Chapter 11 Shorting Wall Street
After robbing the Japanese devils, we also want to rob the American devils. Please help me!
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On September 4, 1929, a small commotion occurred in the New York Stock Exchange Hall on Wall Street, USA.
The U.S. stock market, which lasted for ten years, did not rise or fall when the stock index opened on that day, but stayed at the index at the opening of the 3rd at 363 points.
The commotion was caused by a small group of people who were eager to continue to rise in stocks, but most businessmen and investors were calm because the stock market was suspended and the phenomenon of a stock market was normal. Looking at the bull market economy that has continued to grow for ten years in the United States, they comforted themselves in their hearts that they would continue to rise tomorrow.
In the hotel building, Zhang Meng put down the phone and originally planned to happily see the spectacular scene of the Americans jumping off the building, but he never thought that the stock index did not fall, and instead he frowned.
"It's too dangerous for you to do this, let's give up quickly!"
Zhang Wei looked at Zhang Meng with a worried look on her face. Yesterday, she thought Zhang Meng had made a billion dollars and stopped, but unexpectedly, Zhang Meng suddenly said something amazing.
Short selling Wall Street!
That's right!
Zhang Meng did not intend to withdraw his investment, but continued to speculate on the US stock market after cashing out. However, this time he no longer bought US bulk stocks and rose, but bought US stocks and fell.
Short selling, as the name suggests, is commonly referred to as short selling. Short selling refers to selling all stocks held by investors and hoping to buy the stock at a lower price in the future. When short selling, it is expected that the stock price will fall, and these sold stocks can be bought at a lower price. If the subsequent buying price is lower than the selling price, the net difference between the two is the profit earned by the short seller.
According to Zhang Meng's estimate, the Dow Jones Index will reach its highest point of 363 on September 3, with a small decline starting from September 4, and from October 24, the stock will fall by an average of 2 to 3 points per day. According to the current market price of the stock is $36,300. Zhang Meng expects the stock price to fall to around $24,000. At this time, Zhang Meng used $36,300 to short (sell) 90,000 shares of stocks, and the account is included in $3.3 billion, and the interest is obtained. After October 24, if the stock price falls to $24,000 as scheduled, Zhang Meng can obtain these 90,000 shares for $2.16 billion, and the intermediate difference of $1.14 billion is the profit from Zhang Meng's short-selling stocks.
Of course, this money is not cash. Zhang Meng needs to sell the 90,000 shares of stocks after short selling. As for whether anyone is willing to spend money to buy back this batch of stocks, it depends on luck.
If you use a simple sentence to explain it, the stock market is a casino. Buying up and short selling is like buying big and buying small. After the pressure is over, it depends on God's will.
If it were ordinary people who would never dare to do this, they would be scared to death.
But Zhang Meng knew very well that on October 24, the Hoover administration would gather a group of American banks to intervene, and they would inject huge amounts of funds to turn the tide. Therefore, with the intervention of the government, countless people would believe that the stock market would soar back to 363 points or even exceed 363 points. Therefore, Zhang Meng was not worried that no one would buy his stocks. He just needed to remove all the stocks before the stock market collapsed again on the 28th.
This is Zhang Meng's calculation. He will make another billion US dollars in the next two months before he will return home.
But for those who don’t know the inside story and future changes, Zhang Meng is like playing with fire. Zhang Wei strongly protested, but unfortunately she couldn’t say that Zhang Meng was.
At this moment, Zhang Wei saw that the stock market did not fall like Zhang Meng's prediction, and her worries were naturally reasonable.
Zhang Meng thought for a while and finally realized why the stock market did not fall today. It should be related to Zhang Meng's huge amount of capital investment in the US stock market. After all, Zhang Meng used more than 2 billion US dollars to enter the US stock market. This is undoubtedly a shot of a strong man for the US stock market, so he did not fall but closed his position.
However, Zhang Meng believed that the collapse of the US stock market was the general trend, so he didn't care and continued to wait.
Sure enough, as Zhang Meng predicted, the bull market in the US securities market that lasted for ten years hit the daily limit for the first time at the opening on September 8, 1929, and stopped at 361 points.
This was 5 days later than the first limit down time that Zhang Meng knew, and it was Zhang Meng's huge amount of funds that affected the US stock market.
The stock market hit the limit for the first time, which seemed to be an unusual signal, but the crazy investors were not discouraged. Instead, they bought stocks with reduced prices even more crazily, hoping to make a lot of money after appreciation at the opening tomorrow.
But they were soon disappointed.
In the following time, although the stock market has risen and fallen, the increase is significantly smaller than the decline. Overall, people who buy stocks are losing money.
Seeing the continuous decline of the US stock market, Zhang Wei was shocked again. She couldn't believe that Zhang Meng actually had this kind of prediction ability.
"How did you predict that the US stock market will fall? Could it be that you are really a god?"
Zhang Wei suddenly thought of something. Zhang Meng fell from the sky that day. Although she knew that Zhang Meng had a parachute on her body, she thought that there was no plane passing by in the sky that day, so she immediately looked at Zhang Meng with suspicion.
Seeing that Zhang Wei was staring at him, Zhang Meng felt a little furrowed all over, so he smiled and said, "This is very simple! Look at most Americans nowadays not only buy cars, houses, or business, you go on the street and ask an American to ask them how much their annual salary is. They will tell you about 2,000 yuan, and then ask them how many dollars they brought with the bank, and they will repay the money for the rest of their lives. Even more people have less than 1,000 US dollars annually. This is considered a rich man in China, but in the United States, they can't even be considered a food and clothing."
Zhang Wei couldn't understand Zhang Meng's words and asked, "What's the matter with this stock market crash?"
Zhang Meng didn't know how to explain this profound problem to her, so he had to use a simple example: "What do you think is the difference between this stock market and a casino?"
Zhang Wei immediately said: "I think the stock market is a casino, there is no difference!"
Zhang Meng suddenly smiled and said, "That's right! The stock market is a casino. Have you seen how many gamblers can get money from the casino? How many gamblers will not lose their money after entering the casino? "
After Zhang Meng said this, Zhang Wei immediately understood.
"Yes, the gamblers in which casino don't lose nine out of ten bets, and the more they lose, the less they win! I remember that there were several stock market crashes and plunges in Shanghai. At that time, I don't know how many families were destroyed and my father almost lost all his family."
Zhang Meng knew that the stock market crises in Shanghai had indeed harmed many Chinese people and cheated many people of life-saving money.
"Soon you will see groups of Americans queuing up to jump off buildings. After the US stock market collapses, it will affect various powerful countries, and their people will also be forced to jump off buildings. Just treat it as avenge for those Chinese comrades who have been cheated by foreigners!"
Chapter completed!