My Age of Investment

   Chapter 929 Where can't you go! What can't be done!

night.

After a fight, Xia Jingxing and Christina lay on the bed sweating profusely, naked and facing each other. The former's hands were still rubbing the smooth skin of the latter, crossing the hills, climbing the mountains, and walking. grassland……

  Kristina "chuckled" and twisted her body.

   "What happened to you today? It feels like you took a stimulant?"

  Xia Jingxing pretended to be angry, and twisted the screws of the two shiny car lights with his hands, "Taking medicine? I need to take medicine? I want to take your two medicines too!"

  Kristina patted Xia Jingxing’s evil hands while reaching for a tissue, ready to wipe the baby’s rations.

   "Forget it, don't waste it!"

  Xia Jingxing buried her head and helped Christina clean up the dirty juice on her body.

   "嘤咛～"

  Hearing this sound, Xia Jingxing knew that the car was still not repaired and the oil might not be full, so she continued to repair the car.

  Half an hour later, Christina began to beg for mercy, saying that the car was about to be repaired and Xia Jingxing stopped repairing the car.

  Kristina lay on her back on the bed, panting hard, she didn't even have the strength to lift her fingers.

   "Get up, hey, isn't it good at ordinary times?" Xia Jingxing smiled and looked at Christina, who was motionless.

   "Not coming, I surrender!"

   Hearing this, Xia Jingxing just let Christina go, feeling that Qiu Ge's medicated diet is really tonic. It is said that it is the secret recipe of the palace. It seems that we will collect more of these ancient recipes in the future to protect the cultural heritage.

   Rested for a while, Christina regained a bit of strength and asked: "Are you going to be away for a while?"

"how do you know?"

  Kristina gave him a blank look. If it weren’t for retreating, how could she not hesitate with bullets and fought her four battles tonight.

   Seeing this, Xia Jingxing did not conceal it. He talked in detail about the short-selling of subprime loans by Vision Capital. Because it was too important, he needed to go to New York to take command.

  After listening, Christina opened her mouth slightly, "You made billions of dollars in profit from shorting subprime mortgages? Is it achieved by shorting CDO?"

  "Do you still know CDO?"

Christina said unconvincedly: "I am also the CEO of Facebook anyway, so I naturally have to pay more attention to financial news. I heard financial experts say that CDO, a financial derivative, is quite dangerous and may cause unpredictable serious financial risks. .

  At present, housing prices are declining, and the default rate of subprime loans continues to hit new highs. Therefore, the prices of financial derivatives such as CDO and CDS, which are innovative on the basis of subprime loans, have also experienced serious fluctuations.

  The financial institutions that participated in such financial derivatives transactions all suffered big losses, some of their profits fell sharply, and some issued loss forecasts...

  The financial industry must be sad this year, and basically all have lost money. "

  Xia Jingxing smiled without saying a word. Christina’s views represent the views of most people at this time, that this financial risk is limited to the financial industry and will not spread to other industries, evolving into a global financial crisis.

  To be honest, this view is also normal. After all, financial companies are all complaining now. One is counted as one, and all of them have participated in subprime derivatives investment.

  Investment, it is normal to have losses and profits!

  Most ordinary people in the U.S. and people in other countries around the world feel that they have little to do with them. They are in a good class and will not suffer wage cuts and layoffs.

Seeing the joking in Xia Jingxing’s smile, Christina gave him a fist, “I’m not a financial student. You taught me even securities investment. Later, although I learned venture capital and equity investment by myself, But financial derivatives trading is still too complicated. I don't understand it, it's normal.

  Are you knowledgeable? Tell me quickly, how did you do it? "

Yang Niu was very interested in this. Before, she only knew that Xia Jingxing pledged Facebook shares to invest in the financial market. Later, because of her father’s affairs, she further learned that she was shorting subprime mortgages, but she didn’t know how to do it. I understand, I haven't asked Xia Jingxing.

  She generally doesn't bother too much about her boyfriend's career, except for Facebook, in other industries.

Xia Jingxing briefly introduced Christina, and then said: "I will give you a few more sets of data. The GDP of the United States last year was 13.8 trillion US dollars, and the balance of housing mortgage loans was 9.8 trillion US dollars, of which subprime loans accounted for 20. %, probably the figure is close to 2 trillion U.S. dollars.

  From 2004 to this year, a total of more than $1.4 trillion of CDOs were issued. "

  "Is there any problem with this?" Christina didn't think it was too ridiculous. After all, in a country as big as the United States, with various assets of several trillions and trillions, it couldn't be more normal.

  Xia Jingxing smiled: “Of course there is no problem. CDS is not a big problem. The market size is only 62 trillion US dollars, which is more than four times the US GDP.”

  Kristina stopped speaking. Through Xia Jingxing’s introduction, she knew that CDS was actually a contract similar to an insurance policy.

  The insurance policy will naturally charge premiums, but the premiums are carefully investigated and designed to estimate the renewal rate/risk rate of 1%-2%.

  Once there is a deviation in the estimate, the default rate does not need to be too high. It only needs 10% to form a hole of trillions of dollars, which is equivalent to half of the US GDP.

too frightening!

  Kristina said with emotion, will it reach or exceed the 10% default rate?

  She suddenly remembered a report in the news that because of the falling housing prices, the residual value of the house became negative, and the mortgage that needed to be repaid exceeded the market value of the house.

  In this case, someone began to give up the house, no longer repay the loan, and let the house be taken away by the lending agency.

  There is no right of recourse for mortgages in the United States, so banks have to bear the losses of these non-performing loans.

  Oh, that’s wrong. The mortgage has actually been packaged as CDOs by major banks and lending institutions and sold to global investors. In fact, banks do not have to bear any losses, but may make some asset price differences.

  However, Bank of America is not so honest. Many banks see CDOs that seem to be quite profitable, so let's start a little bit.

  Just talk about the mortgage default rate. As long as the house price does not rise, it is impossible to fall, and it will only become higher and higher.

  Kristina stopped thinking about the extent of the impact of the financial crisis, and began to care about Xia Jingxing’s fund safety. She asked: “With such a big financial risk, will your investment be risky?”

   "There were risks originally, but as the financial risk exposure caused by subprime mortgages became larger and larger, my investment risk became smaller and smaller."

  Xia Jingxing chuckled, “Unless the White House now intervenes in housing prices and supports the housing market, it will not lose money, but will only make money, and profits will become snowballs, becoming bigger and bigger.”

  Kristina took a breath, "hasn't I already made billions of dollars? Will it stop?"

  Xia Jingxing smiled and said, “This is nowhere. The CDS contracts we hold add up to tens of billions of dollars, enough for those greedy guys to drink a pot.”

"If all the money is made, wouldn't I be able to buy Facebook?" Kristina felt that the financial market was making money too quickly. I thought that Facebook's valuation growth was already a miracle. Unexpectedly, it is still inferior to the speed of making money in the financial market.

  Xia Jingxing smiled, and did not answer. Facebook is nothing, and valuation cannot be used as food or money, but the money in the financial market is real.

  With this profit, the world is so big, nowhere to go! What can't be done!

  (End of this chapter)