"Isn't Ford still squirming and pinching, so don't worry, let's go to the U.S. capital market and short Ford's stock a little bit by the way, and add a little chaos to them," Jiang Hui said.

If history does not change, affected by the U.S. subprime mortgage crisis, the U.S. stock market will fall all the way from October 2007 to November 2008, in just over a year, the Dow Jones index fell from a high of 14,279 points (October 11, 2007) to a low of around 7,800 points (October 10, 2008), a decline of 45%.

For the majority of shareholders, this is a huge disaster, but for Jiang Hui, this is a historic opportunity, missed, maybe there will never be such a good time in this life.

When others are greedy, you need to be afraid. You need to be greedy when others are afraid.

When the financial crisis came, everyone, including those veteran drivers in the investment world, was terrified.

Of course, companies with high leverage or less competitiveness should be feared.

Greed is not a good word, and it is a very difficult thing to be greedy when others are afraid.

Because most people are afraid, there must be a reason. For example, giants have collapsed, even the president seems to be in a hurry, major companies have begun to lay off employees, and the headlines in the media are all "the end of the world", and so on.

In this case, the Korn Ferry Group and a small number of enterprises with strong psychological qualities are able to remain greedy.

Don't say that shorting Fannie Mae Mortgage or Lehman Brothers, a giant destined to fall in the economic crisis, is this predator such as Google, Microsoft, and Yahoo, and if you short them at this time, you can definitely make a lot of money.

"Mr. Jiang, are we going to attack again?", Guan Weidong said with a twinkle in his eyes.

Since July this year, the Guanghui Investment and Finance Department has basically stopped investing in the stock market of the Celestial Empire, and although overseas oil futures have started to move again in September, the magnitude is far less than before.

Now that Jiang Hui has expressed the intention of making a few big moves, Guan Weidong is naturally very excited.

"Since the U.S. stock market peaked in the middle of the month, it has been going down, and I don't think there will be a fundamental change in this downward trend in the coming year," Jiang said.

"So Mr. Jiang is going to short the U.S. stock market?"

"Short the U.S. stock market? Big brother, you think too highly of me. Although it is close to $10 billion, it is still 108,000 miles away from shorting the US stock market," Jiang Hui said with a smile.

As the world's largest stock market, the U.S. stock market is definitely not something that can be easily leveraged by a single person or company.

In 2007, the market capitalization of the top 10 companies in the United States reached $2,682.5 billion, not to mention that there are countless companies behind.

This understanding, where is it that someone can easily move?

"Then Mr. Jiang, what do you mean?", Guan Weidong continued to ask.

"We pick a group of stocks with inflated stock prices and short them," Jiang said.

Shorting refers to the expectation that the market will fall in the future, sell the borrowed stock at the current price, and buy it back after the market falls, so as to obtain the profit from the price difference.

Its trading behavior is characterized by selling first and then buying. It's actually a bit like the open money trading model in business.

This model can make a profit in the swing of falling prices, that is, borrow goods at a high price and sell them first, and then buy and return them after the price falls.

For example, if you expect a stock to fall in the future, borrow the stock when the current price is high (the actual transaction is to buy a put contract) and sell it, and then buy it when the stock price falls to a certain level, and return it to the seller at the current price, and the resulting price difference is the profit.

Specifically, let's say you're an investor and want to short sell 100 shares of a bank at $20.

At this point, you contact your broker to lend you 100 shares of the stock and sell it immediately.

This gives you $2,000 in your account, even though the funds are frozen.

Because you don't own the stock, you still need to buy back the same number of shares in the end.

Just wait until the stock price falls, because short selling is a bet that the stock price will definitely fall.

Let's say Citibank's stock price fell to $15 after the release of a loss-making Q3 earnings report.

You buy 100 shares for $15 to return the shares you borrowed and $1,500 to the person who originally lent you the shares.

Because the profit from a short sale is the difference between the price of selling and buying an investment. In this example, you sell Citi stock for $2,000 and buy it for $1,500, making a profit of $500 by shorting the bank stock.

Of course, with a certain amount of funds, you borrow money from institutions to sell stocks short, and these funds need to pay high interest, and other institutions mainly earn this interest.

So you will actually get a little less profit than $500.

"Shorting? We can use the funds on hand to short hundreds of billions of dollars in stocks," Guan Weidong said.

"Leverage does not need to be increased too much, the current stock market volatility is more intense, although the general trend is down, but there will definitely be a rebound in the middle, if the leverage is too high, the rebound to liquidate the liquidation, it will be a tragedy," Jiang Hui said.

"Besides, even if we are lucky and don't encounter risks, we will be able to leverage nearly $10 billion, and with high leverage, we can leverage $200 billion, which is too big. Don't be denied a hat when you turn around, it's dangerous," Jiang Hui continued.

No matter which country's government encounters a major accident, it hopes to find the culprit, at this time, as long as it is a little similar, it will be targeted, and if you are not careful, you will be sacrificed to the flag and whipped the corpse.

There is still a long way to go for the future of the Korn Glory Group, although high leverage can make more money in the economic and financial crisis, but compared with the future of the companies under the Korn Glory Group, Jiang Hui still looks more at the latter.

"Then I'll go short with five times leverage first?", Guan Weidong said a more conservative data.

"You can play like this for two months, and then adjust it depending on the situation," Jiang Hui said.

"Okay, Mr. Jiang, do you have any companies that you want us to short, except for Ford Motor," Guan Weidong said.

"Financial stocks, Internet stocks can be, in the past ten years, financial stocks are the most popular on Wall Street, the fastest rising, the extremes must be reversed, this round will definitely fall very badly.

As for Internet stocks, although the valuation of Internet stocks has been much more rational since the last Internet bubble burst, the Internet is inherently relatively empty in valuation, and it is basically inevitable that they will be wrongly killed in the crisis. What kind of crisis is there that there are not a few unjust ghosts?", Jiang Hui said.

"Okay, then I'll arrange it right away, let's let the Ford people calm down first," Guan Weidong said.

……

(End of chapter)