[Chapter 701: Someone Couldn't Hold On Anymore]
For the British, the end of 1992 was really tough. First, with the pound shorting, they were forced to withdraw from the European Exchange Rate Mechanism. Then came the crisis with Mr. Wealthy pulling his orders.
"Selling gold? Has this guy lost it? Isn't William White a hardcore bull on gold? What's he trying to pull?" Soros said, feeling frustrated. Although the gains from the pound were decent, they hadn't met expectations.
He aimed to make a quick score on the London securities market but discovered that William White was selling off gold.
"Sir, he's not just selling paper gold and spot gold; he's also shorting gold at the same time. The trading volume for London metal futures just doubled in an instant."
"Cough, this guy must be crazy. Check it out -- what exactly has changed?"
"Um, sir, he has at least five billion pounds in loans in London, and the collateral for these loans is gold. Rumor has it he plans to clear these loans."
"This is serious. Is he really planning to withdraw? Damn it, heading to Hamburg won't help! They have even stricter rules than in London. What's going to happen to my stocks?"
Soros was furious. Leaving the European monetary system was actually beneficial for London. At least for the foreseeable future, their export outlook remained solid.
But with William White throwing a wrench into the works, it was hard to make a judgment call. At the very least, those wealthy Arabs would have their doubts.
...
"Sir, the gold market is experiencing violent fluctuations. Greenspan called to ask if we needed them to mediate." Filson reported.
"Cough, did I hear that right, Filson? Such self-sacrifice could only come from those Soviet influences, right?"
"Uh, if they hold on any longer, the bankers in London are going to tear them apart."
"Come on, I'm just paying back a loan. Is there really a need to panic this much? If I go bankrupt, won't they just jump off a bridge?"
Filson was at a loss for words. It took time to build up debt. Paying back all at once? That was unheard of. Come on, big guy, those loans weren't entirely his -- many were borrowed from elsewhere.
"Tell those idiots that if they don't adhere to the spirit of the contract, the next round is not going to be so cheap. By the way, let the bankers know I need to return to the U.S. to pay taxes. As for the loans, I'll use stocks as collateral."
For a long time ahead, the currency would be depreciating. Oddly enough, gold was also seeing a drop in value. With William White able to secure cheap loans, he had no reason to pay them back immediately.
What? Using stocks as collateral meant different interest rates?
Cough, well, I'll just pay back early then. I'm practically broke except for money! You all should check my White Bank account -- it's all long-term deposits.
If anything, England was asking for trouble. Outside of the U.S., the second-largest financial market -- did they think Uncle Sam wouldn't want to deal with them? The Federal Reserve would only step in to mediate because they weren't ready.
After this deep lesson, William White believed the Brits would learn to speak more wisely. If their heads weren't hard enough, they shouldn't try to act tough -- didn't they realize this isn't a century ago?
"Sir, Soros got caught in this mess. London dropped 0.5 percentage points yesterday. Those financial stocks can fall easily, but rising back up isn't so simple."
William White was stunned. He hadn't expected Soros to be part of it. No wonder Greenspan stepped in -- this guy couldn't handle the heat.
"Wait, isn't this guy a hedge fund manager? Why is he not staying in his lane? If he's trading index futures, that could really be a headache."
Seeing Soros stumble was naturally amusing to William White. If it weren't for the backing he had, he would make sure Soros experienced a real disaster.
"Sir, besides Quantum Fund, he also has the Tiger Fund and other funds. The Quantum Fund is very risky; the others are milder."
"Humph, I'll let this one go -- originally, I didn't plan to drag it on forever. Next time, it won't be so cheap."
To be fair, England was just like Bush Sr., both on the wrong side of luck. If they held on for another three to five months, it would really be a different story. Going against the trend? It wouldn't matter how great William White was; an outright attack wouldn't be enough to faze him.
Don't be fooled by William White's current prowess; the truth is he had foresight. Using lean production for production and procurement, while his sales team was composed entirely of sales elites.
Such a bizarre company structure truly suited William White. Anyone else trying to learn from it would likely fall flat on their face.
...
"Sweetheart, are you coming back for Thanksgiving?"
"Of course, I'll be back after sorting out the promotional details."
"Hmph, you probably have a blast while you left us in Texas! I don't care; I'm going shopping on Sunset Boulevard!"
"Cough, Michelle, next year! As for shopping, you all go to White Center -- shop as you like! Just don't skimp on me. Los Angeles isn't ready yet; don't play silly."
"Fine, just come back early."
"Uh-huh, soon. There isn't much going on this year, and I'll be in Texas for a while."
"Seriously, that's great! Sweetheart, I miss you!"
"Alright, alright, I miss you too. Be good."
William White really had a lot on his plate; his family and business were becoming quite substantial, keeping him busy.
Of course, if the British didn't cause trouble, this year would actually have been pretty relaxing for him.
...
"Alan, does this mean William White has lost faith in gold?" Soros had a hint of frustration. It seemed like White had no intention of dealing with him; it was just bad luck for Soros.
Greenspan didn't know how to respond to Soros's inquiry either; he was feeling quite irritated as well. Being a pawn for someone was really a joke.
"George, that's basically it. His short positions have exceeded the spot holdings; this is no longer a hedge. He's truly bearish on gold."
"Ugh, that makes no sense! Inflation is so apparent. Even if gold doesn't have room to rise, it shouldn't be dropping either."
"George, did you forget about that Leo Wanta?"
"What? This guy really went and lost all his money?" Soros was startled this time. If that money left the market, what hope would there be for inflation?
*****
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