Winner Takes It All, Resurrection 2009

“The key issue now is to unite as many people as possible and remove all the hidden dangers buried in the past 30 years before American capital deploys in Eastern Europe.

Only by completely getting rid of the shackles, especially the restrictions on the issuance of soft sister currency, can we go into battle lightly..."

At the end of February and the beginning of March, there were many meetings in Yenching, all of which paved the way for the upcoming plenary session.

Because the position of Qingyun Group is very special, even the special meetings of the banking and finance departments would inevitably call Li Zehua over. After the host finished speaking, he would throw the topic to him.

"For some well-known reasons, the basis for the issuance of RMB since 1993 has been the total amount of the country's foreign exchange reserves. According to the latest data, the total domestic issuance scale is close to 50 trillion.

In fact, it has exceeded the 3.5+3.5 foreign exchange settlement and cang aggregation scale. With the further development of the Guomin economy, especially among private enterprises and foreign trade enterprises, the demand for RMB has further expanded.

At this stage, the current total circulation scale can no longer meet the growing demand, especially since it has only been seven months since the Chinese concept stocks market started to take off.

More than 430 billion RMB was transferred into the financial market and successfully settled through the channels of Bank of China, Bank of China, Industrial and Commercial Bank of China, Minsheng Financial Holdings and HSBC.

We should see the positive side of its active going global, but we should also see the negative impact that a large amount of RMB resources deposited in overseas financial markets may bring...

It so happens that Mr. Li Zehua, Chairman of Qingyun Group, is here today. I would like to ask Mr. Li what he thinks about this, after all, based on your group’s statements in the public market.

In the next two years, your group will initiate large-scale listing of its subsidiaries in Lijiaopo. If the number is as expected, it will reach twenty or even fifty times the current size in two years.

That means that at least close to one trillion, or even more than two trillion RMB, will remain in this settlement system for a long time.

Such a large amount of RMB is outside the domestic supervision. If anything unexpected happens, who will ensure its safety? To put it bluntly, who can guarantee that it will not be used to attack our offshore system? "

Li Zehua looked at everyone sitting there, then looked at the vice president of the institute at the top, and after confirming that the latter gave him a clear nod, he stood up calmly.

The first thing he said was earth-shattering. "Qingyun is just a private enterprise. We cannot make any promises outside of business rules."

For a moment, everyone was stunned, feeling absurd as if they had heard it wrong.

Facing the upcoming widespread doubts, Li Zehua said calmly: "You heard it right, Qingyun cannot guarantee that any dollar shipped overseas will not help the gongji exchange rate in the future."

This is a fact, because even in nearby Hong Kong, foreign capital has short-term dismantled the RMB and used it to manipulate the exchange rate in 98 and recently.

No matter how powerful Qingyun is, it is ultimately just a company. Its control cannot be more powerful than that of a country.

What's more, the city is far away from the local financial market. Should he be asked to guarantee it with his life?
The heads of the Agricultural Bank of China, the China Construction Bank, and the Bank of Communications, who had not gained much benefit from Qingyun Overseas, suddenly felt enlightened.

One of the vice presidents was even impatient to speak, wanting to take the opportunity to set the tone, and wanted to pull this resource into his own territory on the grounds that Qingyun could not assist the CBRC in controlling the security and stability of overseas currencies.

There is nothing wrong with this. After all, it seems that everyone is a company behind closed doors. However, the order of position and the right to speak in the industry all depend on performance and the amount of resources they control.

Minsheng Financial Holdings, a subsidiary of Qingyun, has been conducting internal data analysis on the consumption behavior habits of Internet users for more than a year, with particular support from Weipay and Pinxixi.

It has gradually gained a firm foothold among tens of millions of small and medium-sized businesses and an even larger number of self-employed individuals, and launched many financial support projects with quick approval. In the fourth quarter of 2011 alone, it issued more than 1500 billion in special micro loans.

These funds and core high-quality customers are bringing a steady stream of huge profits to Qingyun, which in turn impacts the interests of the traditional financial industry. Who wouldn't be jealous?

Especially since Qingyun also holds (part of) the decision-making resources for financial overseas expansion, it makes everyone present even more uneasy. If Qingyun is allowed to continue to develop, a super financial freak spanning both domestic and foreign countries will exist for a long time.

Several companies shared the common wish of taking the opportunity to weaken it, clip its wings and its most profitable business. After all, no one wants to have an extra pair of chopsticks on their dining table.

The deputy general manager of the institute, who had been listening, was also confused by Li Zehua's self-exposure, but he quickly reacted because Li Zehua looked very natural and he was not crazy.

On the contrary, it is very interesting that when facing accusations from all sides, he can sit back and do not panic.

If the occasion was not wrong, he really wanted to let it go on and see what twisted ideas people could come up with for the sake of their own interests, but this was a meeting he was presiding over, so he could only come out in advance to break the deadlock.

By the way, it also keeps the meeting topic on track.

As he spoke, Li Zehua secretly felt it was a pity, but he could only reveal his next plan, which was that the RMB that should have remained in the settlement system, in fact only the data was real, and the actual stock was less than one tenth.

As for the remaining money, hehe~
A vice president of Bank of China International frowned and said, "What does this mean? It's just a string of numbers? What if someone wants to withdraw cash on a large scale, or use it for third-party transfers or investments?"

“First of all, we need to clarify one fact, that is, the reason why the US capital agreed to let us take back the controlling stake in HSBC is not out of kindness, but because they want to take the opportunity to stretch the battle line and find weak points to launch an attack.

Although half of Hong Kong's financial autonomy was once in their hands, the RMB stock market has always been small. Even if the surplus in the hands of state-owned enterprises is included, it is only a few hundred billion.

As long as there is any movement, we can raise the interbank lending rate at any time. Even at critical moments, the SASAC, the China Banking Regulatory Commission and the China Securities Regulatory Commission can jointly issue the order.

Any state-owned enterprise holding RMB is prohibited from borrowing RMB resources from abroad. In this way, even if it attracts international hot money to participate, the financial institutions under Squid Capital will be affected.

Because there will not be enough RMB to trade, there will naturally be no threat to the security of the entire exchange rate system.

So after they understood the situation, they decided to move the preset battlefield from Hong Kong. Firstly, the physical distance was farther and we were unable to reach it.

Secondly, with the support of Chinese stocks listed here, the more high-quality domestic companies are listed here, the more RMB will be gathered in the future, and also because the market rules are different.

If something happens, financial institutions will not be able to refuse reasonable borrowing demands from U.S. capital..."

Li Zehua does not need to explain the rest in detail. Short selling depends on whether the chips in hand and market confidence can hold up. If the chips overwhelm confidence, the bulls will not be able to hold on.

If you still have confidence after losing your chips, it means that short selling has failed. It's a very simple truth.

"Isn't this just sending a target for others to shoot at? In the past in Hong Kong, if something really happened, all companies had to cooperate with a written order. If something happened, communication would be a problem.

Moreover, the foreign exchange market emphasizes quick entry and exit, and only recognizes strength rather than logic. Whoever has the stronger fist has the final say. According to the estimated scale just now, the central bank cannot always have a special fund of 300 billion US dollars ready.

Is it to deal with possible market crashes and short selling provocations at any time? "

Facing the doubts, Li Zehua was not at all timid and fought back sharply: "First of all, half of the management shares of Chinese concept stocks are in China, which means that we have the right to interpret the rules.

Secondly, DBS Bank and UOB are only two of the eight underwriters and market makers. Even if we add in Goldman Sachs and JPMorgan Chase, which have always wanted to squeeze in, they only account for 40% of the volume.

According to what the bank president just said, the best expectation in the next two years is that the total scale will be 40 trillion RMB. Okay, % is billion, or more than billion US dollars.

But I want to ask, what is the basis for them to drain all the market liquidity to trade in foreign exchange? If anything goes wrong in the middle, who will be responsible? This is no joke. If the worst happens, Goldman Sachs will lose everything. I don't believe Goldman Sachs dares to lose everything it has just for that momentary exchange rate fluctuation. At most, it can make tens of billions of dollars, but if it loses, it will lose everything. Who dares to play like this?"

Li Zehua sneered: "Not to mention that Gaosheng's entry requires our consent. They can add two new positions, and we can also add an internal passage according to the agreement reached in the negotiation.

This ensures that we always have the initiative!

Furthermore, DBS and UOB do not dare to act rashly, because the total amount of RMB settled through them must be remitted into the public account of the Chinese concept stock market according to regulations, and they have no right to use it.

It's impossible to say that all the shares worth hundreds of billions of RMB were sold for cash at the same time, right?

Someone has to be able to take on such a large order, so theoretically this situation is impossible!
Finally, Qingyun has signed supplementary clauses with the other seven companies, a joint agreement on the centralized use of the existing RMB on the books..."

The content of the agreement is very simple. Because the use of RMB has to go through layers of approval, Qingyun and its friendly companies both sought special exemptions at the beginning of the negotiations on Chinese stocks.

That is, after RMB participates in the trading of Chinese stocks through open and legal channels, it will not come back easily in principle, even if user A sells 100,000 RMB stocks and withdraws the cash to a domestic account.

In the settlement system of the central bank, this 100,000 quota can only continue to be registered in the form of accounting, and the quota itself is still out, which is equivalent to a liquid market value of 1 trillion yuan for Chinese stocks listed in the United States.

And the market value must be publicly bought by institutions or retail investors and continuously traded or held, so there will be an equal amount of RMB existing in the overseas financial settlement system.

Qingyun does not intend to leave this money idle, but to use it to support the plan of borrowing US dollars to repay RMB, and it will get support from the central bank and the finance department.

Simply put, once the plan starts, it will be easy for American capital to bear a grudge against it, and they will use various means to interfere. Moreover, due to the lack of internal legal support, Qingyun cannot do it openly.

Simply use the funds deposited in the Chinese concept stock market to secretly support the smooth implementation of the major plan. Lending US dollars to a third party is real money expenditure, but how can the other party have the same amount of RMB?

It is not possible to quickly establish mutual trust in a cooperative transaction from the beginning, and the third party may not have a large amount of cheap and competitive raw material resources.

Even if they do exist, they may not be controlled by local groups or Dongda Capital. For example, Malaya is in a similar situation. Many key resources are controlled by Squid Capital. It is very difficult to successfully negotiate a cooperation agreement!
This resulted in the plan of borrowing US dollars and repaying RMB not going smoothly from the start.

After much deliberation, Qingyun decided to take advantage of the micropayment platform and directly lend RMB to users in need (mainly enterprises). After receiving the RMB, the latter would establish cooperative relationships with domestic enterprises.

With RMB, local companies can import equipment and technology from major Dongda companies and establish their own preliminary processing industrial system locally, thereby creating competitive products.

In turn, they export to overseas markets and earn a variety of foreign currencies including RMB and US dollars.

(Even if there is a lack of such awareness in the local area, Dongda Capital, which has gone overseas on a large scale, can pretend to be a local enterprise and carry out similar economic means in the local area.)
After establishing connections through foreign trade, the scale of bilateral cooperation was expanded little by little. Southeast Asia has a large population and is actually coveting many local resources, even though key copper, iron, gold, silver and agricultural resources are monopolized by foreign capital.

Sometimes a country lacks a competitive advantage due to price factors, or sometimes does not qualify for export due to other factors, but there are always some resources that are not controlled by foreign capital and can be used for trading.

As long as a relationship of mutual benefit and trust is established, Dongda's industrial products will continue to enter the country's market, coupled with the economic influence established locally by major groups that have gone overseas in advance.

Over time, won’t the target third party have enough RMB (or other foreign currencies such as US dollars) in its hands?

When the debt matures, the target country will have acquired a primary processing industrial system and successfully repaid all foreign debts, while the market will be opened to Dongda capital because of the equal cooperation.

The most critical thing is the subsequent industrial upgrading, which will require a continuous purchase of equipment and technology from Dongda. This is the influence. Once the relationship turns against each other, the cost of the other party's systematic replacement will be so high that no one can accept it.

Therefore, as long as we take the first step and achieve a certain scale, it will be clear who has the final say in the future.

The most important thing is that Todai does not need to worry about cultivating a competitor, because there is no region in Southeast Asia that has the unique full industrial system foundation like Todai.

In addition, human control during the transfer process can basically ensure that there will not be too much deviation in the general direction.

The transfer of division of labor in the process of economic development is inevitable. As the overall industrial level develops to a certain stage, projects with backward production capacity will inevitably be eliminated.

For example, the shipbreaking industry and the waste disposal industry (if you are interested, you can check that before 2016, Dongda was the world's largest site for the disposal of toxic hazardous waste.)
These all need to be taken up by the corresponding markets in advance. Otherwise, the demand will still be there, but the cost will be too high, which can easily lead the entire industry into a ditch. By then, they will either cut corners or fool each other.

The core of borrowing US dollars and repaying RMB is that the target country must have the ability to solve the actual needs of the East and bear the ability to consume part of the East's industrial products, otherwise it will be in vain.

The prerequisite for all this is that they must first have RMB (purchasing power). Of course, they can also pay directly in US dollars, but the local areas are usually heavily in debt and have no ability to complete the payment at all.

(Simply using goods to replace debts cannot directly benefit most people, so it cannot last long.)
If Todai gives it directly, there will be too many things to discuss and it will be easy to be affected by the interference of the capital. Too many variables will be disadvantageous.

It would be more efficient and easier to reach cooperation if Qingyun and the four major groups came forward to negotiate.

It’s not that no one has raised questions. For example, a vice president of the State-owned Assets Supervision and Administration Commission could not help but frown and asked, “What if the money is spent but the cooperation is not concluded in the end?”

"Bank loans also have a bad debt rate. Qingyun and the four major groups are only responsible for providing money and ensuring that the overall rate of return is controllable, but no one can guarantee whether each loan can be successfully recovered."

Li Zehua said this, but in his heart he was thinking about the number of people entrusted to the Governor's Office for training. It was not a large number. It would be a maximum of 300,000 people within two years.

At that time, with the support of translation tools provided by QingCloud Software, they will begin to penetrate the Asian, African and Latin American markets and carry out extensive business layout, during which they will also inevitably carry drones for field surveys.

Whoever has a mine or resources can, if all else fails, farm and produce crops in exchange for RMB. By then, Qingyun will have first-hand core information. If everyone plays by the rules, everyone will be happy and get rich together.

But if anyone wants to play dirty, the drones used for surveying and the little gadgets used for applying pesticides on the land don’t mind transforming themselves into something that everyone loves to see, and sending to hell anyone who tries to break the contract and take advantage.

Qingyun is just a pure business group and is only responsible to the investors behind it. They will be unhappy if anyone makes them lose money. Mr. Li doesn't want to take responsibility himself, so he has to send the troublemaker down to completely solve the problem.

Of course, they still appear to be honest on the surface, saying that the overall rate of return will not be affected. Finally, they have to submit the audit and supervision results in exchange for the consent of all parties.

As expected, upon hearing that they would not be held responsible and would still be in charge of the final decision, several large state-owned banks attending the meeting immediately changed their stance and became overwhelmingly supportive.

The vice president who chaired the meeting also breathed a sigh of relief and concluded his speech: "... Overall, the situation is under control, which is very good...

But I think we can do better. For example, Mr. Li, you can further optimize the details of the cooperation, such as adding restrictions to prohibit Luo's short selling.

It is not possible to openly call for huge amounts of RMB and engage in speculative profit with just an interbank lending contract.

I think if the banking industry wants to participate in the international RMB pricing, it must first prove that it actually owns that much RMB..."

Li Zehua thought seriously for a while before saying, "You are really good at seeing the big picture from the small details. I will have someone draft relevant topics as soon as I get back. I hope you can give me more guidance then...

(End of this chapter)