fifth of East Asia's trade.

From the late 70s of the 20th century, Japan began to build its global supply chain.

Raw materials were obtained first from Asian countries, then cheap parts were purchased, and finished products were sold mainly to the United States, then to Europe and the rest of the world.

The expansion of manufacturing supply chains is sometimes referred to as the "flying goose model".

Japan leads the way, followed by the "Asian Tigers" (South Korea, Taiwan, Hong Kong and Singapore), then the "Four Tigers" (Thailand, Malaysia, the Philippines and Indonesia), and finally Chinese mainland.

Within the system's supply chain network, there are two currency standards: the US dollar and the Japanese yen.

In September 1985, the Plaza Accord strengthened the yen and the euro in international markets.

In less than two years, the yen rose from 240:1 against the dollar to around 120:1 in December 1987.

By 1990, Japan's real estate and stock markets, fueled by banks, had created a huge bubble. The Plaza Accord led to the yen's overvaluation and subsequent pullback.

The excessively high yen led Japan to invest heavily in the U.S. stock market, partly contributing to the 1987 U.S. market crash.

In 1989, the market value of real estate in Japan was estimated at about $24 trillion, four times the market value of land in the United States, and Japan's GDP was only 60% of that of the United States.

After the bubble, Japan had to change the direction of the country's overall strategic investment, and a large amount of yen began to flow from Japan into the emerging Southeast Asian market countries under the dominance of zero interest rates.

But two things happened after that.

During the January 17, 1995 Kobe earthquake and March 20 to April 19, 1995, the yen began to depreciate against the U.S. dollar after peaking at 80:1.

The earthquake reconstruction program spurred an expansion of infrastructure investment in Japan, and the depreciation of the yen stimulated exports, leading to a modest recovery in 1996.

As the yen weakened, the Bank of Japan began to take advantage of the yen's weakness to collect its overseas loans.

This is going to be fatal.

Fifty-five percent of Thailand's external debt is in yen.

With Japan's overseas loans shrinking, it will be difficult to borrow money to repay.

It's like a company.

When the bank suddenly freezes the loan, it can freeze a company alive.

Thailand is like this company, and when the Bank of Japan contracted its credit scale, it immediately suffered.

What's worse is that.

Previously, the world's major central banks believed that the United States would continue to raise interest rates.

Because U.S. interest rate policy tends to be cyclical.

Unexpectedly, Fed Chairman Alan Greenspan persuaded his colleagues to start raising interest rates by ending the dollar rate hike and lowering interest rates.

This means that the U.S. interest rate hike cycle is over and it may enter a rate cut cycle.

If interest rates are cut, the return on money deposited in the bank will be reduced, and it may even be reduced to the point that it cannot keep up with inflation.

Against this backdrop, those who are sleeping in the bank will be forced to flow out of the bank.

Capital is always profit-seeking.

When a large amount of capital flows out of the banks, it will inevitably push the US economy stronger.

The U.S. stock market has reflected this well.

In the century-old economic law of the United States, the characteristics of the stock market as a barometer are very obvious.

After the Fed's interest rate decision, the Dow Jones and Nasdaq began to enter an upward trend, and the real estate industry, which has been cold in the United States, began to recover.

Where there is income, there is investment.

With visible returns, global capital began to flow into the United States, further driving up the dollar's prices.

The consequence of this is that capital in Thailand can also begin to speak of the outflow of baht assets into US dollars.

If that's all there is to it, the pressure on the baht isn't that great.

To add insult to injury, the yen suddenly announced an interest rate hike at this juncture.

Standing in the position of the Bank of Japan, there is certainly nothing wrong with raising interest rates.

Japan's economy in the past six months has picked up for the first time since the bursting of the bubble in Japan's real estate industry and stock market.

This is a sign that Japan's domestic economy is improving.

If the yen raises the interest rate, it can drive some of the yen back to invest in the country.

In addition, the active depreciation of the yen can also improve the global competitiveness of Japanese products.

As the second largest economy in the world.

Japan has a power far superior to that of other countries in the fields of high technology, modern industry, and agriculture.

Otherwise, it is impossible for a single company's total annual exports to surpass the export volume of the entire country.

With this competitiveness improving again, Japan's life will be much better.

The U.S. economy is strong, the U.S. is doing better, and Japan is shrinking the scale of overseas investment and improving the competitiveness of its exports, and Japan is also having a better time.

But if they are better, others will have a hard time.

Wealth creation is only in some monomers.

Once you look at the whole picture, wealth is in fact always a process of exchange.

Under the strength of the US dollar and the contraction of overseas investment by the yen, it is undoubtedly equivalent to digging a big hole for emerging market countries in Southeast Asia.

Thailand, in particular, immediately became the most stressed country.

Thailand's economic development is mainly driven by overseas capital.

Now these capitals want to exchange Thai baht assets for US dollars and withdraw funds, which is tantamount to pumping the blood of the Thai government.

Japan's strategic adjustment and the contraction of overseas investment are forcing Thailand to repay its debts.

What's even more pitiful.

Thailand used to earn some foreign exchange by selling agricultural products, low-grade processed products and jewelry at a fixed exchange rate.

The depreciation of the yen has greatly affected Thailand's export industry.

In just six months, Thailand's export revenues have fallen by nearly half.

The way to make money is to open up sources and reduce expenditure.

Now the situation in Thailand is reversed.

The United States draws blood, Japan asks for debts, and the things at home are so suppressed that they can't sell them.

Life must have been very difficult.

If that's all there is, you can get through it with a little support.

In the past 20 years of development, Thailand has also accumulated a lot of family foundation.

In addition, there are two strong allies, Singapore and Hong Kong, as long as they survive this time, they can think of other ways in the future.

When ASEAN's influence expands in the future, with Thailand's position in ASEAN, it can slowly make up for the hollowing defects left by the rapid development of the past 20 years.

But who knows that people are not as good as heaven.

When the Thai government was making a good calculation, the Burmese government dug a hole in the back quietly.

The big drug lord Kunsha has been selling drugs for many years, and all those drugs are sold to the United States and Mexico.

All you earn is dollars.

After reaching an agreement with Khun Sha, the Burmese government refused the U.S. government's extradition of Khun Sa in order to gain the support of the dollars in Khun Sha's hand.

This has given the U.S. government an excuse to impose economic sanctions on Myanmar.

As a neighbor of Myanmar, everyone would have thought that Thailand would also be affected.

In July, international capital made a tentative attack on the baht, although it was repulsed on one occasion.

However, the group behind these capitals has never stopped singing the Thai baht in the international arena.

As you can guess with your ass, these capitals are still looking for an opportunity to carry out the next attack on the baht.

For this reason, Sonny, the governor of the Bank of Thailand, has been worried.

If the Thai baht is not finished on the day when ASEAN's influence expands, then Thailand will replace Hong Kong as Asia's financial center, and it will be beaten overnight until decades ago.

It's just that no matter how hard the defense is, there will always be a day when there will be a loophole.

Ants bite elephants to death.

Even the most powerful British Empire at that time was destroyed by the repeated attacks of international capital, not to mention Thailand.

It is true that Thailand raises elephants, but Thailand's comprehensive strength is probably an elephant's leg.

If you really want to be targeted by international capital, you will have to bite twice a day, and domestic capital will continue to flow out, if it goes on like this, you will have to be consumed alive sooner or later.

So, Sonny hated his neighbors so much.

Distant relatives are not as good as close neighbors.

Myanmar, a neighbor, is a good neighbor, and for the sake of the dollar in Khun Sha's hand, regardless of the overall situation of ASEAN, he quietly dug a hole behind his back.

And then....

Jointly imposed economic sanctions by Europe and the United States, the Burmese dollar collapsed on its own without the need for international capital attacks.

In this case, the situation in Thailand must be worrying.

A pit is connected to a pit, and outsiders dig pits and neighbors dig pits.

As long as those international capitals are not stupid, they will definitely seize the influence of Myanmar to launch another attack on the Thai baht, and when the domestic foreign exchange reserves are exhausted, Thailand will have to be buried alive by these pits.

Sure enough.

Sonny judged that international capital would seize the opportunity of the collapse of the Burmese to attack the Thai baht, and it was fulfilled the next day.

Immediately in the spot market, billions of baht were sold, and futures contract positions in the forward financial markets began to increase rapidly.

BOT can catch a one-day sell-off and a week-long sell-off.

But if it continues to be carried out, it will not be beaten to death by those international capitals.

As the governor of the Bank of Thailand, Sonny knows both his own background and what the herd effect is.

Once the front can't be stopped, the back toss will drown Thailand like a tidal wave.

Even the Bank of England can't withstand the tide, and once the gap is really opened, Thailand will definitely not be able to withstand even ten more allies.

After thinking about it for a long time, Sonny had to turn to his ally, the Monetary Authority of Singapore, for help.

Although Thailand wants to compete with Singapore, Sunny also has to admit that Singapore still has more experience in finance than Thailand.

This is also the reason why Sonny is grateful to Li Xianchong.

In Sonny's request for help, the chairman of the Monetary Authority of Singapore, Li Xianchong, considered it and gave Sonny a good solution.

As Singapore's Deputy Prime Minister and Chairman of the Board of Directors of the Monetary Authority, Lee Hsien Chong has certain philosophical, economic, and military views.

He knows that with the current situation in Southeast Asia, once the Thai baht fails, Singapore may also become the target of international capital attacks.

Li Xianchong already had a faint sense that on the ASEAN issue, the US Government would certainly not give up on its laurels.

The temptation of the Thai baht by these international capitals has not been without the United States and Japan making small moves behind the scenes.

Everyone knows that once ASEAN's influence expands, it will have an impact on the world economic structure.

As the first and second largest economies, no one wants their place to be threatened.

Li Xianchong thinks.

The soldiers came to block the water and cover the earth, and that was when the strength far exceeded the opponent.

With the amount of foreign exchange reserves that Thailand currently has, it will be very passive if it really wants to compete with international capital for a long time.

Now all the countries in Southeast Asia are pits.

If someone else digs a pit, they can only pass it on.

A thousand days to prevent thieves, that will definitely not be prevented.

Only by killing those fierce capitals to the cold can we scare off those fierce beasts who want to eat meat at the right time.

Finally, Li Xianchong made a suggestion.

Show the enemy to be weak and lure the enemy deeper.

(A friend suggested that I get an anti-theft chapter, but Lao Yu didn't want to affect everyone's reading, to be honest, no buying and selling, no killing, look at piracy infringes on the author's hard work and pay, how many authors are forced to the womb because they have no income to pay, so please also support the genuine version, all see that the pirated author will really starve to death...... ，）

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