There are many ways to wage war, and the first is just a test – and Dussander and Escobar want to test how much the imperial bureaucracy knows about financial crises...... How quickly the imperial bureaucracy can react.

Because the second form is hidden in the shadow of the first form.

As long as it succeeds in triggering a financial crisis, the Oilon stock exchange market, which is in an unregulated zone, can become the best source of income for Oilon Development Bank.

At a time when stocks are plummeting, there are two ways to make money. The first is to take the opportunity to buy a large number of high-quality enterprises at low prices, such as companies with their own minerals, or enterprises with a large number of production equipment and employees.

The second is to make money from other participants in financial market trading, and Dussand's plan has a more accurate term - short squeeze.

The total assets of Oilon Development Bank will reach at least 80 million gold pounds after the first type. There may be some losses in the initial absorption of public deposits, but after the successive failures of other banks, Olon Development Bank, which maintains relatively low interest rates, will certainly be able to attract more deposits from customers who need to be safe-haven. On this basis, the Olon Development Bank can start the second type of operation.

Shorting stocks is an arbitrage operation that has been practiced for a long time on the Oilon Stock Exchange. Traders borrow shares in a company from other shareholders, agree on a time frame, and sell all the borrowed shares.

To complete the short selling, the trader only needs to buy back the company's shares within the agreed time period and return the borrowed shares to the original holders. Of course, this stock cannot be borrowed for nothing, and in addition to paying a deposit, the trader also needs to pay an interest to the shareholder who lent the stock when returning the stock.

Most of the shareholders who are able to lend their shares do so for the purpose of receiving dividends, and they are relatively less sensitive to stock price fluctuations in the market. The main profit point for short traders is the difference between selling and buying, and the more the difference, the more they earn.

The target of the short squeeze is this group of short traders. They must buy back the shares of the shorted company within the stipulated time and return them to the shareholders. Otherwise, the short seller's deposit will be forfeited in full, and the full difference between the price of the stock and the price sold on the settlement date will be compensated.

Dussand's plan was very simple and crude, taking advantage of Olin Development Bank's huge financial advantage to find the most heavily shorted stock in the market and buy their shares in full – as much as they could.

Buy a large number of shares of a company, and the price of that company's shares in the market will start to skyrocket. Short sellers will soon find out that their attempts to short have failed and they are starting to suffer huge losses.

When Olon Development Bank completes its short squeeze, it doesn't matter exactly when they plan to exit. All the company's shares in the market will be bought by Oilon Development Bank, and these short sellers will not have the opportunity to buy back from the market to complete the last step of the transaction - buy back the shares in exchange for the shares needed by the lender.

According to the trading rules of the Oilon Stock Exchange, these short sellers first need to pay a margin equivalent to 90% of the current market value of the short stock, and if the position cannot be closed, the short seller also needs to pay the difference between the stock price at the closing point and the price when they borrowed it, and the margin must also be fully paid to the lender.

In other words, short squeezing can only make infinitely close to 100% of the profit at most, but the risk of loss is several times or even dozens of times the principal of the short seller.

In such unfavourable trading conditions, short sellers are still determined to make profits in this way, because they are confident that they will not be "maliciously shorted". The forces behind them are strong enough that no one who is not long-sighted will do anything to them.

However, the impact of insurance measures on the entire financial system is enormous. If the other party uses off-market moves to try to avoid the losses caused by short squeezing, it will have a fundamental impact on the short selling mechanism of the entire financial system. All other market traders have to think about whether my counterparty's background is harder than mine, and whether I may be killed by the other party's off-market moves.

The financial system and the conduct of financial transactions are essentially a castle in the air backed by confidence. Only if all participants recognize and believe that the market is fair – or at least relatively fair – will it be possible for the market as a whole to function.

This is Dussand's second goal, which is to make these market participants so painful that they will not hesitate to use off-market tricks to control their losses. And as long as they dare to control the losses, then combined with the propaganda of some central special branches, the key to Olin's financial system will be completely abolished.

Either make another fortune from the imperial financial system and bring down a group of super traders who dare to go short...... Or let the entire imperial financial transaction system fall apart.

This is the power of faith.

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Dusson's two-step plan was based on the premise of "killing the empire's economy as much as possible" and "keeping the Olin Development Bank as safe as possible." All actions of the Oilon Development Bank are premised on compliance with the relevant laws and regulations of the Empire. Unless His Majesty the Emperor personally comes out to make a "royal will", the Olin Development Bank will at least be able to maintain a very safe position. As a legitimate participant in the financial markets, Olin Development Bank can act like a stinger, threatening the financial security of the empire at all times.

If His Majesty the Emperor really can't think of this, then it can be regarded as a complete ambush by Dussand. The original "absorption of public deposits" was not only for the rapid expansion of Olin Development Bank, nor for other small and medium-sized commercial banks to follow suit.

The fundamental purpose of absorbing public deposits is to blackmail or deter the empire and even the royal family. The larger the Olin Development Bank and the more deposits it absorbed, the more careful the empire had to deal with this stinger - if it were to do anything rashly, it would cause a large number of aristocrats and middle classes to lose their deposits. Those who have lost their savings will of course resent and even hate the culprits who have lost their money.

Even the Emperor of the Empire still needed to be wary of such widespread resentment. And with the support of the Central Special Branch, of course, the Olin Development Bank will not just wait for the empire to clean up.

Dussaint doesn't have a clear idea of this, but some rough ideas do. Like what...... Paying tribute to a certain Archduke Horn who wants money and wants to die in the Olin Development Bank more than half of the shares. When the time comes, His Majesty the Emperor will look at his grandfather's expression will be interesting, right?

"This Fang Yu is good, and it is indeed not small." Schultz, who was familiar with Archduke Horn, quickly saw the power of this series of measures, nodded appreciatively and asked, "When will the plan begin?" To build a bank that can attract deposits from the public, you must first have a large amount of start-up capital. ”

"This one has been solved." Lorraine smiled and said, "Newsar has sent two million gold pounds in cash, and these funds are our weapons. ”

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At Newsar, at least at the highest level of Upper Albin, not everyone agrees with Dussand's offensive strategy. At least Duchamp, who had returned to the rule of Newsar, disagreed.

"That's two million gold pounds." Duchamp frowned at Dussand's dinner table and said, "This money is even enough for us to carry out an armor enhancement modification on all our capital ships." ”

The armor-enhanced modification of the lead ship of the Newsal Navy is a project that Duchamp has been working on in full force lately. According to the current reply given by the Home Affairs Committee, the armor enhancement modification can be completed within five years at the earliest, at a total cost of about 1.9 million gold pounds.

In fact, the armor enhancement was not particularly technical in nature - in fact, the 1.9 million gold pound modification was nothing more than riveting another layer of armor plates about 30 centimeters thick into the core area of the capital ship.

The most fundamental reason for the speed of implementation of the armor enhancement program is the lack of money. After much calculation, the Home Affairs Committee replied that it planned to be implemented over five years, with 400,000 gold pounds allocated in the first year.

This made Duchamp very dissatisfied, but the greater dissatisfaction came from the contrast. Why did it take five years for the reinforcement of the capital ships to be strengthened, and then spend two million gold pounds in one go at the Olympian Bank?

"The need to equip our capital ships with armor is not so urgent." "Spending two million can slow down the development of the empire, and may even plunge them into civil strife." This strategy is the most profitable ...... at the moment," he stopped, looked at his father, and asked, "Even if it costs four million gold pounds, the armor protection of all capital ships will be completed within this year...... Will you be able to hold back the Empire's fleet? ”

Duchamp fell silent for a moment after this question pondered for a while before he said, "If it were the entire main force of the two Imperial Guards, we would be able to fight for at least two weeks. ”

"Fight for two weeks, and then what?" Dussander did not show any satisfaction or dissatisfaction with his father's answer, he just asked very calmly, "In two weeks, the fleet can counterattack to Orin?" Or did two weeks later, all the ships of the garrison be destroyed, and Newsal would be a target for the undefended Imperial Guard? ”

A counterattack to Orin is, of course, impossible. The full main force of the two Imperial Guards, which is three times the size of the Newsar garrison. Putting aside the difference in the service life of the capital ships of the two sides, even if you just look at the number, the collision of the two Imperial Guards fleets can completely wipe out the Neusar fleet.

Duchamp was silent for a long time, and then resumed eating the fried egg in front of him, "I am a soldier, and my profession is to resist and destroy the enemy by all means. Other...... That's what you politicians need to think about. ”

"So, please trust my judgment." Dussander also continued to eat the butter potatoes in front of him, and he said as he filled his stomach, "Spending two million gold pounds to interfere with the empire is the best choice we can make now—besides, these two million gold pounds are not so simple as spending them, maybe we can finally earn tens of millions of gold pounds from the empire." ”