money player

After the waiter brought the coffee, Sin Yiu-man took a sip and said unhurriedly, "Mr. Mak, I will give you 2 yuan as a guarantee. Regardless of profit or loss, you will receive this money."

As he spoke, he waved his hand, and Xie Zhanran handed him a brown paper bag.

He placed the brown paper bag on the table and pushed it to Mai Zhihong, saying, "Please put it away first, and count it when you get back. Remember to give me a receipt after you're done counting it."

Upon hearing this, Mai Zhihong immediately picked up the brown paper bag and put it into his briefcase.

"I plan to invest 300 million to short rubber futures, but I want to sign a 1000 million betting agreement. Can you do that?"

After a moment's thought, Mai Zhihong said, "Yes, but a guarantee is required."

"No full guarantee, a credit line of 300 million plus HSBC's 100 million USD."

"Demand full collateral from the counterparty?"

"Yes."

"It's hard."

"You take 5%."

Mai Zhihong paused for a moment, then said, "10%."

Sin Yiu-man waved his hand, "Your efforts aren't worth that much. 6.5% is my bottom line."

"A contract settling on November 30th?"

"Yes, be prepared to close out your positions in mid-November."

"it is good."

"The details are the same as last time; contact Wang Changhui."

new York.

In a quiet bar, Zheng Huixian and Jacob Rogozinski sat facing each other.

“Jacob, in a couple of days the gentleman will be wired $200 million to you. He would like you to use 15 times leverage to buy shares of Mansfield and Cyberlink.”

The US tire industry has four major players: Goodyear, Firestone, Union Tire, and Graitch. Below these four are Mansfield and Cybring.

"If you want to get $2800 million in financing, you can only go to Kuhnleb Company."

"How much is the interest?"

How long do you plan to hold the stock?

"End of the year."

"We can negotiate 2%, but collateral is required."

"Is a share in the flower company acceptable?"

"can."

“Jacob, your commission manager will speak with you personally.”

London.

It was already past midnight, but people were still working overtime in Dean's office.

In Sin Yiu-man's CEO office, Eve Ashley, with a cigarette between her fingers, said to Dennis Brown, a director of Harrisons & Crosfield, sitting opposite her, "Mr. Brown, I would like to sell 65,000 lots of December contracts with a margin of £1 million."

Harrisons & Crosfield, Lewis & Peat, and Gill & Duffus are the three major rubber brokers in London, and also the three giants in rubber planting and distribution. Together, they control 55% of the world's physical rubber.

Dennis Brown puffed on his pipe for a long time before saying quietly, "Too much. Halve the quantity, and I'll allow you to close the position without spot trading, but I'll give you slippage."

"Thank you."

After finalizing the deal, Dennis Brown walked away with a limp, his back hunched, as if he had aged ten years in an instant.

Harrisonke Rothfeld currently holds over 100,000 tons of rubber inventory, most of which was stockpiled at the beginning of the year at a high price. The sharp drop in natural rubber prices in the last quarter of this year is inevitable, a fact that all three giants are aware of.

On one hand, they have a large amount of stockpiled goods, and on the other hand, the market is set to crash. What can these three companies do?
Are they "secretly" speeding up shipments before prices plummet?

With the "three major giants" and "55% of the actual rubber supply" as objective conditions, there was simply no possibility of them doing it secretly. If they dared to dump their shares, the price of rubber would plummet, and all three companies would be finished.

At that time, at the end of August 1951, anyone who could be called a financial professional or arbitrageur had already seen that rubber prices were about to plummet. No one dared to go long in large quantities; at most, they would play around with small bets for a chance.

The main bullish forces in the market are actually just a few gamblers, and the vast majority of them share common characteristics—black eyes, black hair, and yellow skin; they are descendants of the dragon forever.

They are small rubber plantation owners of Chinese descent in Singapore, Malaya, and Indonesia. They lack financial knowledge and the concept of hedging, but they are ambitious, firmly believe that human will can overcome nature, and have the bad habit of regarding small profits as huge losses.

I originally planned to earn 100 million this year and then take a concubine, but now that I see the price of rubber, I estimate that I will only earn 60 by the end of the year, and I will actually lose 40. How can I accept this?

No, I'm going to go long on rubber futures and try to make 200 million by the end of the year so I can marry a pair of twin beauties.

Many people share this idea, but none of them are particularly strong. Even if they pool their resources together, they can't possibly take on 6.5 lots in one go. They can only stretch out the timeline and gradually increase the volume.

Clearly, Dean Group has no intention of operating in the long term; what they want is to dump their shares in the short term. If there aren't enough long positions to take over, then they'll force the real big players to become long positions. The so-called big players are the three giants.

To put it bluntly, the 6.5 short positions Ashley mentioned were intended for Harrisonke Rosefield. Dean Group dumped the shorts, Harrisonke Rosefield quietly absorbed the short positions, and then quietly dumped them out in smaller increments.

The word "quietly" is quite intriguing. According to the margin system of the London Rubber Terminal Market (the official name of the exchange), a margin of £100 million is only enough to operate 6500 lots. If you want to short sell 6.5 lots, you must have £1000 million in the margin account. Ashley's subtext is that he wants Harrisonke Rosefield to add £900 million or more.

Right now, Harrisonk Rosefield's best strategy to minimize losses is to short the futures market extensively, but Harrisonk Rosefield is both a participant and a referee, and the exchange cannot allow him to act arbitrarily.

The exchange has unspoken rules against speculation: the same member's short selling cannot exceed 25% to 30% of the total trading volume per day. Harrisonk Rosefield's own account could only short sell a maximum of 1500 to 2000 lots per day. Any more than that would be reported by other brokers for market manipulation, and the exchange would investigate or even suspend trading.

It's different when it's under the Dean Group's name; it can be spread across seven or eight seats, and Harrisonke Rothfeld can secretly add a few more. On the surface, it's a market-driven activity, and no one dares to investigate.

Secondly, bank margin regulations are the most stringent for agents. If an agent's account is liquidated, the entire market collapses. Dean Group can operate 6500 lots with 100 million pounds. If Harrisonke Rothfield were to operate the same number, the margin would need to be multiplied by 4 or 5, meaning he would not be able to obtain high leverage.

In addition, Harrisonke Rothfield also faces pressure from shareholders. If the annual report states "we shorted 8 lots for hedging," British aristocrats, pension funds, and other shareholders will be furious: "You damned bunch, you should be called 'Family x 9 = 0'! You knew the rubber price was going to fall, so why did you let us buy plantation shares at such a high price in the first place?"

Executing spot hedging for clients is different; it's perfectly compliant, you can earn commissions, the annual report looks great, and shareholders and auditors will keep quiet.

Finally, there is a shortage of opposing positions. Without any real bullish buyers to take over, Harrisonck Rosefield inevitably has to play a game of shifting positions from one hand to the other, and he desperately wants real opposing positions to enter the game, even if they are short sellers.

For these reasons, Dennis Brown agreed to Ashley's request for a high-risk, high-reward strategy, but then proposed halving the stakes, wanting to give Harrisonke Rosefield more room to maneuver.

For Harrisonke Rothfield, the goal is to survive, and to minimize losses is a victory, even though Dean Group is essentially taking a cut from its business.

Based on current market conditions, Dean Group could expect a return of approximately 510% by closing out its position in December, turning a £1 million investment into a profit of over £5 million.

Ashley poured himself a cup of coffee, lit another cigarette, and waited for news while he pondered.

In the large office outside, George Soros, who was working hard to support himself, poured coffee for everyone before returning to his workstation to continue reviewing information about cocoa.

Some of his views have changed; finance is clearly more attractive than philosophy. He has begun to admire the long-absent BOSS, and not long ago he earned his first pot of gold, a full £500.

Rio de Janeiro.

In Vogue, the city's most famous nightclub, Lin Anna sat in a booth, gazing tenderly at her boyfriend Quan Xu, who was singing on stage.

Quan Xu held the microphone with one hand and had his other arm around the dancer's waist, dancing the samba while humming "Blame It on the Samba".

"Was looking at you and her smile was so shy, Girl that I just seen walking by, Beauty of the scene, We're gonna dream on, Dreamin' on the dream."

Quan Xu swayed his hips, tapped Lin Anna a few times with his index finger, and then gave her a flirtatious look, "One, two, three, let's dance the samba together to dispel our dissatisfaction, vent our frustrations, let's dance the samba together to shake off our discontent, and exchange pleasure for trouble~"

He took the beer bottle from the dancer and raised it to the man sitting in another booth.

He took a sip of his drink, finished singing a song, and led the dancer to the man's booth, sitting down next to him. "Americo, you're late."

“Brad, I need to work.” The man was Dr. Americo Simas from the Rio office of the Brazilian Cocoa Institute, a new friend of Quan Xuxin’s. He picked up a document from the side and handed it to Quan Xuxin. “The statistics for this year’s cocoa production are ready: 14.18 tons.”

"So fast?" Quan Xu exclaimed, feigning surprise.

“It wasn’t supposed to be finished until the end of the month,” Americo Simas shrugged. “But you gave everyone gifts.”

Quan Xu flicked the file with his finger, "Please thank everyone for me, and come to my place for a barbecue this weekend."

"OK."

Three o'clock in the morning.

Ashley held the newly received fax in her right hand and a pen in her left, circling figures on it. She circled five sources representing Brazil's cocoa production figures for this year: the Brazilian Cocoa Institute, the Brazilian Foreign Trade Institute, the British Consulate Commercial Section, the US Embassy Agricultural Attaché's Office, and the Rio Port Exporters Club.

Upon comparison, the five numbers were almost identical. She immediately got up, went to the outer office, clapped her hands, and said, "Everyone, go back to sleep now. We'll start work tomorrow."

"Wow!" Everyone shouted in unison, using the traditional cheer from Poultry Street, "Cheers to the floor of the exchange!"

"Let's give our old buddies three rounds of cheers!"

I love chocolate!

The start of the project is a major undertaking, and all participants will receive bonuses and dividends.

Tokyo.

Chiyoda Ward, Kasumigaseki.

This area was the concentration of various ministries and agencies of the Eastern powers, and also housed the office buildings of large companies such as Teikoku Life Insurance, Mitsubishi Corporation, Mitsui & Co., Toyo Steel, Tokyo Gas, and Teito Electric Light.

Next to the Mitsui & Co. office building stands a three-story building, which belongs to Mitsui & Co. and was rented by Keiko Nagumo as the headquarters office building of the Uyato Trading Company.

In the president's office, Keiko Nagumo and Hajime Iijima, president of her company, Yamato Foods, and Kozo Saito, president of her subsidiary, Daiwa Natto, are discussing business.

“会长，目前最大的三个纳豆品牌是朝日纳豆本铺的旭纳豆、大纳言本铺的大纳言、高梨纳豆制造所的高梨；三家的日均产量分别为2万把、1.5万把、1.2万把；市场占有量分别为10.2%、7.6%、5.8%；三家的企业推定价值为2.3亿円、1.9亿円、1.4亿円。”

No sooner had Saito Kozo finished speaking than Nagumo Keiko immediately asked, "Mr. Saito, which company do you think is the easiest to acquire?"

Saito Kozo nodded slightly and said, "Chairman, I think Takanashi Natto is the easiest to acquire."

Keiko Nagumo looked at Hajime Iijima and said, “Mr. Iijima, I’m giving you a budget of 3 million yen. You must acquire one of them within 10 days and merge with the other two within a year. I need to see the plan by tomorrow morning.”

Hajime Iijima bowed and said, "Hai."

Raffles Hotel.

Xian Yaowen was reading the newspaper. Wang Youjia sat next to him, one hand reaching into his suit jacket to gently stroke his back. Song Chengxiu, who had come over to join him, sat down opposite him.

Without looking up, he asked, "Chengxiu, what was the soybean planting area in the United States last year?"

Song Chengxiu replied briskly, "1240 million acres."

"What about this year?"

1480 million acres.

"Why are there 240 million more acres this year than last year?"

"The demand for military supplies and strategic reserves during the Korean War exploded, and the US government made unlimited purchases of 90% of the supplies at par value, leading to a surge in expected prices and farmers rushing to plant crops."

What's your opinion on soybean prices this year?

After a moment's consideration, Song Chengxiu said, "In March, the US government's purchase price was reduced to 80%, and at the beginning of this month it was further reduced to 75%, and a purchase cap was set at a maximum of 2000 bushels per household. This year, Iowa and Kansas have had favorable weather, resulting in a high soybean yield, which is expected to be around 9.6 million tons this year."

Based on last year's domestic consumption for crushing and food processing in the United States, approximately 410 million tons remain available for export.

The largest customer for US soybeans is Japan. In March, Japan had already secured imports of over 1.4 million tons, while exports to other countries were negligible. This year, there will be a surplus of 2.4 million tons of soybeans.

Due to the embargo, China will not export soybeans to the West this year, and will only trade with the Soviet Union. This is fatal to international soybean prices.

Xian Yaowen raised his head and chuckled, "Why?"

Song Chengxiu smiled and said, "If China were still selling soybeans to the West, we could at least blame the low prices on the Soviet Union. But now the Soviet Union has taken all of China's soybeans, so we can only blame ourselves for planting the biggest pile of unwanted soybeans in history."

This was said by a senior alumnus of mine who works at the Chicago Mercantile Exchange: "China's decision not to sell soybeans to the West is a major negative factor and could be the final straw that breaks the camel's back for soybean prices."

Sin Yiu-man nodded slightly. "If Chinese soybeans don't go to the West, the already excessive inventory pressure on US soybeans will escalate to an overwhelming level, amplifying the negative impact several times over. How many lots can we trade with $20 now?"

Song Chengxiu quickly calculated, "I can establish a position of 130 lots."

“I’ll prepare $220,000 for you, with an extra $20,000 for margin calls. You can short the December soybean contract and hold it until the last trading day before expiration, December 28th.”

Xian Yaowen gestured to Wang Youjia, "If we make money, she gets 5%, and you get 5%."

As he spoke, he placed the newspaper on the table, turned it to face Song Chengxiu, and pointed to an article, saying, "Take a look."

Song Chengxiu, excited about the 5% profit dividend, looked at the newspaper. The first thing she saw was the word "cotton," and her excitement grew even more. Chicago soybeans were facing a major downturn, and New York cotton was not far behind.

In the Dean Group office, Ashley was still sitting in his executive chair, holding a document about London Tin.

As the saying goes, short selling should be high-profile, while going long should be low-profile. Rubber and cocoa are examples of short selling, which can be done high-profile, letting everyone in the company know. Tin, on the other hand, is a special case, so it should be done quietly, without firing a shot.

Sin Yiu-man took out another newspaper, flipped to an article related to tin ore mines, took a sip of coffee, and scanned the article at lightning speed. (End of Chapter)