Soros is indeed going long, at a time when the Asian currency storm is blowing in the second wave.

At a time when the currencies of the whole Asian region continue to fall, Soros actually dares to go long in the face of the world's condemnation, can it be said that this famous fund manager has a problem with his brain?

Clearly, there is nothing wrong with his perhaps the most valuable head in the world. Even if he has a problem, there is a person like Druckenmiller who is also extremely smart in the industry within the Quantum Fund, and the probability of two people having problems in their heads at the same time is almost negligible.

In fact, what Soros said at the annual meeting of the World Bank in Hong Kong about the end of the currency crisis is not empty words, but he really thinks so, at least for the currencies of some countries, Soros does think that they have successfully avoided the currency crisis.

For example, Indonesia and the Indonesian rupiah.

Since their last meeting in Washington, Soros and Julian Robertson have gone their separate ways, each taking charge of a region. This division of labor is not absolute, in fact, there are people on both sides who keep an eye on each other's actions, and if there is an obvious opportunity for speculation, they will intervene in time.

Just like the impact on the Hong Kong dollar and the Hong Kong stock market, Soros's quantum fund is also involved, but the position is not too big, and it can only be regarded as a small fight compared to the position of the Tiger Fund. After all, this attack on the Hong Kong market was led by the Tiger Fund and his horses, and it was obviously not appropriate to dominate the crowd, so the two sides tacitly maintained each other's leading position in their respective offensive plans.

As for fame or something, to be honest, Julian Robertson didn't care. In fact, his reputation in the European and American investment circles is no less than that of Soros, and he is very happy to let the Quantum Fund and Soros attract artillery fire in front of him.

It is no coincidence that Soros is bullish on the rupiah, and he and the Quantum Fund have been following the performance of Southeast Asian currencies since the collapse of the original monetary system, including the Thai baht, Philippine peso and the rupiah, especially the rupiah.

After the outbreak of the Thai baht crisis, the storm of currency crisis quickly spread throughout Southeast Asia, with currencies such as the Philippine peso, Malaysian ringgit, and Indonesian rupiah depreciating one after another, and several countries with open capital accounts successively abandoned the fixed exchange rate system and allowed their currencies to float freely in the market.

Indonesia has to be mentioned here, this country is quite strange. In the 70s, the capital account was opened before the current account was opened. When there is no inflow of capital, there is an outflow of capital. That is, the free flow of capital has been achieved without free trade in goods, and overseas investment has been taken the lead in the absence of foreign capital investment, which is extremely rare among Southeast Asian countries.

There is only one reason for this discrepancy, and that is that Indonesia is an OPEC country. Rich in oil. The level of affluence is far higher than that of other countries in Southeast Asia.

After the oil crisis of the 70s. The Indonesian government (oil and gas are state-owned) is so rich that it can't wait to open up its capital account and let the rupiah and the dollar circulate freely.

Since the outbreak of the currency crisis in Southeast Asia. The Indonesian government took the lead in reacting by allowing the rupiah to depreciate freely in the market. Because Indonesia's domestic economic problems are not too serious compared to several other countries, and the rupiah is backed by huge oil resources, the rupiah has depreciated by 11% before stabilizing.

At this time, the reason why Soros chose the rupiah is because he inquired about a very important news, which is enough to restore the rupiah to the level of 3,000 rupiah per dollar in the medium and long term.

According to internal information, the International Monetary Fund will implement a bailout plan for Indonesia in the near future, the specific contents of this plan include: the Indonesian government will shelve large-scale infrastructure projects worth up to $13 billion, the IMF will provide a total of up to $23 billion in multilateral financial rescue funds, require Indonesia to close 16 financially troubled banks, and relax some control measures, including reducing import taxes, providing export incentives, and opening distribution and wholesale markets to foreign manufacturing companies operating in Indonesia.

In fact, negotiations between the Indonesian government and the IMF have been going on, and the market is watching them closely. On October 26, International Monetary Fund negotiators flew back to Washington from Jakarta for further discussions on the bailout package to help Indonesia emerge from the financial crisis and restore investor confidence, and the IMF's board of directors, with the final decision on the bailout package to be announced in the coming days.

Soros's deep throats, on the other hand, received definite information before the announcement that the IMF would approve the plan.

At present, the market price of the rupiah is around 3,600 rupiah per dollar, which is still a short-term effect caused by the sharp fall in the Wall Street stock market, and once the news of the IMF's aid to Indonesia is announced, it is believed that the rupiah will soar in the short term, and at the same time, in the foreseeable future, the market will regain confidence in the rupiah.

That's why Soros is trying to do more rupiah.

According to the internal estimates of the Quantum Fund, in about six months to a year, the rupiah will appreciate by at least 20%, which is still a fairly conservative estimate. A position of $2 billion means at least $400 million in returns, which means 2% of the total amount of funds in the Quantum Fund, a rather terrifying number.

A quantum fund with a total management fund of up to $20 billion, even if the return is 1 percentage point, that means $200 million in income. In fact, there is very little room left for $20 billion in the market, so Soros's quantum fund is divided into several sub-funds, targeting various capital markets around the world, such as London, New York, Tokyo, Hong Kong, Frankfurt, etc., and will not miss any potentially profitable investment opportunities.

Naturally, the current Indonesian market has become Soros's next target.

It's funny to say that when it comes to crushing the fixed exchange rate systems of countries such as Thailand and the Philippines, Soros has been playing the role of the biggest bears in the market. But the smoke of the war caused by him in Southeast Asia has not completely dissipated, and Soros has turned into a bullish side.

To speak of this rapid change of position. It will inevitably surprise some moral gentlemen, and Soros has had a lot of trouble with political leaders in some Southeast Asian countries before. But in the mall, this situation is so common that there is no morality as long as there is a profit.

Now there is only one problem left, that is, the liquidity of the rupiah is really a bit insufficient, although Indonesia has opened its current account, but the control of foreign manufacturing companies is quite strict, and in the capital account, there is a net inflow of funds in US dollars. In a word, due to various reasons such as the economic system and its own industrial base. As a result, the foreign exchange market trading in the rupiah is quite underdeveloped.

And with the outbreak of the currency crisis. Indonesia's banking sector, including foreign banks, has been warned by the Suharto government to be cautious in lending money, as no one wants to offend the authoritarian Suharto government.

Soros was unable to acquire a full position in the foreign exchange market. You can only find some super banks in Asia. Hopefully, they will be able to buy enough rupiah from them. And Asian super banks like HSBC got commissioned.

HSBC is certainly not a fool, and buying rupiah at such a sensitive time is problematic in itself. What's more, the other party is a thunderous quantum fund. As soon as the people in the Indonesian branch and headquarters were briefed, they decided that there must be a major problem, and they naturally did not want to act as an opponent of the other party, because Zhongshi, who borrowed a large amount of rupiah in the Indonesian market some time ago, fell into the sight of HSBC's senior management.

"Zhong Sheng, if you want to do currency transactions with your loans, now that the rupiah has depreciated a lot, it doesn't seem to be cost-effective now, so it's better to throw it away now? Or in the US dollar, the interest rate on the US dollar side is higher. Lin Legeng racked his brains and finally came up with a feasible reason for Zhong Shi.

However, this reason is quite far-fetched, because Zhong Shi only lost part of the interest at most, and the term of his loan was a full year, that is, until July of '98, and he deliberately ignored the exchange rate risk in the exchange process.

After Lin Legeng finished speaking, he didn't believe this nonsense. It's just that he is very thick-skinned, and he doesn't show the slightest look of guilt, but looks at Zhong Shi with blank eyes, waiting for Zhong Shi to give an answer.

"That's ......"

Zhong Shi touched his smooth chin and thought for a long time, and then said slowly: "Actually, I don't have to hold this loan in my hand, since you say so, I can consider it, but the exchange rate may be slightly higher than the market exchange rate." ”

At this time, the exchange rate between the Indonesian rupiah and the US dollar is around 1:3600, although the market fluctuates, but the amplitude is not very large. It has to be said that the Indonesian government's choice to take the initiative to depreciate has kept the rupiah relatively stable to a certain extent.

"This?" Lin Legeng made a bitter face, frowned and thought for a long time, and then cautiously tested: "I don't know what your psychological price is?" I can ask about the quantum fund, if the magnitude is not very large, we have the possibility of cooperation. ”

He knew that he couldn't hide the little caution he had saved, and even if he thought with his toes, a fund manager who could manage hundreds of millions or billions of dollars of funds would not ignore exchange rate fluctuations when buying and selling currencies.

"3500, it can't be lower." Zhong Shi was waiting for this sentence, and as soon as Lin Legeng's words came out, he quickly spoke.

Zhong Shi's funds were borrowed as collateral for the same amount of US dollars, and the exchange rate at that time was about 3,000 rupiah per dollar, and later with the depreciation of the rupiah, he successively bought some of them in the foreign exchange market, and now he has a face value of 7 trillion rupiah on hand.

At this exchange rate, it is almost 2 billion US dollars, which is just a whole number to be easy to calculate, Zhong Shi thought so evilly.

"Can it be lower?" Lin Legeng's face was about to wrinkle into a chrysanthemum, and anyone who saw it would sympathize with him, but in fact, he was extremely happy in his heart at this time, because the price offered to them by the Quantum Fund was 1:3520/30, which was basically the same as the quotation on Zhong Shi's side, and the exchange rate difference in the middle was almost negligible.

But even so, Lin Legeng still stubbornly bargained with Zhong Shi, but Zhong Shi always insisted on this price. Lin Legeng took a lot of time, but in the end he couldn't convince Zhong Shi and could only accept the price. At the time of signing the agreement, an old face looked ugly as if both parents had just died.

No, maybe it's even uglier than the death of both parents.

After Lin Legeng said goodbye and left, Andrew walked over with a frown. He knew that Zhong Shi didn't want to be disturbed when he was doing business, and he generally didn't listen to other people's opinions, but this matter was not trivial, so even if he was criticized a few times, he had to analyze the situation clearly for Zhong Shi. After walking to Zhong Shi's side, Andrew first glanced at Zhong Shi, and then persuaded worriedly: "Zhong Sheng, are you really bearish on the Indonesian rupiah?" You must know that there have been a lot of rumors about the Indonesian rupiah in the market recently, and one of them is ......"

"I know the way!"

Zhong Shi interrupted Andrew's words, and there was no expression fluctuation on his face, which made Andrew inexplicable for a while. But after half a day, Zhong Shi suddenly laughed out loud, first sneering proudly, and then the laughter became higher and higher, revealing a hearty pleasure.

"There aren't many opportunities to pit Soros, who would have thought that I would run into one, how could I let it go? Hahaha...... Soros thinks he has inside information, but he doesn't understand what politics is, he doesn't understand the Suharto government...... Haha......"

Andrew had a black line on his forehead, and he couldn't understand what Jongshi was saying, and he was thinking about whether to go to the doctor to see Jongseok, who was already laughing and even bursting into tears. (To be continued......)

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