In this sniping incident, if the pound does not depreciate, Soros will only lose an interest difference, at most hundreds of millions of dollars, compared to him who has invested tens of billions of dollars, losing hundreds of millions of dollars is not a risk at all, and if the pound depreciates, he will instantly earn billions of dollars.

Kong Yifu has taken a conservative approach, investing tens of billions of dollars in anticipation of seemingly fixed returns of hundreds of millions of dollars, which is the opposite of Soros's small and large, and completely in the rules of the big and small.

At that time, the two major funds on Wall Street adopted different strategies, and many investors did not know which side to lean into, and if investors had leaned towards the Klean Fund in favor of the pound, there would have been no famous European currency crisis.

But it is obvious that Soros, a Jewish giant who has been galloping in the international capital market for decades, is more influential than the "China Kong" without any background, and the huge Jewish hidden wealth group behind Soros is inclined to the side that wants the pound to depreciate in the market. The scales of international financial markets have been skewed.

After Germany announced the news that its interest rate would not fall but rise, various investors began to sell the pound sharply, and the British government was powerless to resist, and finally abandoned the exchange rate system and adopted free floating, and the pound immediately depreciated by 10%, and the pound depreciated by 22% in just one month.

In the past month, Soros's quantum fund has netted $2 billion. As for the Cole Fund, it has a net loss of 4 billion! The loss is up to 60%! The defeat led to the end of the Walker Fund at the end of that year.

The Cole Fund, a hedge fund that was once at the top of the financial markets, was ruined. It's all on Kong Yifu's back. A big gamble that cost Kong Yifu all the accolades, and the ultimate confrontation between him and Soros. It ended in complete defeat.

In 93, the 33-year-old Run Run Kong persevered, established Shaw Capital Management, established the Mercury Fund, and prepared to do it again. But at that time, investors chose the smash hit Quantum Fund and Tiger Fund for capital injection, and treated the Mercury Fund coldly.

In order to create good results, Kong Yifu is opportunistic in the stock market. As a result, Shaw Management Company was sued by the U.S. Securities and Exchange Commission (SEC) less than five months after its establishment, and Shaw escaped prison. But the hefty fines left him destitute.

After that, he had to start his career as an analyst all over again. The continuous setbacks have turned the Chinese hole that dominated Wall Street into a joke. No one believes he has what it takes to run a large hedge fund anymore. The world of Wall Street has the most brutal form of competition in the world. If you succeed, your bones will not count here. Even if the first battle is successful, ten thousand bones will be withered. When you lose the rematch, no one will look up to you.

Run Run Kong, who has suffered continuous setbacks, in 94, at the invitation of a friend, humbly became a low-level analyst again, and entered Morgan Stanley to engage in financial derivatives trading, which was on fire at that time.

Kong Yifu knew that derivatives at that time were all deceptive things, and the real financial masters did not disdain to play such deceptive tricks. But thinking of his impoverished predicament at that time. He can only rely on this to make money first and save enough capital to fight on Wall Street again.

To say, a genius is a genius. If they are given the opportunity, they will definitely create amazing results.

The financial derivatives engaged in by Run Run Kong at Morgan Stanley are not derivatives in the traditional sense, but financial products designed to avoid regulations and exploit loopholes.

For example, the U.S. Securities and Exchange Commission prohibits insurance companies from investing in products with lower than Standard & Poor's ratings and lower than AA, and Run Run Kong and Morgan Stanley will package products with lower than AA ratings, like some junk bonds, into a product that is AA rated on the surface but is actually much lower than AA ratings, and the surface rate of return of this product is often several percentage points higher than that of real AA-rated products, so insurance companies will not hesitate to invest in them. At this time, Kong Yifu and their derivatives department will receive a high commission.

The risks behind such derivatives are extremely high, and investment banks often do not thoroughly disclose how big the risk is for the sake of commissions, and even if they do, they will not let investors really understand where the risks are. To put it bluntly, the people who sold this kind of derivatives at that time were fooling people.

Although this kind of derivative is risky, but before 93 years, there were not many investors who really reported losses, and even if some of them suffered losses, they also tried their best not to report losses for the sake of their image, so this kind of derivatives were popular in the United States before 93 years.

But at the end of 93 and the beginning of 94, several large companies such as Procter & Gamble exposed the news of huge losses by investing in derivatives, which began to arouse people's alarm. It was at this time that Esoff joined Morgan Stanley and entered the Emerging Markets Group.

At that time, Morgan Stanley was not involved in the illegal derivatives transactions that were exposed, so it had a good reputation, and their derivatives sold the best in the market.

Kong Yifu is familiar with this market, with a deep mathematical foundation and flexible thinking, he has designed a lot of unimaginable derivatives, and has become an expert in the department in less than half a year, and at the same time, the commission has been unsurpassed.

At that time, the Mexican economy was booming, and many American investors were interested in the Mexican market.

At that time, Mexico, like many other countries, borrowed in various currencies, the most important of which were the Mexican peso and the US dollar. Investors wanted to invest in dollar-denominated bonds, but the Bank of Mexico issued very low dollar bonds at the time, often below BB, while pesos issued were very high-rated, above AA. (Reason: The Bank of Mexico is very simple to repay the peso, and if you can't afford it, you just need to print more, and the dollar has to be repaid through hard currency, so the rating agencies are only optimistic about Mexico's peso repayment ability and low on the dollar repayment ability.) ）

Because the economy is overheated and the currency is afraid of devaluation, investors are reluctant to touch the peso bonds issued by the Bank of Mexico, which have pressed a lot of peso bonds, and most of them are inflation-linked adjustment bonds, which have been greatly impaired and extremely illiquid. At that time, the banks in Mexico wanted to remove the bonds from their balance sheets, but they didn't want to sell them, because they had to record a loss, so they approached Morgan Stanley and hoped that Morgan Stanley would liquidate the peso-denominated bonds, but they didn't reflect them on the books. (To be continued......)