Chapter 116 Currency War 1
"Yes, money, military power and regime can be king only if they combine one. From this perspective, I really can't compare with him." Thinking of this, Laura's eyebrows trembled slightly, and she lowered her head obediently.
"It's time to stop your actions? Some people in your parliament have suggested easing relations with Japan, and your father seems to mean that," Laura asked cautiously.
"But when will it ease? One month or half a year? I don't care, can you?" At this point, Ruprecht glanced at his cousin. His cheap dad's attitude must have been revealed by his cousin! There are not many people in the Bavarian palace who know about this matter, and there are no ones who dare to interrupt casually. The only one who can get this news and dare to say it is his cousin, right?
"It depends on the need! The Japanese money can indeed bribe a group of people, but the decision of the Imperial Parliament cannot affect the Federal Parliament. The German Emperor's attitude does not matter, but the Bavarian Blue Legion can directly control the Far East process. The Qing Dynasty recently paid us a reward of 700,000 pounds, and the kingdom decided to send another regiment to maintain control of the Far East situation. Russia will also purchase more weapons, and these equipment will be shipped directly to the Far East. If these actions hinder you, then I can only say sorry." Ruprecht said with a smile!
"Before the war broke out, you could see that the outcome of this war still had a certain vision. Judging from the introduction of His Royal Highness the Princess, your warships in the past few years are quite compatible, with more means, but their capital is very limited. How much did you do in Japan's national debt?" Ruprecht asked.
"5 million marks." Laura hesitated for a moment and decided to honestly explain that she wanted to climb the big tree of Bavaria and obtain foreign aid. A princess without real power could not support her plan. Whether it was money or power, the help of power was far from enough, but the prince in front of her was different!
"Tsk, forget your bonds, let's play a more fun game! More principal and more exciting transactions! It's boring to get a cup of leftovers from Japanese people. It's interesting to steal their victory fruit into their own hands!" Ruprecht said.
Ruprecht hates the Japanese very much. Whether it is the reason for his previous life, the experience of being almost destroyed in the Battle of Toyoshima, or the invasion of the islands in the direction of the German Pacific during the World War in history, since the trip to the United States, Ruprecht has considered how to fight the Japanese again! Make some money! Japanese bonds can't catch up now, but there are other opportunities!
There have been options trading in this era. In fact, options are similar to gambling, and they are all about buying big and buying small. However, there is a very special thing about option trading, that is, buying and selling a certain right! With very little money, it can play a huge role with the help of a huge leverage effect!
For example, the current market price is 1 yen and 1 tael of silver. The current trend is the decline in the trend of silver. Everyone predicts that it may drop to 1 yen and exchange 2 taels of silver in the future. Then you can buy an option and agree that at some point, you are willing to buy a batch of silver at the price of 1 yen and 1.5 taels of silver. Maybe this silver will cost 1,000 yen, but in fact, you can get this right with 100 yen!
Well, after this option takes effect, depending on the market situation, if according to Volkswagen's prediction, the price ratio of yen to silver becomes 1 to 2 in the end, then you will naturally lose! You spend 1,500 taels of silver, and after you get to your hands, it is only worth 750 yen. If the delivery is formally done, you will lose 350 yen (the price difference of 250 yen and the cost of purchasing options of 100 yen). Of course, at this time, you generally choose to refuse delivery and give up this option, and your loss will be only 100 yen.
But what if the price of silver does not fall but rises? For example, if it becomes 1 yen to exchange 0.5 taels of silver, then you will make a fortune! After the option expires, you can buy 1,500 taels of silver with 1,000 yen! The market value of these silver is 3,000 yen! Then you are equivalent to making 1,900 yen! (Excluding the principal and the cost fee of 100 yen)
Of course, in addition to bullishness, there are also bearishness! You can make money by buying, and you can also make money by selling. The whole process is the opposite. The same example just now, the same setting, if everyone is bullish! If you think that you can only buy half a tael of silver in the future, then you are willing to sell at a price of 1.5 yen per tael of silver. If the price of the silver does not rise in the end, but falls, and becomes that 1 yen can sell 2 taels of silver. Then you buy 1,000 taels of silver at 1 yen and 1 tael of silver, and then buy an option of 1.5 yen per tael of silver. When the delivery date is reached, once the delivery is reached, then 1,000 taels of silver can be exchanged for 1,500 yen, instead of the current 500 yen!
Sometimes in order to prevent the risk of rising and falling wrong, people who play options will generally buy up and falling at the same time. This is the so-called hedging. In addition to this basic principle, there are some other amplification methods. Therefore, the financial market is a place where you can get rich overnight or lose poverty overnight. The competition is completely about means, information and capital! And this time Ruprecht intends to speculate on Japanese silver!
Why speculate on silver? It is very simple to be willing! The Qing Dynasty's compensation was silver! After silver arrived in Japan, it had to be converted into Japanese yen or other various currencies! However, according to the situation at that time, the currency and precious metals could be exchanged freely, and the price comparison to silver to the pound is still rising... From this we can imagine that if a large amount of silver poured into Japan as in history, the price of silver in Japan would definitely drop!
230 million taels of silver, if it is exchanged for pounds, it is 40 million pounds! 364.59 million yen! Japan's Sino-Japanese War of 1894 is about 230 million yen. Before the war, Japan reserved a large amount of war funds, but in fact it was only 78.95 million yen. This amount of money is only one-fifth of the total amount of compensation. And the money to be considered is withdrawn in three years, which will generate interest every year. In the end, after the Japanese deduct all the fees, they will still be left with about 300 million yen! These silvers will eventually be exchanged for yen and other currencies. The Japanese private and international silver markets will definitely fluctuate due to the inflow of these silver!
If nothing unexpected happens, the prices of futures and options markets will be bearish! After all, both yen and silver can be exchanged, and the Japanese government must convert silver into yen to use it. Japanese people will also consider selling silver as soon as possible to get the yen. But the prince decided to do the opposite! Aren’t you bearish silver? Brother insisted on giving you a bullish one!
Chapter completed!