Rebirth of the Great Entertainment Empire

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February 1987.

The finance ministers and central bank governors of the United States, the United Kingdom, France, Germany, Japan, Canada, and Italy reached an agreement at the Louvre in Paris to take joint measures to strengthen close coordination and cooperation in domestic macroeconomic policies and foreign exchange market intervention, in order to Prevent the decline in the value of the US dollar and maintain the basic stability of the US dollar exchange rate.

After the Plaza Accord, although the U.S. dollar depreciated sharply against non-U.S. dollar currencies such as the Japanese Yen, because the U.S. government failed to take effective measures to improve its own financial situation, in the two years after the Plaza Accord, the U.S. foreign trade deficit not only It didn't shrink in the slightest, but continued to deteriorate.

Last year, the US trade deficit reached 168 billion US dollars, accounting for 3.6 percent of GDP, of which three-quarters of the deficit came from the current account surpluses of Japan and West Germany. The deterioration of the US trade balance and the sharp increase in foreign debts have affected the inflow of foreign capital to the US. The market's confidence in the US dollar has declined. The depreciation of the US dollar will do more harm than good. The trade friction between the US and Japan and West Germany has intensified again.

At the same time, affected by the appreciation of the yen and the mark, the foreign trade exports of Japan and West Germany declined, and the economic growth rate declined. Japan's economic growth rate dropped from 4.2 percent in 1985 to 3.1 percent in 1986, and West Germany's economic growth rate remained constant from 1985 to 1987. Hovering around 2 percent. Japan and West Germany expressed dissatisfaction with the failure of the United States to effectively reduce the fiscal deficit in accordance with the Plaza Accord.

In addition, the sharp and rapid depreciation of the US dollar has also caused major shocks in the international foreign exchange market and the world economy. The major developed industrialized countries obviously feel that they must stop the decline of the US dollar as soon as possible and keep the US dollar exchange rate basically stable, which is conducive to the common development of all countries in the world.

actually--

The United States can also choose to raise domestic interest rates to attract international capital inflows and slow down the excessive depreciation of the dollar. However, because of fears that this would cause a domestic economic depression, the United States was unwilling to raise domestic interest rates. Instead, it preferred Japan and West Germany to lower interest rates.

Under the leadership of the United States, in order to stabilize the international foreign exchange market, prevent the excessive and rapid decline of the dollar exchange rate, and solve the policy problems faced by developed countries through international coordination, the finance ministers and central bank governors of the G7 countries reached an agreement at the Louvre in Paris. It is agreed that the G7 countries should strengthen "close coordination and cooperation" in terms of domestic macro policies and foreign exchange market intervention, and maintain the basic stability of the US dollar exchange rate at the current level.

The agreement at this meeting is known as the "Louvre Agreement" in history.

One of the purposes of the signing of the Louvre Agreement is to curb the exchange rate growth between the yen and the mark and the dollar.

Honestly--

Judging from this purpose alone, the Louvre Agreement was clearly a failure—in the previous life, the yen rose until 1989 before it began to fall.

but--

It cannot be said that the Louvre Agreement has no effect on foreign exchange speculators—before the Louvre Agreement was signed, under the leadership of the G5, currency markets around the world were selling dollars. You don't have to worry about not being able to exchange for US dollars. Now, although it is also possible to exchange for US dollars, it is not realistic, or at least not easy, to exchange for US dollars in large quantities after the wave of selling US dollars is over. All in all, it is far more difficult to escape now than before the signing of the Louvre agreement.

but--

All of this has nothing to do with Xu Cun—because Xu Cun had already escaped completely before the Louvre agreement was signed. Now, except for the double necessary yen reserves, Xu Cun has already digested all the yen in his hands.

In this campaign, Xu Cun made a net profit of more than 33 billion U.S. dollars by repaying Xu Cun's loans from Citibank, Mitsubishi Bank, Mitsui Bank, and the Central Bank.

However, both eggs——

Xu Cun spent a total of more than 13 billion U.S. dollars to buy Standard Chartered Bank, and spent another 1.5 billion U.S. dollars to consolidate the equity of Standard Bank.

In addition, Xu Cun also invested 20 billion Hong Kong dollars (2.56 billion U.S. dollars) in the Shekou Industrial Zone, and spent 1.05 billion U.S. dollars to buy the entire Husky Energy.

These are nothing, but Xu Cun, a nouveau riche, spent 15 billion U.S. dollars to buy 1,200 tons of gold from the precious metal market. At present, among the 1,200 tons of gold, five One hundred tons are stored in the vault under the Baye Building, two hundred tons are stored in the hidden vault on Necker Island, two hundred tons are stored in the vault of Shi'ao Manor, and two hundred tons are stored in Beijing Baicunju. Among the vaults, one hundred tons are stored in a hidden vault on Musha Island.

You know, as the old note-issuing bank in Xiangjiang, HSBC and the original Standard Chartered Bank together only hold more than 100 tons of gold in Xiangjiang (Standard Chartered Bank only holds less than 30 tons).

Of course, it is not to say that HSBC and the original Standard Chartered Bank cannot reserve more gold, but rather than reserve a large amount of gold, they prefer to reserve foreign exchange:

First of all, as the world's largest gold import port-influenced by the Chinese preference for gold jewelry, since the 1980s, Xiangjiang has imported 100 to 200 to 300 tons of gold for consumption almost every year. Therefore, as long as you have money, it is very easy to buy and sell gold in Xiangjiang, and there is no need for HSBC and the original Standard Chartered Bank to deposit large amounts of gold.

Secondly, after the failure of gold speculation in the 1960s and 1970s, few private banks except the central banks of various countries have bought large quantities of gold for value preservation.

Again, with the development of the banking industry, gold trading is far less convenient than foreign exchange.

As for why Xu Cun wants to reserve such a large amount of gold, he has his own reasons:

First of all, Xu Cun burned a lot of money. He can't put all the more than 10 billion US dollars in the bank to sleep forever?

Secondly, the current price of gold is almost at its lowest point in history—the average price Xu Cun bought for gold was less than $320 per ounce.

Thirdly, Xu Cun, who holds the two major banks of Baye and Standard Chartered, has the thousand or two hundred tons of gold, and can freely transfer the deposits of the two major banks, Baye and Standard Chartered, and no longer has to worry about accounting problems. His property is mortgaged to his own bank - convenient.

Secondly, Xu Cun's purchase of these golds is also a layout, and he will have great use of these golds in the future.

All in all, after painstaking efforts, Baye Bank and Standard Chartered Bank have become Xu Cun's wealth engines - Xu Cun already has the ability to mobilize huge amounts of funds in a very short time.

Moreover, if Baye Bank and Standard Chartered Bank are fully merged and the resources of the two banks are integrated, the ability of Xu Cun's wealth engine to mobilize funds will definitely be stronger!

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