In order to stabilize people's minds and minds when submitting the 1998 budget, Prime Minister Chai Wali said that he would drastically reduce fiscal expenditures and save every dollar of taxpayers' hard-earned money, and at the same time strive to increase revenues so as to achieve a balance in the economic budget. Pen, fun, pavilion www. biquge。 On June 28, after a heated debate, the National Assembly passed the first reading of the plan by a vote of 217 to 144.

However, the opposition Democratic Party of Japan (DPJ) immediately ridiculed Chaiwalit's optimism, and the DPJ leader and former Prime Minister Chuan Lik's party scoffed at Chawarit's speech and lashed out at his government for spending money everywhere as a typical loser. Alas, a democratic country is good, otherwise these incompetent and incompetent officials will be officials for the rest of their lives because of his incompetence and shamelessness. A crisis of cabinet collapse triggered by the financial crisis is about to erupt, and the opposition parties and the ruling parties are tense.

However, on July 2, when Chawalit announced that the Thai baht would be subject to a floating exchange rate system, and that it was forced to abandon the 15-year-old linked exchange rate system, the opposition Democratic Party of Japan jumped even more happily. The war of words between the two major political blocs is unprecedentedly fierce, from the media to Congress, and from Congress to the masses.

If the loss of the Thai baht was a disaster for the Thai people, then the Philippines was trembling for the next week.

On July 2, the Thai baht was lost.

The Philippine peso is under great pressure, because the Philippine product structure and debt institutions are similar to those of Thailand, and the depreciation of the Thai baht will inevitably bring down the Philippines, and the peso will inevitably be doomed.

On this day, the Bangko Sentral ng Pilipinas (BSP) was on standby to take emergency measures, while the swap rate was raised from a staggering 20% to 32%, raising the running costs of speculators, while the central bank dumped $1 billion in foreign exchange reserves to intervene in the market, but to no avail.

But I don't know what to say about the next behavior of the Philippines! Knowing current affairs, or a soft egg. In short, apart from selling $1 billion of foreign exchange reserves to the market to intervene in the market, the Philippines immediately left it alone and let the market decide the fate of the peso.

And most importantly, the Philippine government did not immediately announce its decision after deciding to ignore the fate of the peso. What's even more fatal is that the Bangko Sentral ng Pilipinas (BSP), the Ministry of Finance, and the government secretly organized a team that suddenly ran away from the previous positions that interfered in the market, and in addition to that, they also changed their direction to short.

The Philippines has been in a deficit in foreign trade for a long time, and its foreign exchange reserves were only $200 million in the 1970s, and in the 1990s, they were only about $2 billion, which was only enough to cover the needs of imports for two months, and was less than the liquidity of a large American company in those years.

However, perhaps the depreciation of the currency is something that the Philippines cannot ask for, because the government often takes measures to devalue the currency in order to alleviate the shortage of foreign exchange and reduce the trade deficit, for example, in 1990 its currency, the peso fell from 28 to 1 to the dollar, and in 1991 it fell to 32 to 1.

In the 1993-1996 period, the Philippines had a current-account deficit of 4.3% of GDP, which is not a small number. The Philippines imports a large amount mainly for the electronics and garment industries, and because of the similarity of the product mix, the lack of differentiation, and the lack of advantages in labor costs, the exports of these industries have not brought any value-added because their raw materials are mainly imported, which offsets a large part of its profits.

On the one hand, the trade deficit is one thing, and on the other hand, like Thailand, the Philippines has financed the shortfall in investment through short-term capital flows, which are large and fast, opening the door for speculators to penetrate the room.

It is precisely because of the above reasons that the Philippine government, believing that it is very smart, has given up interfering in the peso exchange rate market and left it to the market.

Quantum Fund, Tiger Fund and many other European and American capitals smiled happily when the Thai government announced that it would abandon the fixed exchange rate system. As Quantum Fund Manager Stanley Druckenmiller said after the Bank of Thailand announced that he had yielded: "They made a profit!" ”

And there are a lot of profits, just in Thailand, the profit is as high as more than 40 billion US dollars. These profits are made from shorting SET index futures, shorting many stocks, real estate, and other assets. And for some of the big banks, it means that they will once again control a country's financial sector, and they rejoice about it. Even the Central Bank of Thailand, the ruler of Thailand's financial institutions, has a chance to get his hands on it.

In fact, later, because European and American capital wanted to get their hands on some of the power of the Bank of Thailand, and even equity, the IMF's plan to bail out Thailand was put on hold for a while, and it was not until the end of 97 that the two sides finally took a step back.

Review some of the classic battles in which Soros showed their talents: 1. Sniping the pound. 2. Sniper the yen. 3. Snipe the Mexican peso. The objects selected are the British pound, the Japanese yen, and the peso. Of course, Soros has also raided the futures market, such as playing expired copper, gold, and so on. But compared to his reputation for playing exchange rate wars, it is much, much worse, after all, his famous work is still a exchange rate war.

Today, while the sprawling ambition of sniping into Southeast Asia's monetary system has not yet been achieved, it is certain that there is a good start and huge benefits have been made. The European and American capitals led by Soros believe that the Southeast Asian monetary system will be like a bubble under their shock, and they will win an unusually overwhelming victory.

There is no doubt that when the Thai baht collapsed, Soros and other European and American capitals quickly set their sights on the Philippine peso. To be honest, the Philippine government thought that European and American capitals such as the Quantum Fund and the Tiger Fund would come to snipe the peso, but they didn't expect it to be so fast. Thinking of the tragic situation of the Thai baht, the Philippine government wisely chose not to resist.

The inaction of the Philippine peso finally did not lead to the political turmoil of the current government as in Thailand. The Philippines made a scapego for Thailand after the Philippine government unanimously concluded that the Philippine peso was affected by the fall of the Thai baht. The Philippine government's statement is very marketable, not to mention that the Thai government was shot lying down, and the people in the Philippines finally forgave this government. The Philippines is known for its frequent political changes, and none of them has been able to implement coherent economic policies.

To this day, there is still a misconception that the Philippine peso was affected by the fall of the Thai baht, and that the Philippines was the scapegoat of Thailand, when in fact it was not.

On the one hand, the Philippines likes its currency depreciation very much, and in the past it had the habit of depreciating itself at every turn, that is to say, it has a history of habitual miscarriage, and it is not worth making a fuss about another miscarriage; On the other hand, the Philippine currency has been declining for the past 20 years, and it is a popular target, and if you don't attack the Philippine peso, you feel sorry for it. It's just that in the past, if you attacked him, you couldn't get much oil and water, and the IMF wouldn't have spent more than 1 billion to save the market; Third, the Philippines is in line with the third principle of Soros's attack: the political situation is unstable, the regimes of Marcos, Aquino, Ramos and other regimes are frequently changed, and there is no coherent economic policy, let alone such institutions, and its economic problems such as inflation, high foreign debt, high unemployment, and low product competitiveness have never been substantively resolved.

After the outbreak of the financial crisis in Southeast Asia, many economists put forward the "fly" theory, that is, "flies do not stare at seamless eggs", and we should study what "flies" like "eggs with seams". ”

Generally speaking, Soros will not snipe at a hopeless target, the main points are, first, you must be sure of winning before attacking; Second, there must be a lot of oil and water to fish. This is in line with the economics of profit maximization. For example, some poor countries in Africa, some of them have implemented a linked exchange rate system, but why haven't they been attacked? He wouldn't be so stupid as to go to the boiled water to get some kind of oily water. Therefore, the target of its attack requires one: to have money, and if it has no money, to have foreign aid.

In other words, this "egg" is first and foremost a good "egg", and it is a nutritious "egg", otherwise the "flies" will not star. The Philippines, as well as the countries of Southeast Asia, fit well with this "fly" theory.

Take the sterling sniper war as an example, I believe everyone is already familiar with this case.

Once, Soros and Bundesbank President Schlesinger happened to be on the same plane, and they greeted each other warmly. This unexpected encounter may have been carefully planned and arranged by Soros. When talking about the future of European currencies, Schlesinger said that if investors think that the euro is a fixed basket of currencies, it is very wrong, Soros thought that this could be in response to the weakness of the Italian lira, and later Schlesinger said that he liked the idea of the euro, and if it was called a mark, he would like it more.

This means that Germany intends to strengthen the position of the mark in the European monetary system, and the mark will only rise, not fall.

Soros immediately returned to headquarters, (which convinced me that this "unexpected encounter" was more like an elaborate conspiracy.) Buy the mark immediately and short the Italian lira aggressively. In July 1992, Germany, with an inflation rate of only 3 percent, not only rejected the G-7 summit's demand for an interest rate cut, but instead raised the discount rate to 8.75 percent.

On September 11, Schlesinger announced that Germany would never cut interest rates. The next day, Soros sold the lira aggressively, and other investors followed frantically, although the Italian government raised the discount rate to 15% twice on the 7th and 9th, but investors still insisted on selling. On the third day, Italy had to announce the depreciation of the lira, lowering its exchange rate by 3.5 percent, and soon the lira was forced to withdraw from the exchange rate mechanism. On the fourth day, the Bundesbank announced a 0.5% interest rate cut, but it was too late.

The lira's exit convinced Soros that the pound was also worth playing, so Soros aggressively integrated the pound from the bank into the pound short, and the day after Germany announced the interest rate cut, the pound not only did not go higher, but fell all the way, which surprised investors who were long and short the mark. The market is often a win for a large amount of money, and this time is no exception. In order to defend the pound, the British government was forced to raise the bank interest rate by 2 points in the early morning of the 16th, and a few hours later, it was announced that it would raise the interest rate by another 3 points, making the interest rate rise from 10% to 15% in a few hours, and the rate hike was raised twice in a few hours and reached 5% in British history, which is unique.

This is the British government's desperate bet, Soros believes that it will not last long, so he sold the pound more actively, on the 16th, the pound continued to plummet, after all means were exhausted, that night, British Chancellor of the Exchequer Lamont announced that Britain would withdraw from the European monetary system and cut interest rates by 3%, and announced on the morning of the 17th that interest rates would be cut by another 2%, from 15% to 10%. On the same day, the lira also announced its withdrawal from the European monetary system and the introduction of free floating. On September 16, the day was a nightmare for the Bank of England, which spent $10 billion to stabilize the currency, but ultimately lost $7.7 billion, and the British Finance Minister Lamont had to step down. And Italy spent 40 trillion lira, which did not work.

That night, Soros used $10 billion and made $2 billion.