Chapter 1166 It’s better to buy a fund than to build a car

August and September of 2008 were really two months of universal celebration for China. With the convening of the Olympic Games and the continuous development of the economy, China was extremely excited and was simply a paradise on earth.

But in the United States, August and September were just like St. Petersburg in 1944. There was heavy snow in the sky, there were endless Soviet troops inside the city, and outside the supply lines had been cut off for several months, and then suddenly I heard the news,

Allied forces landed in Normandy.

This is basically the situation in the United States now.

With the collapse of major financial institutions, the entire United States is in a state of depression, with all industries ruined and countless factories closed. According to the latest data released by relevant departments, the unemployment rate in the United States has dropped from 3.7% in two months.

, soaring to 5.8% in one breath, which is equivalent to millions of Americans losing their jobs in these two months.

What is even more tragic is the housing price. In Manhattan, New York, before July, the average housing price per square meter was close to US$40,000 per square meter. But by September, the price had been cut in half to US$28,000 per square meter, and it is still falling.

According to estimates by some real estate experts, house prices are likely to eventually drop below $15,000.

And this is not an individual situation in Manhattan, but a general situation in the entire real estate industry. House prices across the United States have fallen by more than 30% in two months, and more than three-digit real estate companies have announced in these two months.

Bankruptcy... Because they couldn't build houses at all and saw that the more they lost, the more they would lose, so they simply stopped building and declared bankruptcy directly, which might save more property.

But the real estate industry is not the most unlucky. The most unlucky thing is the automobile industry. The entire American automobile industry has experienced a sharp decline. The worst thing is General Motors. The stock price has dropped from the original 28 US dollars to 6 US dollars. Only the original

1/5 of the stock price.

Apart from this, this is almost the case in all other industries. There is no industry in which the stock price can rise, and there is no industry in which companies have not closed down, or are not laying off employees...

Well, it can’t be said that there is none at all. It seems that the game industry has begun to rise against the trend. The sales data of major game companies have experienced a surge in the past two months, especially the data on the OO game platform. Two

In just one month, the total number of players has increased by 40%, and the payment amount has increased by 15%. In fact, major game companies have made a lot of money.

But this is also easy to understand, because there has always been a theory in economics called the lipstick economy.

The origin of this theory comes from the Great Depression of the last century, when the economy fell even worse. At that time, everyone generally believed that the entertainment industry would fall even worse. Because the remaining money must be used to purchase various daily necessities, and

Don't use it to buy entertainment products that cannot be eaten.

As a result, after actual investigation, it was found that lipstick, stockings, foundation, poker and other products actually had very good performance, and actually increased their sales a lot.

Later, through investigation, it was discovered that as the economy plummeted, a large number of people lost their jobs. After losing their jobs, they would be trapped at home. In addition to thinking about how to fill their stomachs every day, they also thought about how to make themselves happy, how to relieve worries, etc.

Etc., these people have created a lot of spiritual emptiness, so they need to fill these spiritual emptiness.

Men need tools such as poker and bridge to pass the time by playing cards. Women need lipstick and cosmetics like this to help themselves get rid of depression.

In addition, things like lipstick and stockings can also increase the interest of life and stimulate some desires, and then pass more time through certain exercises.

In the 21st century, games have become the best way to fill spiritual emptiness. A large number of people who are unemployed at home must kill time by playing games, which naturally leads to a surge in data in various game industries.

The skyrocketing data in the gaming industry will naturally bring huge benefits to 00 Network, making 00 Network one of the few companies that can buck the trend and rise.

At this time, a company that can continue to rise will inevitably become the best safe haven in the minds of many investors. If they throw all the little money they finally escaped into the OO network, they can still make some more money!

As a result, OO Network experienced unimaginable growth. After exceeding US$700 billion, it successfully exceeded US$800 billion in market value, once again setting an unprecedented record.

But the stronger the rise of OO Network, the worse the decline of other industries. In two months, nearly 3 trillion US dollars of assets have evaporated from the entire U.S. stock market. All industries are in mourning. More and more people are unemployed. The entire Internet

The explosion of negative emotions on the Internet is all a variety of insults against Wall Street and the government.

It’s not just the case in the United States. This trend has now spread to Europe and Asia. Anyway, almost the world’s financial markets have collapsed under the leadership of the United States. Nearly tens of millions of people around the world have lost their jobs because of this.

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Some readers may be surprised to see this. Isn't this just a subprime loan problem? Only real estate developers and lending institutions should be the unlucky ones. How could it affect so many industries?

This seems correct, but with the support of financial markets, the economies of various countries in the world, and even the global economy, have become a whole.

Not to mention anything else, first of all, the outbreak of the subprime mortgage crisis and the crazy revelations by the media naturally let countless Americans know that a large number of houses were bought by poor people who could not afford to repay their mortgages.

To repay the loan, the final result will inevitably be a sale through judicial auction.

But the problem is that people who originally had the ability and plan to buy a house had already bought a house in the first wave. At this time, most people’s motivation for buying a house was actually investment rather than outright need. Then there were a large number of people who were unable to repay their loans.

Houses appeared in the judicial auction market... The collapse of house prices became inevitable. A large number of people began to sell their properties, eager to escape from the real estate market that was about to collapse. This further promoted the situation.

The collapse of house prices.

After the collapse of house prices, the real estate companies collapsed immediately, because every time they bring an extra brick or build an extra piece of wood, they are destined to lose money.

Therefore, many real estate companies directly announced their suspension of business or bankruptcy. The first people to be laid off were the staff of those real estate companies. But this is only the beginning. After that, all companies that directly supply various building materials to real estate will go bankrupt due to the sharp drop in orders.

Secondly, due to the prosperity of the real estate industry, many real estate-related people spend very lavishly in the service industry market. Now that these people have no money, it is naturally impossible for them to spend lavishly in the service industry, so the service industry has also been affected.

This has had a huge impact, and the service industry has also begun to lay off a large number of layoffs.

These impacts are related, and the companies that supply these companies will also be greatly affected.

At the same time, due to the large number of layoffs in society, consumption power has declined urgently. Many people who have not been laid off will instinctively reduce consumption when they see this situation in the market, and find ways to save more money to cope with future risks, so that

The consumption rate of the entire consumer market has further declined.

This is only the physical impact, and even worse is the impact on financial markets.

In the past few years, the total number of subprime loan products packaged and put on the shelves has exceeded US$10,000 billion.

More than half of it is purchased and invested by various financial institutions and funds, and a large part is absorbed by social institutions.

Take Volkswagen, which has been rumored to have a complete break in its capital chain. It would have taken about half a year for the subprime mortgage crisis to affect the automobile industry.

However, it is another matter that Volkswagen's management used all its own funds to purchase subprime loan products.

Logically speaking, the funds in Volkswagen's hands are either used directly to distribute dividends to shareholders, or they are used to expand production and use the money to make more money.

But Volkswagen's management soon discovered that the automobile industry had entered a bottleneck. Expanding production could not make more money, and the profit might only be a pitiful few thousandths.

But investing directly in the financial market is different. As long as you use the money to buy subprime loan products, the annual return can be as high as 3%, which is much more profitable than a car.

Therefore, Volkswagen had US$100 billion in funds, all of which were used to purchase subprime loan products, and these products obviously no longer had the ability to collect repayments. At the same time, prices plummeted, and ultimately the US$100 billion shrank to less than 100

Hundreds of millions of dollars, basically all evaporated.

But this $100 billion in funds is used to maintain Volkswagen's daily operations. Workers are counting on this money to pay wages. Now you are telling me that all this money is gone?

As a result, Volkswagen was facing bankruptcy due to a broken capital chain.

The same situation exists for many other automobile companies. In addition to the energy industry, agriculture, etc., a large number of companies in other industries also follow the same example and use their money to invest in financial products that are more efficient in making money.

Now these products have all collapsed, and their capital chains have also collapsed. This is why in two months, more than 10,000 companies have declared bankruptcy due to broken capital chains.

And it’s not just American companies that are buying these financial products, there are also a large number of companies in Europe and Southeast Asia, as well as South Korea and Fuso. They are also enthusiastically buying these subprime loan products in the market that are guaranteed to make money. Doesn’t this directly affect the world?

Already?

Finally, as of the end of October, according to incomplete statistics, the number of US dollar assets that have disappeared due to this crisis has exceeded the terrifying scale of 10 trillion globally, and this number is still increasing. It is impossible to see
Chapter completed!