America's No. 1 financial conglomerate

Chapter 624 An Unexpected Enemy

(I'll add a free chapter here, since it was my own mistake.)

December 12th, evening.

After dinner, Monica Bellucci went back to her bedroom early.

In the living room, the flames in the oak fireplace leaped, casting a warm glow into every corner of the room.

Ernst and Wenger sat side by side on the sofa, leaning slightly forward with their hands crossed in front of them.

"They're using me as a pawn."

Whenever a major political scandal breaks out in the United States, there is often an invisible force pushing behind the scenes to expose a larger media hotspot to cover up the incident and divert public attention.

This has long been an unspoken game between Washington and Wall Street, where the intertwining of power and capital has buried the truth in the clamor of public opinion.

As a hedge fund with significant influence in the global financial market, the collapse of Long-Term Capital Management will undoubtedly attract considerable attention, with an impact sufficient to shake the entire Wall Street and even the global financial system.

If Ernst's affair and the accusations made by his media outlets were proven true, they would obviously attract more public attention.

This leader of America's younger generation will instantly fall from grace and become the target of public criticism.

America has begun to enter the era of entertainment to the death. The public has a natural curiosity about the private lives and scandals of celebrities. Those unsubstantiated gossip stories can easily occupy the headlines of major media outlets and become topics of conversation for people.

While diverting attention from the crisis at Long-Term Capital Management, it also thrust him into the spotlight.

Wenger raised his whiskey glass, took a small sip, and felt the spicy liquid slide down his throat, bringing a burning sensation that also made his mind clearer.

He put down his glass, looked at Ernst, and agreed with his statement: "Clearly, Goldman Sachs is preparing to take on the huge bombshell that is Long-Term Capital Management."

"They understand very well that even if this bomb explodes, the Federal Reserve cannot ignore it. As the global financial center, the stability of Wall Street is directly related to the economic lifeline of the United States. Once Long-Term Capital collapses completely and triggers a chain reaction, the entire US financial system will face a huge shock."

"As the central bank of the United States, the Federal Reserve bears the heavy responsibility of maintaining financial stability and will never sit idly by."

"Moreover, Wall Street is well aware that since Long-Term Capital Management has not yet defaulted on its bonds and everything is still under control, they have a trump card."

"As long as Long-Term Capital Management's bonds do not default and the risk exposure is contained, surviving a week will be a victory for Wall Street."

Ernst nodded slightly, understanding that this was the source of Wall Street's confidence to fight him to the death.

The put options purchased by Ernst Asset Management are all very short-term, with settlement within a week.

"As for shorting again, Goldman Sachs is well aware that it is impossible."

Goldman Sachs had anticipated this, which is why they were so confident.

Wenger also knew that this was the weakness of Ernst's plan: "If you really want to drag the American economy down with you, not to mention whether you can complete it, you will end up making enemies of the entire United States."

"Whether you're a Republican or a Democrat, those politicians entrenched in Washington will never tolerate you."

In the American political landscape, capital and politics have always been closely intertwined, and any behavior that threatens the stability of the national economy will be jointly suppressed by both parties.

Therefore, the killer moves Ernst has sent out so far are useful, but none of them are the kind that can kill instantly.

Wall Street giants firmly believe they will not go bankrupt. Even if they cannot withstand the seven-day stock price downturn, the Federal Reserve's bailout funds will definitely be available. This is their confidence.

"Goldman Sachs is forcing the Federal Reserve to make a statement." Ernst's lips curled up slightly, revealing a meaningful smile.

He was not frustrated by his current predicament; instead, his eyes shone with excitement.

In America, never go against the Federal Reserve.

This is an ironclad rule that all Wall Street professionals are well aware of.

Ernst naturally understood this principle, which is why he took the initiative to call Greenspan yesterday and expressed his willingness to take down the media reports first.

In its previous life, Lehman Brothers did not contribute a single penny in this bailout of Long-Term Capital Management, thus becoming a negative example.

The result is also very clear: during the 08 subprime mortgage crisis, the Federal Reserve only intervened to rescue the market after Lehman Brothers collapsed.

This time, Goldman Sachs took the lead.

It's no longer a question of whether or not to support the Federal Reserve; it's a question of going against the Federal Reserve.

I'm not going to follow the path you've laid out for me. Now I'm going to detonate this bomb and organize my brothers on Wall Street to force you to make a statement.

We urge the Federal Reserve to stand on the side of Wall Street and provide funds to rescue the market as soon as possible.

Although the results are the same, Goldman Sachs is overstepping its authority.

The Federal Reserve could have contained the crisis caused by the Russian debt default at minimal cost. However, if Ernst Asset Management continues to dump its holdings and Long-Term Capital Management experiences a chain reaction, the Federal Reserve will face immense pressure in its efforts to rescue the market.

"Yes, that doesn't align with capitalist thinking." Wenger frowned, a puzzled look on his face. "A fight to the death doesn't align with the principle of maximizing profits; it wouldn't benefit Goldman Sachs."

This is something Wenger has never been able to understand.

Although capitalists are greedy, they essentially prefer to make money through harmonious cooperation and win-win outcomes.

Especially for a young tycoon like Ernst, who holds a large amount of high-quality assets, his business empire is in a stage of rapid development and has unlimited potential for the future.

For Goldman Sachs, severing ties with such a promising business partner would undoubtedly be a huge loss.

As Ernst's business empire continued to expand and achieve greater success, Goldman Sachs never had a chance to get a share.

This is clearly inconsistent with the profit-seeking nature of capital.

The key issue is the Federal Reserve; Goldman Sachs' performance this time was a major setback.

For the Federal Reserve, Goldman Sachs is already out of control. If there is another Asian financial crisis, will they still ask Goldman Sachs to take the lead?

Is it worth doing this for a mainland telecommunications company?

"But what if I fall?" Ernst turned to look at Wenger.

Upon hearing this, Wenger's expression changed drastically, his body stiffened slightly, and his eyes were filled with shock and disbelief. "You mean the legal aspect?"

"How dare they? You're not some Tom, Dick, or Harry that they can just bully."

If Ernst were embroiled in various accusations, repeatedly investigated by the judicial authorities, or even fabricated charges against him, and ultimately sent to prison, that would be a different story.

At that time, the high-quality companies he owns will inevitably be forcibly auctioned off by the judicial authorities, which will become a feast for major financial institutions on Wall Street.

They can acquire assets that were originally priceless at extremely low prices.

Once you get to this point, it's no longer a question of legality or illegality.

Rather, it is an unspoken consensus among the top echelons of American society—that in the face of enormous interests, the law is often trampled upon.

"This is an open conspiracy." Wenger pondered for a moment, then finally realized, his tone carrying a hint of admiration and a touch of helplessness.

Goldman Sachs had considered all the possibilities, putting Ernst in a dilemma.

"If you continue to dump shares, you are going against all capital in the United States and becoming everyone's enemy."

"By then, what's the point of all this evidence? Won't the American judicial system have the final say?"

Just as Ernst predicted, he collapsed.

"And if you give up, it's tantamount to admitting defeat."

Ernst nodded, then gave a thoughtful look. "But you're right about one thing: Goldman Sachs doesn't have any reason to offend me like this. It's just a mainland telecom company; even if I fail, what can they do?"

He said with a hint of doubt, "The conflict between us hasn't reached the point where it's a matter of life and death."

Although there were disagreements and conflicts between him and Goldman Sachs, they also maintained a certain cooperative relationship. He really couldn't understand why Goldman Sachs would suddenly take such extreme measures.

"Paulson doesn't have the ability to represent Goldman Sachs and leverage the interests behind it to make such a desperate gamble."

Although Paulson, as the CEO of Goldman Sachs, wields considerable power, such a significant decision could not possibly be made by him alone.

"They are well aware that their current approach is a major turn-off for the Federal Reserve and could very well destroy the trust that Goldman Sachs has built with the Fed over the past century."

"This is the work of the top powers behind Goldman Sachs," Wenger agreed in a deep voice, but then he shook his head. "And the reason?"

What exactly is the reason? This is something Wenger can't figure out.

Just then, Ernst's cell phone rang.

"Massim's phone call," he said, glancing at it.

Ernst was already feeling a bit overwhelmed by this level of competition.

It's not about wealth or strategy, but about information asymmetry.

For example, Goldman Sachs could outmaneuver Ernst by taking every step into account.

Ernst wanted to retaliate, but he couldn't figure out who his enemy was or which faction within Goldman Sachs was behind it.

The influence of established conglomerates was demonstrated at this moment.

He pressed the answer button, and Massim's voice came through, lacking its usual frivolity and sounding somewhat heavy.

"It's been investigated and found out that it's a Jewish force, or more accurately, a Zionist group."

"Restore the Jewish state?" Ernst frowned deeply, his eyes filled with shock and confusion.

"Goldman Sachs, Citigroup, and all the forces involved in this matter are driven by the desire to restore the nation."

"Why?" This answer was completely unexpected. He couldn't understand why the other party would target him like this.

He does indeed have conflicts with this force; their influence was behind the initial dispute with Microsoft.

ICQ has now been sold to AOL, and although it is still barely surviving and has gone down the path of pornographic software, it shouldn't be this bad, right?

These actions by the other party were clearly intended to kill him.

"It can't be explained in just a few words." Massim's voice carried a hint of helplessness. "I'm already on the plane and will be there in three hours. Then I'll tell you everything I've found out in detail."

Ernst hung up the phone, his face still showing deep confusion.

The sudden intervention of the Fukugawa junta undoubtedly made the already complex situation even more unpredictable.