Chapter 2249: Sky God Chen Mo
House prices in Baguo have increased by nearly 200% since 2000, and finally started to fall in the past two days.
Most of the subprime mortgage users took out horrible "balloon loans".
Coupled with the news about Chen Mo's "Emperor's Community", "Professional Debtor" and the video evidence found by Trevor, the panic was intensified.
Countless people began to sell their properties to stop losses, or cut off their property supply and ran away.
Chen Mo's short selling of the stock prices of Bells and others was not actually a fatal blow, but the straw that broke the camel's back.
Unlike ordinary commercial banks, Bells and others do not have the ability to absorb deposits. The housing loans they issue are obtained from financing and selling subprime mortgage bonds.
Now, subprime mortgages cannot be issued and CDOs cannot be sold. Companies such as Bells have no income and have to pay off debts. The capital chain was broken overnight.
It is a very, very scary thing to have the capital chain cut off.
Many large companies with a market value of hundreds of billions are likely to go bankrupt because they cannot raise billions in cash flow, causing their capital chain to break.
At this time, Jims had no ability to care about the stock price.
He personally went to Mogen Chase and found its CEO Jimmy Dimon to borrow money.
"Jimmy, you must help me this time. If you don't help me, we will probably go bankrupt!"
"Brother, I am willing to help you, but you are borrowing money too quickly. With such a large amount of money, it is not safe for you to ask me to make such a major financial commitment in a hurry with just a few hours of research.
Well, let me help you seek help from the Federal Reserve Board of Governors, which can provide emergency loans. "
Jims reluctantly agreed, because he knew Jimmy was telling the truth.
For such a large loan, according to normal procedures, Mogen Chase will need to conduct asset evaluation, risk assessment and other processes for several weeks or even months.
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Jimmy Dimon was quite loyal and drove James to the Federal Reserve Bank of China.
To be honest, Jimmy really hopes to get this loan.
If Bells and other companies went bankrupt and triggered the subprime mortgage crisis, then none of these financial institutions would be able to escape, they would all be involved!
The Fed seemed to have expected Jims to come back for help.
Because just now, the stock prices of Bells and other companies fell 36% in just half a day after being shorted by Chen Mo.
The most frightening thing is that the decline in the stock prices of companies such as Bells has caused a comprehensive collapse of the real estate sector.
The ABX index fell 5 points in response!
The ABX index, which had never fallen from 2000 to 2008, was finally suppressed by a white dragon from Daxia today and was unable to lift its head!
For the first time, the market felt the chill from subprime mortgages.
The people at the Federal Reserve calculated that Chen Mo currently holds close to 3 trillion CDS, and the ABX index fell by 5 points, allowing him to make a profit of 150 billion in one day!
Chen Mo's performance in one morning was several times greater than Soros' short selling of the Sunset Empire currency back then! ! !
The news sent shockwaves through Wall Street.
CDS, which no one paid much attention to in the past and was even ridiculed for buying, has begun to be crazily pursued by Wall Street elites and investors.
The telephone numbers of all the major CDS selling institutions have been flooded with calls.
Everyone is asking how CDS works.
There is a wave of using CDS to short subprime mortgages in the market.
If this wave cannot be stopped, the ABX index will fall further, further promoting the outbreak of the subprime mortgage crisis.
Although the official of the hegemonic country has repeatedly condemned the purchase of CDS, saying that buying CDS will cause extreme deterioration of the hegemonic country's economy, and in the end, everyone will not have an easy life.
But... no one listened!
Today, the wave of short selling real estate has been successfully gathered by Chen Mo. Investors all over the world are like sharks smelling blood. They have gone crazy and are terrifyingly greedy!
People who dominate the Federal Reserve have also seen that many people believe that giving Chen Mo the name "Big Short" can no longer describe his crazy short selling behavior this time.
Netizens gave Chen Mo a new nickname - "Sky God"!
And those who are shorting subprime mortgages and shorting Hegemonic real estate all claim that they have joined the "empty god camp"!
They called the moment when Chen Mo shorted the stock price of Bells and others the "Bells and others moment", and they all recognized this moment as "the beginning of the subprime mortgage crisis."
“In the beginning, Chen Mo wanted to short Baguo Real Estate, and the whole world laughed at him.
But now...hey...did he really do it? "
Gass, the top executive of the Federal Reserve Bank, murmured with emotion and shock.
At this time, Jimmy found him with Jims and began several hours of intense negotiations.
"Our company may face a cash crisis this time. We only have three to four billion in cash on hand. If we have no choice, we have no choice but to apply."
By "filing," Jims means filing for bankruptcy protection.
This isn't a threat, it's just telling the truth.
Gass was silent for a while and asked: "The most critical question now is not how much liquidity you still have on hand, but whether you can borrow
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I’ll give you the money to see how long it can last in the current market conditions that are on the verge of collapse. "
His guess is: it won't last long.
Jims knew it well, but he could only bite the bullet and say: "I don't think house prices will continue to fall. As long as we can hold on for this period of time, the situation will definitely get better."
Gass wanted to make a sarcastic remark, but after thinking for a while, he only said: "Wait for me to report to my superiors. I can't make a decision immediately."
Gass himself was extremely reluctant to lend money to companies such as Bears, because he knew that this was likely to be a bottomless pit.
But the person who can really make the decision at the Fed is not even the head of the Fed, but the foundation!
Gass quickly passed the news to Solomon.
"Mr. Rothschild, Bears is the fifth largest investment bank in the country. If it goes bankrupt, I am worried that the market will cause a chain reaction.
But if I lend money to it, I am afraid that I will be throwing meat buns at dogs.
So, you have to make the decision on this matter."
Solomon took a deep breath: "Once Bears and other companies go bankrupt, the chain reaction will be terrible."
In fact, Solomon himself didn't want to pay this money.
But he couldn't not pay it! ! !
"You go and make a safe plan, and be sure to think it through."
"Okay."
After Gus left, Solomon smashed the water cup on the table.
"Okay, okay! Chen Mo, you've started, right?!!"
"Then I'll let you know the true terrifying power of the Foundation!!!"
"Michelle, pass the order down, starting tomorrow, buy the ABX index for him, we're going to beat Chen Mo on the ABX index!!!"