What happened in the U.S. stock market quickly spread around the world, but the economy is a long chain, and it takes time to transmit, so the European stock market, although it was also affected and fluctuated a little, quickly stabilized. Pen fun and pavilion www.biquge.info

After Yang Chao received the news, he sighed in his heart, a little pity, but also a sense of relief, because the time to come has finally come.

After the end of China's October election, Yang Chao began to pay close attention to the dynamics of the United States, and to his surprise, at the end of October, the U.S. stock market did not collapse.

He clearly remembered that October 24 was the beginning of the stock market crash, but that day was extremely calm, and then it was quiet for two months, until December 25, Christmas Day, that the deserted department store industry triggered the collapse of the US stock market, which surprised Yang Chao.

As for why it was postponed for two months, Yang Chao thought about it for a while and thought that there were probably two reasons.

The first is that the United States has been confronting China for a period of time, during which the United States has invested a sum of money in the military, so it has withdrawn some funds from the market, which has slowed down the accumulation of economic bubbles. The second is that Federal Reserve Chairman Benjamin Strong did not die of tuberculosis, as is the case in history.

In the mouths of later economists, Benjamin Strong was known as the man who had the potential to save the United States from this stock market catastrophe.

Born in New York to a family of New England descent, Benjamin Strong joined Jessup Palton Bank at the age of 18 and rose through the ranks on Wall Street, maintaining good personal relationships with banking giants such as Morgan, such as Henry Davidson, a partner at Morgan Bank, who adopted his children after his wife's suicide.

Benjamin is a strong person, but the marriage is a failure, the first wife committed suicide, and the second wife also divorced him, probably because Benjamin put too much energy into work. His hard work led him to rise higher and higher, and he became the chairman of the Morgan family-controlled Xinfu Bank. In the end, he was persuaded by Morgan and others to become the first chairman of the newly established Federal Reserve, otherwise he would have become a partner of Morgan Bank and one of the top figures in the pyramid of the American banking community.

As a professional financial expert, Benjamin was keenly aware of the danger of financial speculation in the United States, and from 1928 onwards, he took decisive action, and in 1928, he raised the discount rate three times, pushing the discount rate to a high of 5%, hoping to tighten funds and stop speculation.

But no one cares about the Fed's high interest rates, the banks borrow money from the Fed at an interest rate of 5%, and then lend to the stock companies at an interest rate of 12%, and the companies lend to shareholders at an interest rate of 20%.

The Fed's policies did not affect Wall Street, but affected the real economy, and after tightening the funds, the first funds were not the center of the banking industry, Wall Street, which was the first to be funded, but other industries outside the financial system, so that the real economy slowed down significantly.

For Wall Street, they are still inflating themselves. Because the Federal Reserve has reduced its capital investment, but giants like Chase Bank, which is controlled by the Rockefeller consortium, is very powerful, and in this era it is even stronger than the Federal Reserve, which has just been born for many years. So Wall Street is still crazy.

In the original history, at the beginning of 29, Benjamin died after surgery for tuberculosis. But in this era, it is not so easy for him to die, because Yang Chao sells streptomycin everywhere, and tuberculosis is already a disease that can be easily cured. Benjamin is not dead, proving a truth that in the face of crazy gamblers, no one can save America, because no one can eliminate the greed in people's hearts.

But Benjamin's policies have had some effect, at least to make Wall Street less crazy and the speed at which money is invested.

Hence the collapse of the economy and a delay of 2 months.

But what should have come is still coming, and it's still a familiar taste, and the crash is still crazy.

Financial markets can drive prosperity and amplify the extent of prosperity, but they can also drive crises and increase the depth of crises.

Wall Street soon fell into mourning, but the giants did not give up, and Morgan and Rockefeller decided to jointly fund $20 million to bail out the market.

It's just a drop in the bucket, and the stock price plummets as soon as the New York Stock Exchange opens. Because many shareholders allocate capital to speculate in stocks, and the stock price falls so that the pledged stocks depreciate, they have to continue to add margin to the capital allocation company, and the shareholders have no spare funds, only to sell stocks to pay margin, triggering a vicious circle: stock depreciation - supplementary margin - fire sale of stocks - stock depreciation.

The bears came out to smash the market like flies smelling blood, and also used the margin system to sell a large number of shorts, selling tens of times the stocks they did not hold, and the stock price fell like a cliff, and by noon the market value had evaporated by 9.5 billion US dollars, and the 20 million that Morgan and others put into the market did not even make a splash.

Morgan and Rockefeller were bankers and philanthropists, but not outlaws, and after seeing the unstoppable stock crash, they did not fantasize about bailing out the market, but wisely escaped the market so as not to get caught up in it. The withdrawal of giants has caused the speed of collapse.

The US stock market is out of luck, and the transmission effect has finally reached Europe.

Tuesday, December 31, one week after Christmas.

The German economic crisis began.

It is not surprising that the German economy is in crisis, but it is not surprising that there is no crisis.

The U.S. banking sector, mired in the U.S. stock market, began to withdraw a large amount of money from Germany to save itself.

Germany, which had relied on British and American loans, especially short-term loans, to maintain its economic development, had problems in the first link of the chain of loans, production, and debt repayment, and then production could not purchase raw materials, and then it was unable to repay its debts, and the economic crisis was transmitted from Germany to Britain. But it has not yet been transmitted to France, which is relatively economically independent.

Even France has not been transmitted, let alone China, and Europe is affected at this time, mainly due to deflation caused by the continued withdrawal of US funds from Europe. The United States had a lot of investment and debt in Germany, and the siphoned off the funds led to the German economic crisis, which in turn affected the repayment of British debt.

France does not have a large amount of foreign debt and does not lend to Germany, so the impact is relatively weak. France has always been an independent market under the protection of high tariffs, and foreign trade is mainly carried out with its own colonies, and exports to Britain and the United States and other countries are often some fashion, perfume and other luxury goods, and the market for luxury goods is often less affected by the economic crisis, because the rich can always afford to consume.

The situation in China is similar to that in France, where the Chinese market is farther away from the United States than Europe, and has little connection with the United States, so it will not be affected much by the stock market crash on the New York Stock Exchange.

Therefore, China's economy not only does not see the signs of crisis, but is still in the midst of prosperity, after all, compared with the United States, there is still a gap in the degree of economic development between China, and there is more room and potential for development.

The Mi Ching government is even optimistic about the policy measures after taking office, and has made up its mind to promote the minimum daily wage legislation.

But she will have to wait a month before she takes the stage, because the Lunar New Year falls on January 29 of the following year.

At this time, it is already December 20, the Chinese are already busy preparing for the New Year, China has not yet developed the habit of mortgage loans and borrowing money to shop, so they are using their own savings, saving a year's worth of money The people are full of hope to buy New Year's goods, thinking about a good year.

The middle class is planning whether to use their savings to buy a car and go home for the New Year, or to save their money to repair their family house in the coming year, or even build a new house, or repair an ancestral tomb.

At this time, it is also the busiest time for many consumer goods factories, textile factories, garment factories, soaps, matches and other light industries are extremely busy, and these industries drive the downstream cotton, chemical fiber, minerals are quite prosperous, and the trains running on China's railway network are extremely busy.

Economists generally ridicule the collapse of the U.S. stock market, but are optimistic that China will not have the same crash as the U.S., because China's stock market is more strictly regulated, the systems are more conservative, and it is not as crazy as the Americans.

The same group of economists, for a long time, criticized China's stock and bond markets for being too rigid, arguing that there was not enough innovation and that various regulations were too strict, limiting financial vitality. Sure enough, experts can't be trusted.

Yang Chao was even somewhat affected by the market, and all the economic data he saw were very healthy. Investment has continued to increase, and corporate profit margins have been very stable.

Yang Chao feels that China is such a huge country, five times that of the United States, the industrial development of the eastern coastal areas is very rapid, but the degree of industrial development in the central and western regions is still very low, so it has much greater potential than the United States, and the degree of industrialization is not as high as the United States.

This feeling alerted Yang Chao to repeatedly remind himself not to be blindly optimistic, and there were already some industrial capitalists in Shanghai who were investing their profits in the stock market, which was a clear precursor to an economic crisis.

And 08 years ago, who would have thought that China would experience an economic crisis, economists all over the world are analyzing China's rapid growth, praising China's economic miracle, but as soon as the subprime mortgage crisis broke out in the United States, the world was instantly dragged in, and China was not exempt.

None of the more controlling Chinese governments in later generations will be able to prevent the economic crisis, so why should the loose constitutional government, with its local and central governments checking and balancing each other, and political forces competing with each other, be able to prevent China from plunging into a general world economic crisis?

So Yang Chao persuaded himself to accept that the economic crisis would definitely come, although no one wanted him to come, but he would definitely come, just sooner or later, what Yang Chao had to do was to wait for it to come, wait for the problem to happen, and then solve the problem, that's all. (To be continued.) )