A week later.

In this office, which has a panoramic view of Manhattan, Alan . Schwartz looked at the tall buildings outside, but there was no excitement in his heart. He was surprised to sit in the position of CEO of Bear Stearns. Kane himself is a major shareholder with more than 5% of the shares, and if he is unwilling to move his position, the directors of the board of directors will not be able to say anything. But for some reason, Kane actually gave up the position of CEO and let him pick up a big bargain, perhaps the other party wanted to focus more on his hobby bridge.

Schwartz, who joined Bear Stearns shortly after graduating from Duke, has been with the company for 30 years, and it is fair to say that the company's culture runs through its bones. He started as a stockbroker and is very good at dealing with people, and has a reputation as a "super salesman". He is not very tall, with an ordinary white face, his hair is half-white because of years of hard work, but he is well maintained, and his lips are often pursed and his eyes occasionally show falcon-like eyes to reveal perseverance and shrewdness, which is the image of Wall Street's most famous investor.

Just haven't waited for the ass to sit hot, Alan. Schwartz found the current situation at Bear Stearns to be quite bad and very tricky. The fixed income department has hoarded positions that cannot be sold, and can only watch the losses continue day by day; Because of the bad market, Bear Stearns' proud brokerage business has also stagnated; The investment banking business is relatively good, relying on the wave of financing in emerging markets so far, which has exceeded the quota of the same period last year, which is the only bright spot among the core businesses.

It took Schwartz a week to sort it out, slowly disposing of that part of the bond position, shrinking the FICC business, and then vigorously developing the brokerage business, providing leverage business and settlement business. At the same time, it strengthens its wealth management and investment banking businesses. And if he follows the strategy he has laid out, he will have to go through at least a purge first.

In terms of personnel changes, Schwartz is currently under the most pressure on Bear Stearns' sluggish share price, which has been a rollercoaster ride after investors are skeptical of Bear Stearns' earnings prospects after an internal hedge fund crash and fourth-quarter losses. So far, it has only been at a measly $62 per share, almost a third of which is from its peak of $170.

At the beginning of his tenure, the board gave Schwartz a death order to raise the stock price above $100 this year, no matter what. These figures can be related to the net worth of the directors, and as a professional manager, he naturally does not dare to be sloppy.

But just when Schwartz ordered the people in the capital markets department to secretly observe the table of his stock and prepare to buy the dip, he unexpectedly heard a news that shocked him. Someone is shorting Bear Stearns' stock, and it's been for three or four days.

Logically speaking, the U.S. stock market can be both long and short, and it is a T+0 type transaction, that is, it can be bought on the same day and sold on the same day, so it is not a strange thing for someone to short Bear Stearns' stock. But according to the feedback from the capital markets department. This short-selling force is not just as simple as selling and covering positions while the dip is low, but selling with all its might. There is no point in covering the margin at all.

Although there are only three or four trading days at present, the momentum of the other party's short selling is extremely fierce, and the first few trading days have reached the level of 10 million US dollars every day. Yesterday, that number suddenly surged to $50 million, more than the previous few trading days combined, and the momentum was surging.

Under the shorting of this force. Bear Stearns' stock has fallen sharply in recent trading days and is down a full 10% so far. But judging from the situation on the market today, the other party is still not satisfied with this decline, and still sells Bear Stearns' shares regardless of it.

"Damn it. Where did they get so many chips, and how could they sell so many shares? ”

Upset and irritable, Alan. Schwartz couldn't help but explode. According to the calculations of the Capital Markets Department, the short seller has sold at least 1.5 million shares of Bear Stearns in the past few days, accounting for about 1.2% of Bear Stearns' total share capital. Although these shares will not shake the fundamentals of Bear Stearns, they will inevitably lead to a decline in Bear Stearns' stock price in the short term, leaving the market with the possibility of spreading rumors.

"Are we considering entering the pallet, or making a redemption plan, after all, the current price is not high, and a proper recovery of some of it will help the stock price rise." Head of Capital Markets Jones. McCammere frowned.

Jones. McCammere is the quintessential Wall Street stalwart: suited, shiny hair, tall, ambitious. Once at Bear Stearns, he was determined to become a member of the management team. With a brilliant mind and hard work, Jones. McKenmire quickly stood out as one of Bear Stearns' many department heads, and the youngest at just 35 years old.

The main responsibility of the Capital Markets Department is to provide market analysis to the Investment Banking Department, and to provide professional advice on various derivatives in the decision-making of clients on leverage, such as the allocation of equity capital, the structuring of bond issuance, valuation, pricing, etc., which functions similarly to the combination of the Research Department and the Sales Department. However, because Bear Stearns' sales department was particularly strong, the sales function of their capital markets department was strictly marginalized and could only develop into the research department.

Now Jones. McKenmere's statement that his stock is undervalued is the result of their internal research. However, even Bear Stearns' fellows can't fully grasp their full financial situation. McKenmere's Jianyì, Allen. Schwartz was noncommittal and silent.

"Observe and observe, if the other party continues to short in the next three trading days, then we will not hesitate to counterattack and give them a little bit of power!" After a long silence, Schwartz finally made up his mind and said categorically.

Although I am not very satisfied with Schwartz's decision in my heart, I don't even know who the other party is, where the boundary of shorting is, and whether there are any back-up moves that have not been used. Jones. McCammere knew that this was the way to go.

Just as he was about to say something, the phone in his arms suddenly buzzed and vibrate. McKenmere took out his phone, just glanced at it, and immediately changed his face as he held up the phone screen to Allen. Schwartz. He asked hurriedly, "Allen, are these true?" Is it true? ”

"What?" Schwartz glanced at the other party suspiciously, took the phone and just swept it slightly, and his face changed in the same way. He looked at the phone for a long time before he slowly handed it back, his face becoming calm again, "Yes, everything said in the Financial Times is true." ”

Jones. McKenmire's BlackBerry has just received an email about Bear Stearns. in the mail. The retweet was a report by the Financial Times of London on the termination of DBS Bank in Singapore and the closing of the deal with Bear Stearns. The report quoted an unnamed trader as saying that due to risk considerations, DBS Bank has issued an internal order prohibiting transactions with Bear Stearns, including settlement.

Behind the article, the author specifically mentions that because of the effect of DBS Bank in Singapore, other Asian banks have followed suit and started to close the deal with Bear Stearns. Now local banks in the UK are also considering no longer doing counterparty business with Bear Stearns, although none of them have so far publicly stated this.

"You already knew about this qiē?"

See this reaction from Schwartz. Jones still doesn't understand anything. He held his head and wailed, "Oh my God, this is happening. How can we restore investors' confidence? ”

As the boss of the capital market, he naturally understands the importance of investor confidence. In fact, a few minutes ago, he didn't take the stock price drop seriously at all, because as long as the management came out to show up, a little hint would restore the market's confidence. But now that this has erupted, it will be difficult to save Bear Stearns' share price from slumping, at least in the short term.

"Relax. Buddy! Looking at Jones's helpless face, Schwartz couldn't bear it, and couldn't help but say comfort, "Even if some banks in Asia and Britain don't do business with us, we won't be fine." Rest assured. As long as we are given enough time, we can still get the stock price back on its feet. ”

Until now, he was still worried about the stock price, completely unaware of the real purpose of the short seller.

"Stocks, stock prices ......"

Like a bolt of lightning piercing the sky, a thought suddenly appeared in Jones's mind, although it was fleeting, but it was still captured by Jones's fast-spinning brain, "Allen, Allen, you honestly tell me, how is the company's cash flow situation now?" ”

"What?" Schwartz rebuked, his face visibly unhappy as he shouted a question. Logically speaking, this is a secret that only executives who have reached a certain level of knowledge, and this level obviously does not include Jones. McKenmere. However, seeing Jones's anxious eyes, he realized that what he said just now might be too heavy, so he slowed down his tone and said, "Don't worry, Jones, the liquidity on the company's books is very sufficient now, and it can definitely ensure the normal operation of the company." ”

After hearing this answer, Jones. McKenmere breathed a sigh of relief as if he had been pardoned, clutched his chest and said with some trepidation: "Sorry, Alan, please forgive me for being rude. Just now, I realized a terrible possibility, the current qiē is all made by short sellers, their purpose is to try to suppress our stock price, these are common tricks in the market. ”

"You're saying it's DBS Singapore that is shorting us?" Allan. Schwartz's face changed, this opponent is really a bit strong, although it is not enough to scare him, but it is always trouble. However, after thinking about it carefully, he couldn't find the possibility that DBS Bank would short his company, so he waved his hand decisively and said, "It's unlikely, I can't find a reason for them to short us." ”

"Nope! No! No! Jones shook his head repeatedly, "I don't think it will be them, they really don't have a reason to short us." But I think they were tricked by others and chose not to trade with us in a cautious way. This is a negative for us, there is no doubt that the black hand behind it has not yet appeared, but if this qiē is true, we must not sit back and wait any longer. ”

"Is it really that strict?" Schwartz's brow furrowed as he felt that Jones's words were too true. Although he is a brokerage and sales background, he has also seen a lot of tricks in the stock market, so he believes that this time the action of shorting Bear Stearns stock is at most a short profit after reaching a certain low point, and will not shake the foundation of Bear Stearns.

As long as the financial statements for the first quarter come out, today's sluggish stock price will immediately soar, as long as the statements can turn losses into profits.

"It's hard to say exactly how far Yan zhòng will go!" Jones. McKenmere didn't care about Schwartz when he saw it, and he didn't dare to exaggerate the consequences too much, after all, if his opinion was adopted by Schwartz, it might become an important reference for Bear Stearns' policy direction in the future, and once his guess was wrong, then he was likely to fall into a catastrophe all of a sudden, after all, these things involved thousands of funds, "At present, the most suspicious shorting of our stocks are those hedge funds, and only they have the financial resources to stir up the market." We need to keep a close eye on their money flows, and if necessary, we need to mobilize funds to protect the market. ”

Because Bear Stearns is the top brokerage on Wall Street, many hedge funds take advantage of its channels. Although the brokerage cannot inquire about the other party's investment targets and positions, as long as the flow of funds and the use of leverage are monitored, the master can still guess a part of the investment.

"It won't be them!" Schwartz's denial this time was very firm.

What Jones didn't know was that after DBS broke off the deal with Bear Stearns, several more banks broke off their dealings with Bear Stearns. Prior to the Financial Times report, the news had been circulating on a small scale, and as a direct consequence of the fact that some clients, many of them in Asia, had begun to demand the withdrawal of funds held in custody in Bear Stearns, which was inevitable. Bear Stearns is also methodically returning the funds to investors, amounting to about $11 billion. And in this wave of refunds, there is not a single hedge fund.

That's why Schwartz is adamantly denying that the institutions that shorted Bear Stearns aren't hedge funds, at least for now, not them. (To be continued......)

PS: Thank you for the book friend kalm god and ass bear for voting for the monthly pass!