I'm back in 1990

Chapter 952: Limited Cooperation

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August 2008 marked the turning point in the US subprime mortgage crisis, which escalated from a severe financial turmoil into a global systemic financial crisis.

Prior to this, financial and securities investment practitioners and industry rule-makers still harbored the illusion that the crisis was controllable. However, they did not expect that in August, the crisis would evolve into the most severe financial and economic crisis since the Great Depression.

Zhang Sui and her team no longer engage in large-scale short selling using publicly available data as they did before.

However, in order to mislead potential competitors and relevant regulatory authorities, Zhang Sui arranged for his subordinates to continue shorting some financial stocks in small quantities, such as Lehman Brothers, AIG, and Washington Mutual.

In addition, we also shorted the S&P 500 and some financial sector indices.

Similarly, the scale is kept within a certain range, making it appear like a normal investment transaction to avoid being detected as unusual by those with ulterior motives.

Meanwhile, major funds mostly shifted to increasing their holdings of government bonds, gold, and buying large positions in safe-haven currencies.

At the same time, continue to close out the previously purchased CDS contracts and pocket the remaining early profits.

Zhang Sui looked down through the floor-to-ceiling windows at the bustling crowds on the street below. Not far away was the New York Stock Exchange building, the symbol of the engine of American finance, which had now become the starting point of the global financial crisis.

"Boss! The chairman of Wells Fargo has sent you another dinner invitation. This is the third time this week." Zhang Sui's secretary, Emilia, knocked on the door and entered the office, holding several exquisite invitations. This is a common feature of Wall Street, as bankers consider a formal invitation to be more formal than a phone invitation.

Zhang Sui turned around, looked at the invitation in her secretary's hand, and asked, "Who else?"

"A private dinner at Morgan Stanley, a working lunch invitation from the chairman of Citigroup, and several executives from Merrill Lynch's Treasury Department and the Federal Reserve also expressed their desire for an informal meeting with us through intermediaries."

"Understood." Zhang Sui's tone remained unchanged. Today, she wore a tailor-made black suit, made by the best tailor in Europe. The suit perfectly accentuated Zhang Sui's slender figure.

She then instructed her secretary: "Proceed with the previous plan. Politely refuse some of them, and only accept those that cannot be refused. The wording of the refusal must be tactful. Just tell them that I am busy with the restructuring of several key assets and time is of the essence."

Emilia nodded and noted down her boss's instructions one by one. Then she said, "Mr. Fuld from Lehman Brothers would like to speak with you. They want to discuss some issues with you."

Zhang Sui refused without hesitation: "No, but you can tell him that we will contact them at the appropriate time."

After Emilia left, Zhang Sui sat back down in her chair. Several LCD monitors were neatly arranged on her large desk, displaying real-time updates from major global markets.

On one of the screens, the S&P 500 index continued to fall, and the financial sector was in a dire state due to the subprime crisis.

However, Zhang Sui and her team's net profit rose against the trend, shorting financial stocks and buying government bonds and gold, creating amazing returns in this dark month when others were lamenting their losses.

She picked up the satellite-encrypted phone and made a call to her boss, who was thousands of miles away.

The call was answered quickly.

"What is it?" A steady and calm voice came through the microphone to Zhang Sui's ears.

Zhang Sui involuntarily sat up straight: "Mr. Huang, I receive so many invitations every day, it's like everyone wants to know me!"

Huang Xiaochuan chuckled softly: "That's normal. When everyone else is losing money, but you're making money, you naturally become the center of attention."

Zhang Sui also laughed: "I know, they approached me simply to find out my next move, or to pull me into their camp. Their goal is to get a share of the pie."

Then Zhang Sui changed the subject: "Actually, I had already followed your instructions and distributed the profits to the major players, but they are still so greedy."

"Don't worry about that. Greed is the norm in the financial world. What we need now are friends and allies. You should know that the authorities and the Federal Reserve will definitely intervene, so it's better to have more friends than more enemies. Paulson and Bonanko won't sit idly by and watch the entire financial system collapse. I suspect a massive bailout plan is already in the works." Although Huang Xiaochuan spoke casually, his words sent a shiver down Zhang Sui's spine.

But she knew there was more to come. Sure enough, Huang Xiaochuan on the other end of the phone instructed her again: "So you have to participate selectively. When the authorities start to buy up those toxic assets, we have to cooperate. Doing so will not only allow us to make profits, but also show that we are cooperating with the authorities to save the market."

After hanging up the phone, Zhang Sui pondered for a while, then contacted her secretary: "Amelia, tell the middleman that I've accepted the informal invitation from the Ministry of Finance. You coordinate the timing with them."

"Okay, boss."

Three days later, Zhang Sui appeared at a private club on Fifth Avenue. It was a small dinner hosted by JPMorgan Chase CEO Jamie Dimon, with only a dozen or so invited guests, but it included some of the most influential people on Wall Street.

"Zhang! It's a pleasure to meet you!" Damon greeted him personally at the door, the banker, known for his shrewdness, appearing unusually enthusiastic tonight.

"Thank you!" Zhang Sui responded with a smile, her attitude calm, maintaining a just-right distance between them, which is also a matter of etiquette in social situations.

The atmosphere at tonight's banquet was very harmonious, but beneath this harmonious atmosphere lay the hidden thoughts of each person. Everyone present knew that Zhang Sui and her team had been able to reap such great rewards in this crisis because they must have foreseen the direction in which the situation would develop.

That's impressive. In the financial securities market, making money is a common thing, but being able to make accurate predictions is a remarkable ability, which is why Zhang Sui is so popular.

Everyone immediately turned their attention to Zhang Sui.

Zhang Sui smiled slightly, took a glass of wine from the waiter's tray, and said, "Mr. Sain, you flatter me. We just did some in-depth fundamental analysis and took a bold bet because we believe that there is no such thing as a market that rises forever. We still have more faith in the data. The default rate of subprime mortgages, the price-to-income ratio, and household debt statements are all public data. We believe that numbers do not lie."

Zhang Sui calmly surveyed everyone present and retorted without batting an eye, "Mr. Fuld, everyone on Wall Street has premeditations. The difference lies only in that some people's premeditations are based on rational analysis, while others are based on blind optimism. Forgive my bluntness, but when Lehman Brothers packaged subprime-related assets into AAA-rated bonds for sale, wasn't that also a form of premeditation?"