Chapter 116: Value for money
readx;?The beginning of a new wave of interest rate hikes?
Although every time the Federal Reserve adjusts interest rates, it is not accidental, and a seemingly random interest rate cut or interest rate hike often means the beginning of a long period of large-scale adjustment, but when this ominous premonition was "confirmed" by Xiao Yang himself, everyone present was still inevitably moved, and the head of the investment department of Wells Fargo, Paio Lesky, couldn't help but blurt out: "So may I ask Mr. Xiao, how long will this round of interest rate hikes last, and how big is the magnitude and scope of the adjustment?" ā
The scope of this question is too general for Fed Chairman Alan Greenspan himself to give an accurate answer, but as a traverser, Xiao Yang has already had a complete and clear foresight of this: out of concern about inflation, the Fed will gradually raise the federal funds rate from the current 3% to 6% in the next year, an increase of up to 100%, resulting in a number of banks and investment banks with large positions in long-term toxic bonds, including Kidd Peabody Investment Bank, forced to collapse or be acquiredIn addition, a number of local governments represented by Orange County, California, have been financially bankrupt, and the economy of neighboring Mexico has been severely impacted and an economic crisis has occurred, which will also lead to a large number of international funds withdrawing from the United States and pouring into the Asian financial market, promoting the rapid development of the Asian economy in the next few years, and sowing the seeds of disaster for the Asian financial crisis three years later. Pen @ fun @ pavilion wWw. ļ½ļ½ļ½Uļ½Eć ļ½ļ½ļ½ļ½
However, Xiao Yang does not intend to shake out everything he knows right now - such a major financial news cannot be exchanged for only $500,000, and his purpose is not limited to taking out millions of dollars from these people's pockets, properly showing his understanding of the future economic trend, and firmly tying these securities and investment elites - at least some of them firmly to his warship, using their professional qualifications and abilities to make money for him, this is his ultimate goal, from this point of view, Previous predictions of the Los Angeles earthquake, the Golden Globe Awards, the settlement of the Jackson child molestation case, and even today's dinner of fortune are just necessary foreshadowing.
Based on the above reasons, after satisfying everyone's appetite, Xiao Yang slowly announced: "According to the situation I foresee, the Fed will raise the existing federal funds rate in early February, late March, April, May and mid-August, of which the first adjustments were 25 basis points, and in May, the pace will be significantly accelerated, each time by 50 basis points, and the federal funds rate will reach ...... at that time."
"4.75%, in just half a year!" Stephen Norris, the chairman of the board of directors of the President's Club, couldn't resist shouting out the end result for him, "Hell, this is hell - I mean, if it all happens the way you say it is!" ā
"And it does, I can assure you." Xiao Yang stretched his upper body, leaned comfortably on the back of the chair, spread his hands and asked with a smile: "So, do people still think that the 500,000 is not worth it?" ā
Worth?
If he really said that the Fed is planning to use the knife on the current interest rate, which has been maintained for nearly a year and a half, who would dare to say that the 500,000 is not worth it?
As Xiao Yang described to Brian before, this news may not help these securities speculators here make money, but it can definitely save them from huge losses -- a sharp increase in the interest rate means a sharp rise in the cost of speculation, according to the interest rate of 4.75% in half a year, the book cost of treasury bonds and securities held by these people with a maturity of more than half a year will increase by nearly 60%, and the vast majority of them are expected to make no more than 50% of the expected profits. This means that this part of the originally benign assets will become a pile of waste paper, or more accurately, they will become a pile of time bombs, blowing up these billionaires to the ground and even bankrupt!
Although it can be confirmed that if Xiao Yang's prediction comes true, then the risks and losses that everyone here can avoid will be several times, dozens of times the 500,000 ticket money, and the benefits will be higher in the long run, but at this time, no one has the heart to answer his obvious question, because everyone's minds are moving the same thought: walk out of the banquet hall as quickly as possible, take out the phone and dial every number they can find, so as to activate all the relationships that can be activated, and prove it at any cost!
Knowing that this banquet has been carried out so far, the expected goal has been achieved, and it will only be a useless waste of everyone's time to delay it any longer, so Xiao Yang did not dissuade everyone from leaving the table one after another, but reminded again: "I know what you plan to do next, but I advise you that while launching a relationship verification, please don't forget the agreement between us." ā
"Of course, after all, this news is worth 500,000!" Stephen Norris took the lead in echoing, and after everyone shook hands with Xiao Yang and Brian respectively, he pulled Xiao Yang aside, lowered his voice and said, "What are your plans for the 6 million you just received?" ā
Xiao Yang thought that he also wanted to undertake his own investment business, so he politely refused: "With my net worth, it seems that I am not qualified to enter the 'President Club'?" ā
"Don't get me wrong, I'm not trying to get you into investing - of course, with your speed and ability to attract money, if you want to join my club, I will definitely welcome you with both hands." Norris waved his hand and smiled: "That's right, I have a batch of 10-year US Treasury bonds on hand, maturing in three months, with an expected return of more than 50% - of course at the previous interest rate - I wonder if you are interested in taking over?" ā
Xiao Yang quickly mentally calculated, "How many?" ā
"The total is more than 50 million," Norris said, "and if you are interested in eating it, I can give you another 5% off the issue price." ā
"50 million?" Xiao Yang smiled, "I can't even take out 10 million in hand." ā
"Then give you 10 million, and the difference will be made up to me before it expires." Seeing Xiao Yang's hesitation, Norris added: "I don't mean anything else, I just want to make you a friend, you should know that before the news of the interest rate hike is confirmed and spread, this is a pretty good investment, and there is no shortage of people to take over the 20% increase." ā
Of course, Xiao Yang understands this, saying that the ten-year treasury bond itself is a good project worth considering, Norris is in a hurry to sell it because there is a huge amount of interest to pay, if it is acquired in cash, the expected yield will reach more than 60%, and it will make a steady profit of 6 million in 3 months, which is a good investment no matter how you look at it.