In Tokyo, even the most fierce dragon is afraid of the hatchet

Nagano shook his head secretly: "Everything will be fine. If you really want to deal with it, I can help you think of a solution."

"Thank you so much, Nagano-kun!"

This kind of thing.

Regarding the status of Japanese life insurance.

It's really easy to solve.

I rushed to the company the next day.

Nao Nagano had a public welfare low-rent housing repurchase plan drafted.

To put it simply, the company will take over these houses, renovate them and rent them out to people who need to receive unemployment benefits.

But the small matter has been dealt with.

Suddenly, a piece of breaking news caused turmoil in the global financial markets.

this day.

1994 2 Month 14 Day.

The U.S. Federal Reserve raised its benchmark interest rate from 3% to 3.25%.

It was like an invisible sword of an emperor was lit up, and the Italian lira, which had been stable for a year, fell again. At the same time, the Finnish mark also experienced a sharp drop.

Japan, Tokyo.

The annual business community conference is held.

“In these three years.”

"The plan for a soft landing of the economy has initially achieved the expected results."

"But judging from the data from the Price Bureau, residents' consumption tends to be conservative, and there may be stagflation or even deflation in the long run."

"Now that the Federal Reserve has tentatively tested interest rate hikes, it is expected that a strong interest rate hike cycle will begin. Do you think this is a good opportunity?"

“…”

Finished saying this.

The cadres from various companies present began to whisper to each other.

The underwriting and sale of government bonds broke the Bank of Japan's ban on purchasing government bonds.

A large amount of funds flowed into the bond market, and not only did inflation stabilize, but prices also began to fall.

on the other hand.

Because of the collection of property taxes, real estate has fallen to a terrible level, so there has been a sharp drop in storefront housing prices, the tertiary industry has developed well, and inflation has stabilized within a very ideal expectation.

Moreover, prices are relatively lower than in previous years.

This cabinet has received good reviews.

But it would be a terrible thing for people to have no pressure. The time in Japan seems to have slowed down, and the fertility rate has only slowed down its downward trend, but there is no sign of improvement.

What’s worse is that deflation seems to have become part of daily life, and many department stores are frequently running advertisements to stimulate consumption.

But the consequence of the publicity is that many people try to take advantage of the situation without spending any money. They do nothing every day but queue up to get shopping coupons.

Send out eggs.

Being taken away.

But the things didn't sell.

The benefits provided to shareholders were taken away by others, and people were eating and drinking for free, but he didn't get angry at all.

Hearing the discussion among the officials present, Nagano Nao said: "This is clearly an act of exploiting loopholes. We can ask the Metropolitan Police Department to arrest them!"

"Nani?"

The company executives around couldn't believe what they heard.

He looked at Nagano Nao with shock on his face.

"Why are you looking at me like that? Isn't this a good suggestion?"

"Don't make such jokes, Nagano-kun. The law does not prohibit exploiting loopholes. It is the company's own commitment. Why are you arresting people based on that?"

"So what are you discussing? At a time like this, of course it is more appropriate to lower interest rates to stimulate the economy!" Nagano Nao immediately changed his attitude when he saw that the situation was not right.

No one knew that this guy had just switched his habitual thinking, and he excitedly said: "Yes! After three years of waiting, it's finally today! If the interest rate is lowered, we will definitely be able to gain more market share!"

"starting today."

"Asia will belong to our Yamato people!"

"..."

The day.

After some discussion.

The financial sector has confirmed the next overseas strategic expansion, while the central bank has begun to temporarily postpone government bond investment and lowered interest rates by 50 basis points.

As soon as the news came out.

The Japanese yen depreciated directly from 78.48 US dollars to 79.55.

The US dollar rose directly from 81 to 82.38.

There is nothing more disgusting than the United States raising interest rates and Japan lowering interest rates at the same time.

Because according to the yield ratio of emerging market countries, there is a gap of one times in interest rate returns.

For example.

The annual return on Thai baht deposited in the bank must reach 8% to match the 4% return on US dollars.

This yield ratio is determined by the security of the US dollar as the world's largest currency, so once the US dollar raises interest rates, global capital will flow into the United States.

As an import and export trading country based on manufacturing, Japan has automation capabilities and technological advantages that are unmatched by any other country in Asia.

The long-term appreciation of the Japanese yen in recent years has led to low profits and forced the abandonment of low-tech industries, which has given emerging market countries the opportunity to develop and allowed the four little tigers to rise with cheap labor.

But once the yen depreciates, it will become a competition between automation and cheap labor.

meeting dismiss.

Nao Nagano rushed to the Japanese Life Insurance Department as soon as possible.

With his current status.

In his eyes, he could already foresee the changes in the next ten years.

This is an era in which America is at its most powerful.

Emerging market countries have to deal with both the blood-sucking effect of the US dollar's interest rate hikes and the dimensionality reduction attack from Japan's automation and high-tech technologies.

The market is being gradually eroded, trade export share is being snatched away by Japan's cheap products, the trade surplus turns into a deficit, and foreign exchange earnings will also decline simultaneously, which is an inevitable result.

Iida Yoko is about to take up a position in the Ministry of Health, Labor and Welfare, and Minamoto no Mitsuei has reached retirement age. Although he still holds the title of president, he is gradually giving up his power.

Naoto Nagano, the peerless fierce dragon, naturally became the person with real power in the personnel changes.

This guy immediately convened a meeting and, as the vice president, issued the first order that actually represented the highest authority of Japan's life insurance.

"Omura-kun!"

"Next, if it goes as expected, Thailand will raise interest rates to combat capital outflows."

“And the Bank of Japan has decided to cut interest rates in response to the U.S. rate cut.”

“So, be prepared to start a carry trade between the yen and the Thai baht, and take a short position in the Thai stock market.”

Chapter 417: So this is how he died (End)

Hear this instruction.

Qingshan, who was present, wondered, "The Han Yuan also has a fixed exchange rate, with an interest rate of about 10%, and their foreign exchange reserves are also sufficient, and it's a fixed exchange rate, so it should be easier to make money!"

The so-called currency carry trade.

That is, foreign exchange carry trading.

It means borrowing low-interest currency and buying and holding high-efficiency currency to earn the interest rate difference.

Because currency is essentially a general symbol of equivalent, its value comes from the basic logic of supply and demand.

Because emerging market countries are all developing countries, their currency values ​​lack market recognition. In order to attract capital investment, interest rates are generally higher than those in developed countries.

So.

The interest rates in countries such as Thailand, Malaysia, Dahan, Indonesia, etc. have long been around 10% for deposit returns.

The yield on government bonds is as high as 12% or even around 15%.

In developed countries, the value of currency is stable and very low interest rates can attract capital, resulting in a huge interest rate gap.

If the interest rate spread is only two percent, it is not worth speculating.

But once it expands, buying the currencies of low-interest countries and investing in high-interest currency countries, whether it is depositing money or buying government bonds, will be a business with minimal risk but very profitable.

Because this type of purchase is equivalent to being backed by the country's sovereign credit, the profit from the arbitrage transaction is equivalent to being paid directly by the country's central bank.

So.

Carry trades tend to drive a flood of global liquidity and can also drive bull markets.

So seriously.

Qingshan’s suggestion is very good.

Arbitrage from fixed exchange rates has a stronger central bank backstop, lower risks and higher profits, and is an excellent investment opportunity.

But Nagano Nao leaned back on the sofa, lit a cigarette, and said as if he was looking at an idiot: "You idiot, are you questioning my decision?"

"That's not what I meant!" Qingshan looked aggrieved, but he could only respond. However, in his heart, he felt that the president was too domineering.

Nagano Nao had no interest in explaining. He rolled his eyes and said, "Don't look so aggrieved. You will soon understand why you can't take advantage of the exchange rate difference with the big man."

"..."