As of January 1990, the Gulf region has proven that oil reserves account for 65% of the global total oil reserves and 43% of the world's oil demand. Among them, Iraq and Kuwait are only the two countries. Even after the subsequent decades of mining, oil reserves still rank in the top ten in the world.

Therefore, it can be imagined how strong the turmoil in the Gulf region will have on the world's crude oil supply.

When news of Iraq's invasion of Kuwait came on August 2, international crude oil prices began to soar rapidly. As of the close of Friday, August 3, international crude oil prices had soared to US$27.63 per barrel, an increase of 29% compared to before the outbreak of the war.

Moreover, this is obviously just the beginning.

Simon just remembers that in the original time and space, the crude oil price caused by the Kuwait War was US$41.07, on October 21.

Because of the influence of Simon, the big butterfly, many things are no longer so sure. However, Simon believes that the problem of international crude oil prices hitting the high of US$40 this time will not be too big.

New York.

Cersei Capital Headquarters at Rockefeller Center in Midtown Manhattan.

Although it was Sunday, Cersei Capital's headquarters is still crowded today, and even the teams of Apollo Management and Black Rock Asset Management are quite excited.

In addition to losing some profits in the last week before the war due to short clearance, Cersei Fund Management's layout in various types of crude oil futures contracts basically met expectations.

As of August 2, Cersei Fund Management Company established huge long contracts totaling US$25 billion on mainstream Brent crude oil futures and WTI crude oil futures, as well as surrounding light diesel futures, unleaded gasoline futures, high sulfur fuel oil futures and other types of crude oil futures.

Cersei Capital began to build positions since the end of June, with the price of international crude oil as the basis, ranging from the lowest price of $13 to $20 the day before the war broke out.

Starting next week, Cersei Capital will gradually clear its long contracts.

In fact, this incident began on the day the war broke out.

In fact, it was because I had to take the initiative to do so.

Simon wanted to start clearing the position when the crude oil price was close to or reached $40, but this was simply unrealistic.

As we all know, futures trading is a zero-sum game. If someone makes money, someone will definitely lose money, and profits and losses are equal.

For example, if Cersei Capital itself puts the wrong direction this time and establishes a crude oil futures short seller of up to US$25 billion, then once the war breaks out, international crude oil prices soar from US$20 before the war to a maximum of US$40, an increase of 100%. According to futures contracts, Cersei Capital theoretically has to pay a huge sum of US$25 billion to the other party.

However, Cersei Capital account has less than $6 billion.

If the bulls insist on refusing to close their positions within the range of loss of Cersei Capital, Cersei Capital will have to default.

Breach of contract in futures trading is very rare, but it is not without it. For example, the violent fluctuations in crude oil prices caused by this sudden war. Perhaps before the war broke out, some futures speculators could continue to replenish margins with the hope of being inadequate. After the war broke out, their hopes were shattered. Many futures speculators directly chose to give up. Some speculators who took a high leverage of nearly 20 times directly breached the contract on the day the war broke out.

However, breach of contract by speculators does not actually mean breach of futures contracts.

Because there are two guarantees between futures brokers and futures exchanges.

When the accounting funds of futures speculators are not sufficient to make up for the losses, as the party to the transaction guarantee, the futures broker will invest to fill the difference to ensure that the transaction proceeds.

When the funds of futures brokers cannot ensure the completion of the transaction, the futures exchange will use its own reserve funds to subsidize.

In the most serious case, in order to avoid the collapse of the futures trading system, the national level will also participate in the rescue.

In the stock market crash in 1987, the S&P 500 futures caused a federal rescue measure due to the huge fluctuations on Black Monday. On the evening of October 19, after direct intervention from the Federal Treasury Department, major U.S. banks were able to provide huge funds to the Chicago Mercantile Exchange to avoid defaults.

Because of the unexpected war, this time, crude oil futures trading also reached the exchange level.

This also means that if the winning side is gambled between $5 billion and $5 billion, the only one who wins can get is not only $5 billion at the speculator level, but also the large amount of funds subsidized by futures brokers and futures exchanges to ensure the delivery of contracts.

Interior of the conference room at Cersei Capital Headquarters.

The meeting ended, it was already evening, and the summer sunset penetrated through the gaps in Manhattan's tall buildings and entered this office building with excellent views.

Sending everyone else away, Janet got up and sat in Simon's arms, humming to show that he was tired.

Simon smiled and helped her to knead and relax, saying, "After this time, there are probably many futures brokers who are going to close their doors directly, right?"

Since this big market has affected the exchange level, middle brokers are naturally unable to escape and often need to fill large amounts of funds to ensure delivery. Relatively speaking, long profits will not feed back too much from brokers, and they can only get a commission they deserve.

"There are probably hundreds," Janet said lazily, "In addition to large brokers supported by parent companies such as Goldman Sachs, Morgan, and Citi, many small and medium-sized independent brokers are basically closing down."

Few speculators can cooperate directly with futures exchanges, and they usually require futures brokers to help them.

There are many types of futures brokers, and half of the larger ones are affiliated with futures brokerage departments under large investment banks. However, there are countless small and medium-sized futures brokers in North America, countries, cities around the world.

In Simon's memory, because of this big market, countless futures brokers around the world declared bankruptcy, and the entire industry will be in a slump in many years to come.

Moreover, this incident also caused another consequence, and crude oil futures trading shrank sharply.

For a long time to come, there will be no more short positions in the market. Cersei Capital will not be able to build positions on a large scale, so it can only turn its attention to other areas.

With the outbreak of the war, stock markets in countries around the world experienced a sharp decline.

On August 2 and August 3, the S&P 500 fell from a high of 371 points to 356 points at the close of Friday. In the next period of time, it is likely to fall to the lowest level of 300 points. In order to focus on the crude oil futures market, Cersei Capital was not distracted from establishing a short futures seller of the S&P 500 index. Now that it is entering the market, it is also impossible to do much.

In the plan, Cersei Capital will complete the clearance next week.

In the future, Cersei Capital only has a large amount of funds, because of the sharp shrinkage of various types of transactions, it is difficult to achieve much more.

After the weekend, entering a new trading day, crude oil prices continued to soar.

The situation in the Gulf continues to rise.

On August 7, the Bush administration formally approved the "Desert Shield" operation, and federal troops officially entered Saudi Arabia to resist possible Iraqi invasions.

However, when the Desert Shield program began to be implemented, an anti-war wave broke out in the United States. Both the media and the public were very worried that the Bush administration would drag the country into another protracted "Vietnam War".

The direct confrontation between the federal army and the Iraqi army in Saudi Arabia also means that the promises that the United States did not interfere with Iraq and Kuwait were empty talk.

At the same time, from August 6 to August 10, Cersei Capital also quickly completed the closing of huge long positions.

The reason why longs with more than US$20 billion can complete the delivery so quickly is mainly because both short futures speculators, futures brokers and futures exchanges are more urgent than Cersei Capital. As international crude oil prices continue to rise, the losses will increase by one point for every day delayed.

On August 11, when Cersei Fund Management completed all financial delivery summary, the net asset value of the hedge fund had increased from the initial $3.5 billion to $12.637.21 million. In less than 8 months, Cersei Fund Management had achieved an investment return of more than 260%.

This time, although Simon only accounts for $1 billion in the principal of $3.5 billion, the fund's commission ratio is only 20%, and 30% of the profit commission is required to be distributed to other partners of Cersei Fund Management. However, based on the net asset value of $12.637 billion at this time, Simon can obtain a profit and commission number in addition to the principal of $1 billion reached $3.367 billion.

In the next few months, even if Cersei Capital's earnings are 0, the total amount of cash Simon hoarded overseas will be close to $8 billion after the planned end-of-year settlement return.

It can be said that even if the capital gains tax factor is considered to be transferred to the country, Simon can basically complete the acquisition of MCA through his own funds.

In addition, although Simon can only obtain one-third of the profits of Cersei Fund Management this time, it has largely eliminated some potential hidden dangers brought about by Simon's rapid rise in recent years through profit sharing.

Moreover, the profit of more than $9 billion seems to have been divided into a large part, but except for the Johnston family, who owns $500 million in principal, the other Australian and American investors have split up and the profits they get are basically less than one-tenth of Simon's.

Simon himself is still the one who makes the most profits.

After finishing a week in New York, Simon and Janet returned to Los Angeles together.

The next phase of the instruction received by the Cersei Fund Management team is free hunting, and the Simon and his wife no longer need to stare at them all the time.

With its 30% stake in Cersei Fund Management, the team's 6 partners are very likely to receive dividends of over 100 million US dollars this year. Even ordinary employees have a huge expected bonus, so the team is full of confidence.

Back in Los Angeles, it was August 13.

The North American summer season has come to an end and has not been greatly affected by the outbreak of the war.

Previously on July 27, "The Hand of Shaking the Cradle" collaborated with Daenerys Entertainment and Disney was released in North American theaters, with a screen opening of 1,632 yuan. The box office in the first seven days of the week was 21.18 million US dollars, which was not as good as the previous "Sleeping with the Enemy", but it also reached a level of over 10,000.

From August 3 to August 9, the box office of "The Hand of Shaking the Cradle" fell by 23% the next week, and closed at another $16.33 million.

The total of $37.51 million in two weeks is US$37.51 million. Compared with the production cost of $11 million and the promotion budget of $6 million, the project has begun to generate profits in half a month. However, it is difficult for "The Hand of Shaking the Cradle" to achieve a box office of $80 million. It is expected that the box office in North America will be around $80 million.

Of course, although it did not meet expectations, a low-cost thriller movie with an investment of $11 million was able to win a box office of $80 million in North America. Neither Disney nor Daenerys were dissatisfied with it.

On August 10th, "The Ghost Chasing 3" produced by New World Pictures, a subsidiary of Daenerys Entertainment, will be released.

This horror series, which started at the end of the summer season, started with 1,329 screens, with a box office of 6.13 million US dollars in the first week, which is not outstanding or failure. It is expected that the total box office in North America will still be between 15 million and 20 million US dollars, and Daenerys Entertainment is expected to make a profit.

However, because there is no big breakthrough in two consecutive sequels, the subsequent sequels of New World Pictures are directly released through videotapes and cable TV platforms. On the one hand, this can save costs, and on the other hand, it can also free up time for other movies produced by New World Pictures.

"The Love of Man and Ghost", which started in Daenerys Entertainment's summer season, has reached 11 weeks of release on August 9, and the cumulative box office has reached US$149 million. The overall box office figure continues to move towards the US$200 million mark.

"Sleeping with the Enemy" collaborated with Fox, in its eighth week of release, the cumulative box office has reached 93.81 million US dollars, steadily reaching the 100 million yuan mark and is expected to hit higher box office numbers.

In addition, the box office of "Mutual Ninja Turtles", which has been released for only five weeks, has reached US$103.53 million in North America, exceeding 100 million in "Sleeping with Enemies" ahead of schedule. However, due to the continued large decline, the box office of "Mutual Ninja Turtles" has dropped to less than US$5 million in a single week, and it is expected that the box office potential of less than US$20 million is left.

Without considering overseas funds, Daenerys Entertainment only brought Simon a net profit of more than $500 million in the first half of the year. In order to avoid the continued depreciation of large amounts of cash in hand and while taking into account the acquisition of MCA, Simon also began to consider more investments in other directions.

Speaking of which, the reason why rich people can get richer is roughly because of this.

Of course, the acquisition of MCA in the second half of the year is still the top priority of Simon's plan.

The outbreak of the Kuwait War triggered a decline in the stock market, and MCA's stock price naturally cannot be spared.

However, from August 6 to August 10, the MCA stock price fell by 9%, and the stock price per share fell to less than US$40. By the new week on August 13, the opening price of MCA stock has fallen to US$39.25. This decline in stock price even failed to stop Panasonic's intention to acquire MCA.

Although Panasonic's acquisition of MCA has not been made public since the last time Michael Orwitz was accidentally knocked out, this incident is no longer a secret in the eyes of many people. The news that Michael Orwitz privately met with members of the MCA board of directors was also unexpectedly exposed.

However, due to the bursting of the Japanese economic bubble, Japanese corporate giants generally need to first ensure that their operations will not be affected by the economic crisis.

Moreover, Sony's acquisition of Columbia Pictures has caused Panasonic to keep paying 'tuition fees' in Hollywood this year. Although Panasonic has accumulated more than $12 billion in funds overseas through accumulation in previous years, which is easy to complete the acquisition of MCA, the industry generally predicts that Panasonic's acquisition of MCA will be more conservative and will no longer be as generous as Sony.
Chapter completed!