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As the global economy deteriorates and the U.S. dollar continues to depreciate, the U.S. stock market's downward momentum remains unstoppable. Although it seems that the daily decline is not large, just a few tenths of a percent, it cannot stop the daily decline.
Companies in the financial industry, in particular, almost all led the decline. The stock prices of several major commercial banks and financial investment companies in the United States cannot rise at all.
Although the U.S. government is agitating and major banking institutions in the world are injecting capital, they still cannot save the market.
The more chaotic the market is, the more extreme the methods adopted by financial investment companies will be. There is no way, I have already lost too much, and there is no way I can turn around without adopting some extreme investment methods.
Rather than being doomed to fail and lingering, it is better to take a gamble. If it succeeds, not only can it turn around successfully, but it can even make a lot of profits.
In the U.S. financial market at this time, high leverage mostly appeared from U.S. financial companies in order to attract more investment so that they could earn more profits and make up for their losses.
There are more and more junk bonds appearing on the market. Many bonds that were once worth as much as gold have now become pieces of waste paper. Xiaobu Shi is very worried about this.
In addition, those candidates are still attacking their D at this time, making the candidates sent by their D very embarrassed.
But Xiao Bushi has no time to pay attention to these things. What he wants most now is not to let the situation get worse before leaving office. It is best that the market collapses completely after the successor comes to power, so that the responsibility is not his.
If this happens, maybe the successor can be impeached, which would be the most beneficial to them. Anyway, in his opinion, even if the financial market of the United States collapses, other countries cannot surpass the United States. After all, this is the most mature and advanced financial market in the world, and the United States is the largest country in the world.
Moreover, the financial market in the United States has suffered a blow, and other financial markets are also inevitable. Whether it is European or Asian financial markets, they will be affected to some extent. Financial markets that are basically unaffected are particularly closed. And the particularly closed financial market is simply not prosperous enough.
"Mr. President, it seems we are in big trouble!" The Secretary of State came in to report.
"What happened?" Xiaobu Shi heard a lot of bad news every day, which made him very anxious.
"Two more financial companies have filed for bankruptcy protection, and another one has directly declared bankruptcy!"
Sure enough, it's bad news again. He has heard too much similar news in the past six months, can't there be some news that makes him happy
"Is it large-scale? Will it have a serious impact on other financial institutions?"
"The scale is not large, but it has a considerable impact on the industry. Among them, Lehman Brothers are the most serious. They lost US$2.8 billion in the first quarter, US$4.1 billion in the second quarter, and are expected to lose money in the third quarter. It’ll be over eight billion dollars!”
"There are rumors that Goldman Sachs is manipulating stock prices behind the scenes. The bankruptcy of Bear Stearns in the first quarter is also closely related to Goldman Sachs, but there is no concrete evidence. [△网WwW.]"
"Originally Barclays planned to acquire Lehman Brothers, but after verification, Lehman Brothers' cash reserves at this time were less than US$100 million, which is incredible for a financial institution of this size. But at this time Lehman Brothers' liabilities , has exceeded 500 billion US dollars, and is already insolvent!"
Xiaobu was shocked. How could the debt exceed 500 billion US dollars when it was not so serious in the past two months? This is the fourth largest investment bank in the United States, and it was once famous.
If the losses double and rise, will the liabilities also double and rise? The government has given so much emergency funds and given out so many loans, isn’t it all in vain
Xiao Bushi knows very well what insolvency means. All insolvent companies will eventually have no choice but to go bankrupt.
Lehman Brothers Bank suffered losses for the first time since it went public in 1994, and then collapsed. Obviously the company was still making profits in the fourth quarter of last year. Could it be that they had serious financial problems for a long time, but they just kept covering them up through financial means
But it shouldn’t be the case that the company can’t handle losses as soon as it starts to suffer losses. How could this company's ability to withstand stress be so poor
But maybe you can understand if you think about Bear Stearns, which went bankrupt two months ago.
Last year, Bear Stearns had a market value of nearly 20 billion U.S. dollars, and it was extremely prosperous. But two months ago, when Bear Stearns went bankrupt and sold it, it only sold for more than 200 million U.S. dollars, and its assets shrank by more than 95%. , the stock price has already fallen below the issue price.
Bear Stearns went bankrupt not only because they held a large amount of collateralized debt obligations, but also because with the advent of the financial crisis, a large number of investors concentrated their cash payments, causing their cash to suddenly become 0!
How can a financial institution continue to operate if its cash reserves are 0? So in March, the company's stock price fell from more than sixty dollars to less than three dollars in just a few days.
Of course Feng Yu is involved in this, but it is Goldman Sachs who takes the blame. Who made Feng Yu's investments the leverage provided by Goldman Sachs' financial companies
The U.S. government provided Bear Stearns with an emergency loan of US$30 billion. Even so, the company still failed to resist and was eventually acquired by JP Morgan for more than US$200 million.
This is not to say that the real value of this company is only this little, but don't forget that this company is also burdened with huge debts. Many financial institutions interested in the company were scared away by the huge debt.
During this period of time, financial institutions in the United States continued to go bankrupt. These Xiao Bushi thought about it, but they never expected that giants like Lei Man Brothers would also be on the verge of bankruptcy!
"Immediately contact the Bank of America and other institutions and ask them to contact the Leiman Brothers. The Leiman Brothers cannot go bankrupt. This will make the financial market situation worse!" Xiaobu said anxiously.
Since Barclays was once interested in Lehman Brothers, it means that Lehman Brothers still have many valuable assets. Besides, the Leiman brothers themselves have investments from many large investment companies, wouldn't they lend a hand at this time
"We have been contacted. Barclays has not completely given up its interest in acquiring Lehman Brothers. This time with the addition of Bank of America, it should be able to revive the company, right?"
With Xiaobu Shi full of expectations, in the afternoon of the same day, the lawyer representing Leiman Brothers submitted documents related to applying for bankruptcy protection.
Xiaobu Shi was completely confused. Didn't he agree that two major banks would negotiate for acquisition? Didn't he also make estimates for the financial situation in the third quarter? Why did he suddenly apply for bankruptcy protection? !
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