Thousands of sparks

Chapter 167 Economic War
The Royal Bank of Newsail was fully taken over by the newly formed Department of Financial Management of the Home Affairs Committee the day after Finn and Jeanne left.

At the same time, the other [-] small and medium-sized banks in Newsail were also included in the comprehensive supervision of the Office of Financial Management.The old accountants entered the bank gate under the protection of the Newsale National Army and Aika agents, and then began to seal all the books, which caused a huge shock to the entire Newsale financial system.

The shock is mainly manifested in the danger to everyone in the Newmarket financial system.On the night when the audit team arrived, Al received more than 30 reports.These small and medium-sized banks all knew that their "peers" were not very clean, so they unanimously chose to report the other party to spread their firepower.

The so-called dead friends don't die poor, as long as they have more time to react, at least they have a chance to think of a way.

The way they think is relatively simple. The first reaction of these small and medium-sized banks who reported their peers was to revise their account books.The audit team did not get all the books, so it is actually very simple to balance the accounts - as long as there is enough cash, and it is enough to match the revised books that the audit team does not have.

But it takes time.Whether it's raising funds or revising the books, it takes a while to complete.As a result, small and medium-sized banks began to report desperately, and at the same time, the fundraising operation was also proceeding at full speed.

In addition to raising funds, surprise lending is also a very important "risk control means."The biggest problem for these small and medium-sized banks is that the book funds and actual funds do not match.But that doesn't stop them from cutting out the "differences" in it.

If the book funds are insufficient, then urgently find a company with a better relationship to put a sum of money out.In this way, the book funds can be quickly reduced, and the "loan claims" of these well-connected companies can be used to mortgage other banks, and another sum of money can be drawn into the account for inspection.

In short, they take time.

And Dusande didn't intend to give them a chance to struggle at all. Even he, a layman, knew how big the risk was.As long as the money cannot be recovered at all, the entire chain of mortgage lending routines will be violently defaulted.He allowed those audit teams to settle in small and medium-sized banks in order to defuse risks.If this group of smart people come up with a bigger set of mines in order to avoid the possible punishment of resolving the risk... wouldn't it be picking sesame seeds and throwing watermelons?

As a result, Aika's agents had no choice but to work overtime.They detained all the high-level bank executives who came to report, and then went out and caught the whistleblowers.

In short, the next morning, fifteen small and medium-sized banks in Upper Albyn were surprised to find that their chief accountants and presidents had all been arrested-according to the explanation given by Aika, these people were "dangerous to the society of New Saul". Safety".

The task of local risk mitigation is very arduous, and Dusand himself can hardly give any specific instructions for this risk mitigation action.He can only hope that Escobar and the group of old accountants he recruited can find a solution.

However, this did not affect Dusande's eyes on Olin.

Since the Newsale financial system has so many Rays, why doesn't Olin have one?It can be seen from the fact that the financial minister will send his own servants to collect the interest instead of trying to calm the risk-as long as he can make money, the financial minister acts recklessly based on his identity as the emperor's grandfather , he doesn't care about the risk.

Of course, if you only look at what the great minds of Newsale's financial system have done, it may be that the empire has no idea of ​​how much impact the risks of the financial system can bring.

Since you don't guard against thieves, then if I don't invite some thieves to visit your house, wouldn't I be very sorry for your enchanting posture?

Dusande decided to start an economic war against Olin.

To launch an economic war against the entire empire requires a very strong economic strength.Dussande didn't even bother to ask Escobar "Can we do it?" The answer to that question was definitely "impossible."

The purpose of economic warfare is to cause heavy damage to the enemy through economic means, and the purpose is to weaken the enemy's war potential and plunge the enemy into "civil strife" through financial and economic means.It is a specific method of warfare under the guidance of the "total warfare" ideology, and the effect is often not bad.

You can get the same effect as shells smashing into the enemy's main city without firing. This method of combat can definitely be regarded as efficient and low-cost.The only problem now is that no one knows how to turn the idea into reality.

Even Dusand himself has only a vague concept of "economic warfare".The level of "economic warfare" he has seen in online novels often stays at the level of "manufacturing counterfeit currency" to disrupt the enemy's economic operations.A more sophisticated method... He has never heard of it anyway.

But the goal is very simple, as long as it can bring enough trouble to Olin.

Although Dusand is very convinced that even if it is just Olin, its economic scale is thousands or even tens of thousands of times larger than the counterfeit coins that Newsaar can produce.Using counterfeit coins as a means, I am afraid that Newsale will not have too much impact on Olin if he tries his best.

If you want to do something, you have to make it bigger.Just buying some strategic materials with counterfeit money is really meaningless.

With this in mind, Dusand found Escobar and told him about his thoughts.

"My goal is simple. The more damage to Olin's economy, the better." Dusande put his hands on the table and leaned forward, staring into the eyes of Escobar, who has lost weight recently. , "Why are we the only ones busy in resolving systemic financial risks? Olin's development history is much longer than ours, and they must have many accumulated risks that can be exploited by us."

"Then you shouldn't just focus on banks or other financial products." After thinking for a while, Escobar made his own suggestion, "If you want to do it, then make it bigger. I suggest that you first pass the Central Teco, start a glove bank in Olin, and pick some of the good stuff these bankers in Newsale have done. Build yourself up first, then figure out how to make the bomb go off."

A conspiracy gradually took shape in the "chitchat" between Dusand and Escobar. The two top leaders of Nusaal seemed to be complaining to each other about some bad things they had encountered recently. Lin's "Olin Development Bank" has administered one dose after another.

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After receiving the instructions from Dusand, Lorraine was distressed for a while, and then the more she read the instructions, the happier she became. laughed.

"What's the matter?" Schultz raised his head and looked at the actual controller of Central Teco, a young girl who gradually became one of the most powerful people in the underground world of Orin and asked, "Our little The lord finally remembered to send a love letter to his fiancée?"

"If Dusande dares to waste precious traffic resources like this, then I'll go back to Albin and kick his ass." Lorraine said harshly, but her eyes were full of smiles, she put the order in her hand When it reached Schultz's hand, he said, "Let's see, our Grand Consul still has a way."

Du Sande made it clear in the order that he asked Central Teco to prepare and establish a bank as soon as possible.And this bank must conform to many characteristics in Dusand's design.

One of them is to accept deposits from the public.

[Give ordinary people high enough interest to entice them to deposit every penny in the bank. 】Dusande wrote in the order,【Use the absorbed funds to lend, and the interest rate is higher than the deposit interest-using this method, the bank can quickly expand its scale. 】

In order to expand the scale of the bank, Du Sande also specifically wrote, [If necessary, the approval of lenders can be appropriately relaxed.After the loan is released, the creditor's rights are mortgaged to other banks and continue to be cashed out for lending. 】

Up to this point, Central Teco has only reproduced the "mortgage leverage" created by Newsail Bank on Olin.To really bring down Olin's economic system, he has more specific instructions.

[After the bank has more than 3000 million pounds of cash available, buy coal from Olin’s coal producers that they will deliver in three to five months—order in advance and try to buy out all the production capacity of the month. 】The real killer move is here. Dusande and Escobar’s goal is very clear,【Buy out all their coal production capacity, and then sell it on the market at a high price one month in advance. 】

Absorb reserves and increase leverage through the financial market, and then use the capital advantage to suddenly buy out all future production capacity of coal production enterprises.This is the first shot in the economic war that Dusande fired - cross-market interference.

3000 million gold pounds can buy almost three weeks' supply of the entire Aolin Coal Enterprise.It is impossible to buy out all of them. After all, some large coal users have their own coal mines, and their demand for purchased coal is not very strong.

But others are different.When they find that the price of coal has skyrocketed by 100%, these companies may have only two options - stop production, or pay high prices to buy coal from Olin Development Bank to maintain production.

It is certainly possible to transport coal on a large scale, but it is a standard emergency.If they had bought expensive shipping coal, Olympian coal would have cost at least 29p a pound.The price has also risen by at least 70%.

At the same time, Olympian Development Bank can also use "coal objects that will be delivered in the future" as collateral to dismantle another sum of funds from other banks.Taking into account the soaring price of coal, this amount of funds will reach the level of about 5000 million gold pounds or even higher.

If these companies try to stop production, they will face the second trick of Olin Development Bank - forced divestment.According to imperial law, creditors have the right to require debtors to pay off their loans in advance.When the creditor makes such a request, he will automatically waive all the interest for the current month and only recover the released principal.

Most of the companies that will borrow from new banks like Olin Development Bank do not have much potential for development.The sudden increase in production costs, coupled with the double blow caused by the sudden withdrawal of loans, can easily overwhelm a medium-sized company.And as one company after another failed to repay their loans, a chain storm was born.

Since Olympian Development Bank has mortgaged the claims of these enterprises to other Olympian banks, the wave of failure will directly affect these mortgaged banks rather than Olympian Development Bank itself.Since the debt mortgage is only used as collateral rather than transfer of ownership, it does not affect Olin Development Bank's right to withdraw capital in advance.

Next, as long as Olin Development Bank forcibly defaults, at least half of Olin Bank will go bankrupt within a month due to insolvency.In order to avoid the risk of bankruptcy, they are very likely to start absorbing deposits from the public with reference to the model of Olin Development Bank.

And as soon as they start taking deposits from the public, Olin's economic end will be near.Under the high energy price, the operation of almost all enterprises will be seriously affected, and the funds that ordinary Olin people can get will be less and less.In order to absorb deposits from them, the interest rates of other Olin banks must be very high.

To pay high interest rates, you first need lenders willing to pay higher interest rates.Under high energy prices, it is impossible for other companies to have such a "bold act".They will definitely find ways to cut expenses, so as to use their low-cost advantage to survive.

Taking deposits from the public is not a free business.When it is difficult for ordinary people to obtain high returns, they will not be so stupid as to take out all the money that is eating interest.The public deposits absorbed at the beginning to avoid their own bankruptcy will soon become a reminder for these banks.When these banks can't afford to pay interest... a wave of runs and large-scale bank failures are inevitable.

This is the first type of economic warfare studied by Dussand and Escobar - cross-category market manipulation, and a wave of large-scale defaults after market manipulation.

(End of this chapter)