Goria's tone was full of confidence. He knew in his heart that Germany just wanted to teach Italy a lesson, but he did not want the Lira to really collapse. This would not be of any benefit to Germany. On the contrary, with the delicate relationship between Italy and Germany, if the Lira collapsed like Mark, it would only have bad things for Germany.

At this time, go to Schlesinger to borrow money, and you can definitely borrow it.

However, Qianpi has no confidence in this, not that he has no confidence in borrowing money from Germany at this time, but that he has no confidence in the Lira.

As for the reason... Qianpi didn't know, he just felt uneasy in the dark, a bit like the feeling of market developed by traders, but not completely. If you have to say a closer reason, it is probably because Qianpi was immersed in the financial field for many years and developed with rich experience.

Of course, not knowing money does not mean that others don’t know.

As a stubborn person, if Shen Jiannan could sense the uneasiness of money now, he would definitely give a thumbs up for the richest and chaotic central bank governor.

The operation of the European exchange rate mechanism is based on the interference of central banks in various countries on exchange rates to maintain a limited range.

Each currency participating in the exchange rate mechanism will be assigned a target exchange rate for the European currency unit, which is called the central exchange rate of the European currency unit of the country's currency. The ratio of the central exchange rate of any two European currency units is defined as the bilateral central exchange rate between the two participating countries. Combining all bilateral central exchange rates together forms the parity bar of the European exchange rate mechanism.

Every participating country has the responsibility to maintain its currency in the grid and allow a pre-determined fluctuation. The fluctuation range of the participating country's currency is ±2.25%, but some currencies are allowed to float within a larger amplitude, ±6%. In order for this mechanism to work effectively, members should coordinate each other's monetary and fiscal policies and implement an orderly economic structural reform.

Member States should also agree to directly intervene in the foreign exchange market to maintain their currencies’ position in the European exchange rate mechanism.

In the past decade since the birth of this exchange rate mechanism, it has been operating well, and the central bank no longer has to worry about the harm caused by violent exchange fluctuations. It is just like automatic cruise, which saves worry and effort.

But that is already a past tense.

At the beginning, the European economic and monetary system established a new currency unit, Aiju. This currency unit originated from a currency weighted average, weighted by GDP in 1979 and based on the currencies of the European economic and monetary system member states in 1979. The constituent factors of European currency units will be adjusted periodically to reflect the changes in GDP of member countries.

When new currencies are incorporated into the European economic and monetary system, the composition of European monetary units will change.

It seems that everything is perfect.

But there is a small problem in this.

The problem is that under the European exchange rate mechanism system, the economic levels of each country are different, so the interest rates of each country are completely different.

Therefore, this small problem means that you can make sure to make money and not lose money.

That's right, it's just a sure profit or loss.

This is a very ridiculous little problem. Anyone who pays sufficient IQ tax knows that there is never a stable profit or loss in the investment field. When a person tells others that he can guarantee stable profit or loss, either he is God or he is a liar.

But as the saying goes: God is reliable, sows will climb trees.

If someone really could make a profit without losing money, then the financial market would no longer exist.

However, the interest rate differences among countries do provide smart speculators with a chance to make a stable profit and not lose money, which was the famous "convergence trading".

What is convergent trading?

This is a very complicated thing.

It can be roughly explained that looking for securities with mismatched prices relative to other securities, long low prices, and short high prices. There are generally four categories of transactions: convergence of sovereign bonds; convergence between new and old bonds of government bonds; convergence in the securities market.

In short, it can be understood that the common currency unit ranks below, but different interest rate differences exist in countries. This difference means that traders and investment managers can freely invest in the currency of European exchange rate mechanisms with the highest returns without worrying about exchange rate risks, because the currency exchange rate within the European Community is fixed.

Why do you say so?

It is also the European Community exchange rate mechanism. When a member country's currency rises or falls to a floating margin, the central bank of the country has the responsibility to stabilize the exchange rate according to the operation of the exchange rate mechanism.

One of the important factors that promote capital inflows is that international investors increasingly believe that European exchange rate mechanism member states are in the process of constantly moving closer to European currency units. In this case, interest rate differences in European exchange rate mechanism currencies are conducive to high-yield European exchange rate mechanisms will increasingly overestimate the actual risk of exchange rate depreciation.

It is conceivable that there is no need to worry about speculation about exchange rate changes, which almost means making a stable profit and not losing money. Anyway, central banks of various countries will pay for the bottom line.

The favor of convergent trading is almost everywhere. A securities portfolio manager claims that it is equivalent to "government-funded hedging transactions". The European exchange rate mechanism has driven a new level of money market mutual funds to become popular at an astonishing rate that specializes in trading short-term securities of high-interest foreign governments.

As a securities portfolio manager argues on the trading: “Since you can get higher returns from Spanish or Italian government bonds without compensatory risks, why should you keep an eye on the returns from Sidmark government bonds?

Therefore, the European exchange rate mechanism has pushed a new level of money market mutual funds to become popular at an astonishing rate that specializes in trading short-term securities of high-interest foreign governments.

According to Morningstar, between 1989 and 1992, these funds absorbed more than 20 billion US dollars of investors. The main securities investment behavior of these funds is convergent transactions. As for the overall scale of market positions, the International Monetary Fund has calculated that the total scale of convergent transactions may reach 300 billion US dollars.

This is what Qianpi has always been worried about electronic nomads, although he did not know the actual amount of convergent transactions conducted by global capital through the computer Internet.

Ring--

At six:30 in the morning, the harsh phone ringing rang in the early morning, disturbing Shen Jiannan who was sleeping in his dream. He leaned over Yulia's chest, and grabbed the satellite phone placed at the head of the bed.

"Boss. The Italian Bank just announced that it would raise the discount rate to 12%. Do we still need to build positions according to the plan?"
Chapter completed!