What is Wall Street?

Or what does Wall Street represent?

Wall Street is just the name of a street in the southern borough of Manhattan in New York City, no more than a mile long and only 11 meters wide, but it is home to some of the major financial institutions in the United States. Pen × fun × Pavilion www. ｂｉｑｕｇｅ。 ｉｎｆｏ

Wall Street is lined with skyscrapers long ago, and the streets are like canyons, and you can only see a glimmer of heaven when you look up.

Countless big banks, trust companies, insurance companies and stock exchanges are here, and thousands of white-collar workers flock here every day to get to work, while the financial magnates living in the suburbs don't have to suffer from traffic jams, they commute to and from work, and their heliports are located on the banks of the East River, not far from the east end of Wall Street.

Wall Street is the center of finance and securities trading in the United States and the world, and generally speaking, Wall Street is generally synonymous with monopoly capital, and monopoly capital dominates the politics and economy of the United States from here, and Wall Street has become a symbol of the high concentration of monopoly capital, finance and investment in the United States......

So, what's Wall Street's favorite thing to do?

What Wall Street likes to do most is to use complex concepts to make people feel that only they can do certain things, so that they can enjoy high salaries, privileges, flouting rules, and determining the rules and how the game is played.

Then the problem arises.

In the face of such a group, in the face of these opponents who are all large and greedy, what kind of solution can he come up with?

Liu Meijia knew that she couldn't think of it.

She knew that in the current situation, she could not think of a solution to the crisis without bowing to Wall Street.

You can't rack your brains......

Liu Meijia felt that she was useless.

As the manager of Bayside Securities and Jiamei Bank, she couldn't think of an effective way to weather the crisis......

Liu Meijia's entanglement and chagrin were not noticed by Fu Zhengyi.

Because he's thinking about something.

That is, if there really is a Pandora's box in the world, and it is still in his hands, in the current situation of Wall Street's aggressive and Melial's Star America Bank is frantically shouting, should he open the box and release the disaster?

If it had been three months ago, Fu Zhengyi might have dispelled this idea without too much consideration.

But now?

has just barely come out of the pain of Sophia's death, but it needs to face the encirclement and suppression of many forces led by Wall Street, and even regional banks like Star American Bank dare to become the vanguard of Wall Street and try to make extra money from him, which is tolerable and unbearable!

Since Wall Street wants to make trouble, don't blame it for doing things desperately......

Thinking of this, Fu Zhengyi raised his head, and when he saw Liu Meijia in a daze, he patted her hand and asked. "Payday loans, are you familiar with this business?"

"Payday Loans......?"

responded blankly, but Liu Meijia came to her senses immediately after. "Isn't it? You want Jiamei Bank to do this kind of business?"

Now that she knows about this business, it is much easier to communicate, Fu Zhengyi asked. "Why? Don't American banks do this?"

Liu Meijia recalled the content of this business, and then explained. "This business is only carried out by those small institutions or regional banks, although the interest rate is relatively high, but the risk is also quite large, if you consider the high cost of collection, then the final profit is not as high as imagined......

After Liu Meijia finished explaining, Fu Zhengyi continued to ask. "Let's not talk about the negatives, let me ask you, under the condition of safe capital, how much can the compound annual interest rate reach?"

"There should be thirty or forty, right?" Liu Meijia was a little surprised to see Fu Zhengyi after speaking, and hurriedly added. "However, the risk is too high, if the lender loses his job, or is unable to repay when due, the bank faces the risk that the principal cannot be recovered, and at present, traditional banks do not have this business at all, and many problems such as high bad debt rate, collection troubles, and amazing collection costs are ...... that traditional banks cannot solve."

Fu Zhengyi waved his hand indifferently. "If Jiamei Bank provides this service, will it be able to scale up the loan quickly and avoid the accountability of the regulators?"

"It's difficult! Those customers who don't have a high salary and no collateral but have a bad turnover are quite in need of this kind of loan, but the overall scale is not large......"

"Since there is a demand market and potential customers, and it is a business that traditional banks are unwilling to operate, isn't it just right for Jiamei Bank to intervene?"

Seeing that what he said was so simple, Liu Meijia couldn't help but laugh and cry. If this kind of business is easy to do, how can traditional banks not do it? Wall Street banks alone have as many as thousands of market researchers, and every year Wall Street banks develop hundreds of new products, if this kind of loan is profitable and the banking industry has already been fully developed, where can Jiamei Bank participate?

Fu Zhengyi didn't understand what she wanted to say, and raised his hand to signal her to continue.

Once the bad debt rate soars, it will not only endanger the capital, but also cause the bank's reputation to be damaged, and if the collection process is outsourced, it will lead to many legal problems......

"Then raise the interest rate on loans! Doesn't the United States allow floating interest rates?"

Liu Meijia smiled bitterly. "But the problem is that the bad debt rate will be very high, and the current annualized interest rate of thirty or forty is already very high!"

"You know what it means to have an equal principal amount involved in a residential mortgage, right?"

Liu Meijia rolled her eyes directly. "Are you kidding me? No matter how stupid I am, I know what it means, okay?"

"One of my suggestions is to start a payday loan. The lender has the expected salary as collateral, and the compound annual interest rate is raised to two hundred or three hundred, which will be able to make up for the loss caused by the bad debt," Fu Zhengyi saw Liu Meijia's eyes widen and a shocked look, so he raised a second finger. "The second is to increase the bank's loan income by using equal principal loans!"

"What does the second mean?"

"For a simple analogy, the current loan interest rate is assumed to be 10 percent, and the customer receives a one-year loan from the bank for a total of 10,000 US dollars, and when the year matures, the customer repays the principal and interest to the bank in a lump sum. But if the customer is asked to repay $1,000 in principal and $80 in interest every month, then what is the compound annual interest rate of the last loan?"

Liu Meijia was a little puzzled, but she still took out the calculator and started calculating, and exclaimed without waiting for the calculation to be completed. "Oh my God, how can this be?"

"If you take the last instalment, the interest rate of this loan is as high as 96 percent per annum! And the key point is that the risk of the bank is gradually reduced......

Liu Meijia looked incredulous. "Oh my God, if we were to implement the current floating interest rate for small commercial loans, wouldn't we be able to get two or three hundred percent of the return?"

Liu Meijia's calculation is correct, but this business can only be realized by relying on the customer base, so Fu Zhengyi noticed that this kind of business did not seem to be very suitable, and smacked his lips. "The higher the risk of customers, the higher the interest rate they need to bear, but this method will soon be adopted by other banks, but the customer base of Jiamei Bank is relatively small, this method is not recommended to be carried out immediately, or wait for Jiamei Bank to have more customers before considering it......"

Liu Meijia couldn't help but be stunned, and after thinking about it, she understood what he meant.

The ability to imitate business between the banking industry is super strong, as long as Wall Street financiers find it profitable, then they will definitely start this business immediately, so it is better not to rush this kind of loan before Jiamei Bank expands its scale.

felt that the two methods he said were not particularly useful, and Liu Meijia was a little frustrated. "Justice, I remember that the total scale of payday loans is only more than a billion dollars, and it is shared by many regional banks and thousands of lending institutions......

Listening to Liu Meijia's introduction to the current pattern of the U.S. financial market, Fu Zhengyi had a headache. "This is not good, that is not possible, we have to let Jiamei Bank deeply involved in the competition of residential loan mortgage and participate in the transaction of financial derivatives such as credit default swaps!"

Liu Meijia became more and more surprised. "Credit default swap? This is a product developed by JPMorgan Chase, although the overall scale is still objective, but it is equivalent to a bond-type financial product, the risk is almost none, but the profit is also very low!"

Fu Zhengyi believed that Liu Meijia understood what a residential loan mortgage was, and also knew what type of financial derivatives a credit default swap was, so he thought about it. "Now, let me give you an example. There is a person who plays blackjack in a casino in Las Vegas, his cards are very good, and the probability of the dealer winning is very low, so there are two people who want to bet on this game in the way of 'over-the-counter trading', so this kind of 'betting on the winner or lose' of the over-the-counter gambling game makes the gambling game that has no leverage have leverage, if someone packages the risk and sells it to other participants, then the leverage ratio will be higher and higher, and the potential benefits will be more and more, understand?"

Liu Meijia thought for a long time before digesting what he said, but the new question made her frown. That is to say, taking the original 21-card game as an example, the bank has developed new financial derivatives, which continuously expands the range of participants in the form of leverage, and finally realizes the bank's income increase, while the risk is passed on to the third party and the fourth party......