Dominate South Asia

Hong Kong’s currency is probably going to depreciate!

A few years ago, the Hong Kong dollar experienced a large-scale depreciation. At that time, the Hong Kong dollar adopted a floating exchange rate. As a result, when the future of Hong Kong was in crisis and Hong Kong people began to worry about the future of Hong Kong, many funds left Hong Kong. This led to the collapse of the Hong Kong dollar. Begins to depreciate. In 1981, the exchange rate was 5.13 Hong Kong dollars per US dollar, but in September 1983, it fell to a low of 9.60 Hong Kong dollars per US dollar.

At that time, people were panicked and everyone was worried about the future of Hong Kong. It was not until later that the government adopted a fixed exchange rate brake and exchanged HK$7.8 for 1 US dollar. Only then did the Hong Kong dollar stabilize again.

The issuance of any currency requires a deposit. For example, the earliest banknotes universally used in the world were probably those from the Genghis Khan period. The mighty Mongolian army conquered east and west, and banknotes began to be widely circulated. In Europe, Europe People are surprised to find that such a small banknote can replace the role of gold and silver.

At that time, this kind of paper money was directly exchangeable for gold and silver. The huge gold and silver reserves of Genghis Khan's regime could be exchanged for gold and silver at any time. Therefore, the paper money at that time was very stable, and all kinds of businessmen also liked to carry it. Paper money, after all, paper money is more convenient to use.

But later, after entering the Central Plains, Genghis Khan's regime began to become corrupt. When he was short of money, he began to print a large amount of banknotes. As a result, the banknotes continued to depreciate.

Any currency that wants to circulate must have reserves, and the issuance of Hong Kong dollars uses U.S. dollar cash as reserves.

Hong Kong’s foreign exchange reserves are only HK$700 billion, while Hong Kong dollar cash is more than HK$60 billion. Therefore, if cash is used to exchange U.S. dollars directly, Hong Kong's foreign exchange reserves are completely sufficient.

However, in addition to cash, there are more currencies in a broad sense, such as deposits, and the influx of various capitals during stock trading are all converted into Hong Kong dollars.

And when these currencies are withdrawn from the stock market. It was directly converted into U.S. dollars, which immediately created a gap in the foreign exchange reserves of major banks.

Many branches are short of foreign exchange reserves. Applying for transfer from the head office requires a process, and during this process, citizens got negative news that Hong Kong dollars cannot be exchanged with US dollars! The Hong Kong dollar is going to depreciate!

Everyone knows that there is no US dollar support. The Hong Kong dollar is a piece of waste paper, and now, it seems that this piece of waste paper will really become waste paper.

Hurry up and make your deposit. Convert to US dollars! The US dollar is an international currency, at least it is stronger than the Hong Kong dollar!

So, all the people started to go to the bank, hoping to exchange their deposits and cash into US dollars. In Hong Kong, this is completely legal.

result. The bank was crowded with people, and everyone was waiting anxiously. Thinking that their wealth had almost shrunk by half during the Hong Kong dollar crisis a few years ago, they were anxious.

At this time, the Hong Kong government finally realized that greater trouble was coming!

It turned out that the mysterious funds flowed into the Hong Kong dollar market. They haven't paid much attention to the exchange of US dollars in the Hong Kong dollar market. After all, although the amount of money is huge, it is only six or seven million US dollars. Converted into Hong Kong dollars, it’s only HK$50 million.

but. Now the situation has changed a lot. When all the uninformed citizens start to use Hong Kong dollars to exchange for U.S. dollars, the huge funds begin to be unable to circulate. There is strength in numbers, and all citizens in Hong Kong must start to exchange U.S. dollars. At that time, Hong Kong's foreign exchange reserves were simply not enough.

As a result, Hong Kong government officials appeared in major banks and in front of televisions, sworn to assure the public that the Hong Kong dollar was very strong and there were no problems. Everyone must believe that the Hong Kong government is fully capable of handling currency issues.

But if no one listens to them, can they believe what the government says? A few days ago, I just believed the words of that expert and continued to invest money in the stock market. As a result, I lost all my money!

The Hong Kong dollar issue this time must be related to the stock market crash! The stock market crash has caused everyone's wealth to shrink, and the Hong Kong dollar will also have problems!

Hong Kong citizens will no longer be confused by the government’s remarks. They are determined to wait in line at the bank and must exchange them for US dollars!

Now, the biggest headaches are those British directors of the Department of Finance and the Department of Finance.

"Someone is maliciously manipulating our Hong Kong dollars, which has caused us a crisis of confidence." The director of the Department of Finance said with an ugly face: "Now, all major banks are taking out their foreign exchange reserves and exchanging them with Hong Kong dollars. To calm the minds of citizens, but there will be more citizens requesting exchange, so our foreign exchange reserves will always be used up, and then we will be in even greater trouble. "

"I'm very surprised. What do these forces want to do?" said the Financial Secretary. "They maliciously manipulate the stock market and can cash out and make a profit. However, they manipulate our Hong Kong dollar and directly depreciate it. They have no choice. to any benefit.”

The previous Hong Kong dollar crisis was because the exchange rate of the Hong Kong dollar was floating. When the exchange rate was 10 Hong Kong dollars per US dollar, US dollars were exchanged for Hong Kong dollars. When the Hong Kong dollar stabilized to 7.8 Hong Kong dollars per US dollar, the exchange rate was then reversed to make a profit.

Now, the Hong Kong dollar has been confirmed to have a constant exchange rate. They used the Hong Kong dollar to exchange for the US dollar. Do they think the Hong Kong dollar will depreciate and then exchange it back? This tossing seems to have no effect.

The methods used by Soros and his ilk in later generations were not to make money in the Hong Kong dollar market. Their methods mainly consisted of three steps. First, speculators borrowed Hong Kong dollars at low interest rates as ammunition, and sold Hong Kong dollars in the futures market, while shorting futures. Then, opportunities favorable to speculators appeared in the external market, and they spread rumors and frantically sold Hong Kong dollars, forcing the Hong Kong government to "hold interest rates", causing the Hang Seng Index to plummet, and even borrowing stocks to short sell stocks. Finally, the harvest period came. When the Hang Seng Index plummeted, the short contracts were closed and the speculators left with the money.

They made profits mainly from the stock market and futures market. Attacking the Hong Kong dollar was just a means to use the Hong Kong dollar to cause turmoil in the stock market. Now that the stock market has plummeted and the other party has made money, it is time to leave. However, they did not leave, but instead came to disrupt the Hong Kong dollar market. This is simply a waste of time.

"That's right, their intention is even more sinister, they want to hit our Hong Kong economy! This is a challenge to our British government!" Sir David Wilson, the Governor of Hong Kong, had an angry expression on his face, and cursed countless times in his heart. He was the new Governor of Hong Kong who took office this year, and such a situation occurred within a few months of taking office.

Hong Kong citizens generally experienced a run on the bank, which is very unfavorable to Hong Kong's economy.

"We need to introduce interest rate hikes." The Financial Secretary said: "Use interest rate hikes to attract depositors to deposit their own currency in banks again, whether it is Hong Kong dollars or US dollars."

The main reason is the shortage of cash. As long as it enters the bank, these US dollars can be used for exchange again.

"Citizens are not confident enough now, and raising interest rates may not be able to stop citizens from exchanging US dollars." The Financial Secretary said: "Our foreign exchange deposits will soon be exchanged by citizens. If we want to survive this crisis, we must transport a batch of foreign exchange reserves from the country, so that we can calm this storm, otherwise, the prestige of our government will be gone."

Raising interest rates is not a good idea. Now, citizens have lost their trust in the Hong Kong dollar and started to run on the US dollar. This is different from stock speculation. After all, stock speculation is only a matter for stockholders, while running on the US dollar is the behavior of all Hong Kong people who hold Hong Kong dollars.

Now, even Macau, a region where Hong Kong dollars can be used directly as gambling funds, has begun to refuse to accept Hong Kong dollars. This is a very bad signal.

Only when new foreign exchange reserves are transported so that Hong Kong people can continue to exchange, when they find that they can freely exchange Hong Kong dollars with US dollars, will they regain their confidence in the Hong Kong dollar.

Otherwise, the consequences will be serious.

"Ship from London? That may bring certain dangers to our Great Britain's economy." The Governor said.

Last time, when the Hong Kong dollar crisis occurred, the British Empire used a lot of money to rescue it. As a result, although the Hong Kong dollar crisis was overcome, the British Empire also lost a lot.

This time, Great Britain was asked to use funds to rescue it. If there are more conspiracies behind it, the British economy might also be damaged.

However, watching the Hong Kong dollar collapse in Hong Kong without any domestic response measures would also show Britain's incompetence.

Therefore, this result is almost necessary.

"Report our problems to London." The Governor said helplessly.

After receiving the report from the Governor of Hong Kong, the London government was very concerned about the Hong Kong dollar issue. However, due to the outbreak of the Hong Kong dollar crisis last time, the British economy suffered great losses, so they were very cautious about the issue of rescuing the market.

This caution is a positive statement, and a negative statement is slow to react.

All foreign exchange funds in Hong Kong have been released, and the US dollar has been injected into banks so that citizens can exchange it with confidence. In front of every bank, there are long queues of people, and many of them even lined up here on the first night.

Seeing the people in front exchanged their money for US dollars, the people behind them felt relieved. If it is true that there is no problem with Hong Kong dollars as the government said, that would be the best. However, to be on the safe side, they should exchange their money first.

For some reason, the bank's work efficiency is very low. In this day, only more than 20 depositors were processed. The people behind can only continue to queue up and wait for the bank's business the next day.

The stock market has lost a lot of money. If the deposits lose again, then they will be devastated. (To be continued ~^~)