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Chapter 338: Chapter 332: This is Pure Madness – Below
However, they never could have imagined that this old -fashioned foundation would be so terrifying! They had achieved control over so many funds! The accounts they had previously controlled were only a small fraction of the accounts the foundation held, a mere drop in the bucket.
And now… these funds were on the move. Finn Lewis had a pretty good idea of what Zero had done. But in his heart, he was slightly shaking his head. Honestly, Finn had wondered if the money he had spent on missions might arouse suspicion. But back then, his thinking wasn’t matured enough. He always thought that since the government didn’t check, they probably wouldn’t find anything.
But now, whether they checked or not doesn’t matter. All he could say was…
Zero was badass. He had given an immaculate explanation for the origin of Finn’s assets. The most important part was, an explanation alone wouldn’t have sufficed. They had cold hard evidence. Now, Finn could simply bluff, claim that he was the operator of this foundation, and no further explanation would be needed.
Damn, if owning 4.8% of the Fruit shares had provided an explanation for the initial source of Finn’s funds, then this identity had given an acceptable explanation for the source of the money he’d spent on missions.
However, Finn was just starting to understand this himself. But for those at the Red Flower Bank, the Rhine Kingdom Bank, and the people at the bank who couldn’t sleep at night, this was simply petrifying. What had the trillions of Federal coins pouring into the LD market done? First, they had entered the gold futures market and began shorting gold in mass. Under a 1:20 financial leverage, they dumped several million short orders in an instant.
Such provocative short-selling caused the previously rising international gold price to slump on cue. Although the daily transaction amount in the LD gold trading market also numbered in the tens of trillions of Federal coins, that was all it was, tens of trillions of Federal coins. Perhaps a few tens of billions of Federal coins’ order couldn’t interfere too much.
After all, even if you used a 1:100 leverage, you could only stir up a few hundred billion Federal coins, but if you used such high leverage, it means that your collateral would be very weak. At that time, if a few big fish decided to dump a few long orders on you, your collateral would be immediately insufficient, and then you would be directly closed out. That would lead to total loss. But what about now? Who dares to pick up these shorts?! Millions of short orders were dumped, causing gold prices to plummet drastically, instantly dropping by over thirty percent. But the most important thing was, everyone significant in the futures market, like the FlowerRed Investment Bank, Rhine Kingdom Investment Bank and other bankers’ investment companies, knew how much capital the person placing the long orders had.
With trillions of Federal coins in collateral and 1:20 leverage, it equates to a total of 20 trillion Federal coins. You would need to initiate more than 20
trillion Federal coins worth of long orders to pick up the pan. But can these investment banks mobilize so much capital?
They can’t! Because for them, most of the money they have is from depositors. If they fail to pick it up, it would cause a significant issue. Furthermore, even if they wanted to, they don’t have the funds! The total asset of the world’s largest bank is 13 trillion Flame Nation coins, equal to just over 2 trillion Federal coins! This is a total asset; it doesn’t mean they could mobilize that much capital.
These informed market makers knew that they couldn’t handle it. What would they do? The result is obvious. They also traded futures in the gold market. So, Imowing they couldn’t compete, to protect their own investments, these major market makers instantly hedged their positions and quickly shorted.
As a result, the entire gold futures market began a terrifying plummet almost in the blink of an eye. When the price of gold dropped to about seventy-six percent less than before, the terrifying, undealed short orders started to be withdrawn, and the price of gold immediately maintained at a very low level, arguably the lowest in history!
Although everyone knew that the price of gold couldn’t be so low, they were powerless! Because this is the futures market. Unless you have stronger financial power than the other, capable of driving up the price of gold, otherwise, if you dare to take a long order, you will be directly ruptured by the massive short orders, forced to close and settle, leading to a total loss.
This is why the futures market is much more terrifying than the stock market. When the price of gold hit this level, countless people worldwide began to feel their hearts couldn’t take it. Because at this price, at least nearly 170 billion Federal coins’ worth of gold long orders were at the point of being forcibly closed.
At this moment, even if only a few more tens of billions of Federal coins’ worth of short orders appeared, these 170 billion Federal coins’ worth of long orders would be instantly forcibly closed. By then, based on the price when they placed the orders, the loss would be around 100 billion Federal coins! For these futures companies, it means a total loss!
And their loss of these 100 billion Federal coins would directly become Finn’s profit. After Olivia Thatcher explained all these, Finn was speechless. Damn, no wonder they say that playing in the futures market causes heart attacks. Wow, an instant loss of hundreds to thousands of billions of Federal coins. Holy crap, without a strong heart, you’d probably have a heart attack.
The apocalyptic influx of money was horrifying. However, it was a shame that Finn didn’t understand all this, and even if he did earn this money, it wouldn’t be his. But now, instead of letting this 170 billion Federal coins’ worth of gold directly blow up, Olivia Thatcher would immediately go long herself to maintain this 170 billion Federal coins’ worth of long orders every time a new short order appeared, taking all these short orders.
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This is the benefit of having a lot of money, go long if you want to go long, go short if you want to go short. Now, in the entire gold futures market, Finn calls the shots.
‘Why do we need to maintain a long order of 170 billion Federal coins?” Finn asked curiously.
“Because among these 170 billion Federal coins’ worth of long orders, there were about 20 billion Federal coins’ worth of long orders invested by nasperslimited company. If they are closed, they will lose more than 16 billion Federal coins in cash.” Olivia Thatcher responded succinctly. Finn suddenly realized!
No wonder, actually it couldn’t be blamed on nasperslimited company being the last to realize. You should know that this 170 billion Federal coins’ worth of long orders, not only them, but even the investment companies under the bank had about 12 billion Federal coins’ worth of trapped long orders. The banks, however, weren’t too afraid. After all, they had enough collateral, high risk resistance, they could hold on until the futures directly conducted physical delivery.
After all, they are banks, and there’s no fear of losing money with 120 billion Federal coins’ worth of gold back. And moreover, in the case of such strong short-selling, it was clear that it wouldn’t last too long..
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