Manhattan Reborn 1978

Manhattan.

Wall Street, Stanley [-]th Floor.

David called Sam who was busy and told him about Bernard Madoff.

After pondering for a few seconds, Sam gave his personal opinion.

"If you still can't believe Madoff, we can add some new restrictions to the terms of his investment of the money."

"for example.."

"No, Sam~ forget it!"

“The annualized rate of return of 13% is indeed higher than the return promised by most fund companies now~”

"But I believe in you, you can do it, right?"

Sam made a helpless smile with raised eyebrows and said: "So...have you been waiting for this test?"

"Hahahaha~ This is not a test, but my trust in you!"

"...Okay~"

After making sure David was okay, Sam walked out of the office.

David was sitting in a quiet office, but his heart couldn't calm down~

So far, he has done everything he can and should not do~

The rest can only be verified by time!

He looked down at the few oil stains and dirt on his suit jacket that he accidentally splashed on while eating lunch, and once again found a good excuse for himself. .Have a holiday!

----

new York.

Manhattan area.

Not far from Wall Street, at 33 Liberty Street, there is a 14-story building built with huge stones.

It is a bank built in the New Renaissance in 1924. It is the most important and influential reserve bank in the U.S. Federal Reserve System, the Federal Reserve Bank of New York.

The Federal Reserve Bank of New York, responsible for the Second Reserve District, occupies a pivotal position in the financial field of the United States.

One of its most important customers is the US government.

The U.S. Treasury's account is opened at the Federal Reserve Bank of New York, which acts as the U.S. Treasury's bank.

It is different from the other 11 regional reserve banks in the United States because of its location in the financial center of the United States. It directly implements the monetary policy of the federal government, conducts a large number of foreign exchange transactions, and manages a large part of the debt of the U.S. Treasury Department.

The president of the Federal Reserve Bank of New York is a life member and vice chairman of the Federal Open Market Committee, which sets interest rates.

(ps: The annual salary of the president of the New York Fed is more than twice that of the president of the Federal Reserve Bank of America; some people explained that the cost of living in New York is higher than that in Washington.)

Because, within its sphere of influence, New York, Manhattan, and Wall Street are home to a large number of American and overseas banks.

Therefore, the Federal Reserve Bank of New York, under the guidance of the Federal Development Market Committee (FOMC) and the Department of the Treasury, is responsible for implementing monetary policy and protecting normal currency circulation.

At the same time, in the local system of Federal Reserve Banks, the Federal Reserve Bank of New York is also the most powerful bank supervisor.

This makes the Federal Reserve Bank of New York responsible for implementing and executing the decisions of the Federal Development Market Committee on monetary policy through transactions in the money market.

It is also entrusted by the U.S. Department of the Treasury to monitor the daily fund turnover activities of the U.S. federal government, as well as major strategic fund turnover activities.

Moreover, it is not only responsible for monitoring and controlling the daily business transactions of the U.S. banking industry, but is also responsible for maintaining official payment business relationships with central banks around the world and executing foreign exchange transactions.

Once, a president of the Federal Reserve Bank of New York described it this way: The Federal Reserve Bank of New York plays a leading role in monetary policy, financial supervision and payment systems.

. . .

In addition, under the ground of this 14-story building, more than 20 meters deep, lies the world's largest "gold treasure house", which stores gold ingots worth hundreds of billions of dollars. It is an out-and-out gold vault!

This vault is half the size of a football field and is surrounded by the hard rocks of Manhattan Island. The interior is divided into more than 100 warehouses.

Among them, the largest warehouse can store about 10.7 gold ingots. The stack is 3 meters high, 3 meters wide and more than 5 meters long. .

However, today, only about 15% of the gold stored in the world's largest vault belongs to the U.S. government, and the rest is stored here by banks around the world. .

After the outbreak of World War II, most countries in Europe were covered by war. As a last resort, the central banks and commercial banks in these countries shipped their gold reserves here for storage.

After World War II, they did not transport the gold away because the Federal Reserve Bank of New York did not charge custody fees to any country. .

. . .

Wednesday, October 1978, [-].

On this sunny autumn afternoon.

In a conference room on the ninth floor of the Federal Reserve Bank of New York, more than two dozen big guys who control the lifeline of the entire American economy are sitting or standing patiently waiting for today's protagonist to appear.

ten minutes later.

A tall, well-dressed, middle-aged man with gray hair on his temples led two people into the conference room, smiling and greeting everyone cordially.

The person coming is Fullerner Kurutel, the current Secretary of the Treasury of the United States federal government.

Fulner Kurutel, a Jew, was born in 1926 in Germany under the Weimar Republic.

During World War II, in order to escape the tragic fate of being persecuted, he and his family fled Germany and Europe. After several twists and turns, he came to the United States.

He studied international economics at the University of California, Berkeley, and Princeton University, and became an entrepreneur.

After that, he entered politics and became the 64th Secretary of the Treasury of the United States in the Warren White administration.

But today, Fulena Kurutel is not just here to gather and hold meetings with you in his capacity as the Minister of Finance of the federal government.

He also has another job title, temporarily acting as chairman of the Federal Reserve Bank of America~!

. . .

The protagonist Fulena Kurutel arrived, and everyone took their seats. After several active phones were placed, the conference room gradually became quiet.

Among them, a thin middle-aged man who had just been affectionately called Julie by everyone spoke first with a smile.

"If no one wants to go to the bathroom, we'll close the door... shall we start?"

"Hahaha~"

After everyone laughed, they all looked at Fulena Kurutel, who was sitting at one end of the rectangular conference table, and became quiet again.

Fullerner nodded slightly to Julie who had just spoken, and after quickly scanning everyone's faces, he said loudly.

"Gentlemen, I believe you have heard about the meeting in San Francisco~"

"So, we are gathered here today. If you have any questions, you can ask them freely~"

"Even if...I can't give you the answer to the question, I will communicate with President White and tell you the answer clearly~"

Soon, before he finished speaking, a person raised his hand first and said: "Is the Washington government going to open its doors?"

"...Yes~ The shutdown will end tomorrow and we will reopen to work~"

"Haha~" The person who asked the question smiled and continued to ask.

"Actually, you don't need us to ask questions~!"

"The reason why we came here and sat down to hold this meeting with you is that you know in your heart what we care about!"

"So, tell me frankly what you think...or the government's decision!"

Fullerner looked around and said cheerfully: "Okay~"

"After the government reopens this time, the "International Banking Law" bill that has not been finalized before will be voted on again by Congress tomorrow~"

"Judging from the news I have received so far, the probability of it being passed is very high!"

The International Banking Act that Fullerner mentioned was the first federal legislation in history approved by the U.S. Congress to uniformly regulate the financial activities of foreign banks in the United States.

Its core content is very simple to say~

It re-stipulated that foreign banks and domestic banks in the United States should carry out business activities on an equal basis~

In terms of more specific details, like the Bank of the United States, foreign banks have access to the federal payment system, discount windows and deposit insurance; they can choose a state as their base and must abide by the relevant laws of state-level branches; they can set up branches and deposits in the United States. Insurance, reserve requirements, etc. enjoy the same treatment as domestic banks in the United States.

After the 60s, the number of branch banks, offices, representative offices, etc. established by foreign banks in the United States increased rapidly, and the total assets expanded at an accelerated pace.

However, there is no unified law to regulate its financial activities, and registration and management are scattered across states.

In 1972, the U.S. Federal Reserve Board established the International Banking Committee, which, together with the Congressional Joint Economic Committee, conducted a comprehensive investigation into the activities of foreign banks in the United States.

They believe that it is necessary to establish unified federal legislation to regulate the financial activities of these foreign banks in the United States.

Therefore, this bill will definitely play an important role in controlling the scale and structure of foreign banks' credit in the United States, as well as risk management and stabilizing the financial market.

However, everything in the world is like a coin, everything has two sides!

The "International Banking Act" also clearly stipulates that foreign banks are prohibited from taking advantage of their business operations to participate in U.S. political affairs, or participate in political loans or investments; they are prohibited from annexing or purchasing U.S. non-bank companies, enterprises or It holds stocks of American companies and enterprises; and has clearly defined limits on the amount of its acceptance business.

In addition, the federal government also imposes many regulations on the interest rate management, supervision and inspection of these foreign banks, similar to the management of U.S. banks.

Emm. .

The new provisions in this bill seem to protect the interests of domestic banks in the United States and curb the barbaric and disorderly development of foreign banks in the United States. .

But among the more than 20 financial tycoons in the conference room, most of them had already reached cooperation with some foreign banks in order to increase the competitiveness and business volume of their own banks before this bill was passed~

Therefore, after people in the conference room heard the first "good news" brought by Fullerner, some showed a hint of joy, some gritted their teeth silently, and some looked blank, as if the matter was nothing to do with them. , there is no disturbance in my heart. .

. . .

As the government’s Minister of Finance, Fullerner Kurutel is not in the mood to pay attention to some of the people’s inner thoughts, let alone have the time to speculate~

He directly said another news brought today: "Gentlemen, we will hold an internal meeting of the Federal Reserve Bank of America here at [-] o'clock tonight~"

"There is only one issue for the time being, whether to increase the standard interest rate and the rate of increase!"

"We will announce the results of this meeting to the public tomorrow morning~"

"When the time comes, please be prepared!"

After Fulner finished speaking, he didn't give anyone a chance to speak. He turned to look at the middle-aged Julie who had just spoken, and talked about the last news he brought today.

"I think everyone may have heard some rumors. Someone submitted suggestions to the Treasury and the Federal Reserve through the New York Fed on increasing the structure of MBS circulation and expanding its commercialization and trading scope."

"MBS is the earliest type of asset securitization and was produced in the 60s."

"It is an asset securitization product mainly issued by U.S. housing specialized banks and savings institutions using the housing mortgage loans they lend."

“The proposer this time wants to pool together the loans that meet certain conditions among the housing mortgage loans lent out to form a mortgage loan collective, and use the regular cash inflows of principal and interest from the loan collective to issue issuances. Securities.”

“Government agencies or government-backed financial institutions will guarantee the securities and conduct secondary sales to investors and institutions with low-risk preferences.”

"In this way, the principal and interest generated by the mortgage pool will be transferred and paid to MBS investors intact, so that the funds accumulated in the housing mortgage loans issued by the bank can be active and circulated again."

Fullerner paused for a moment, raised his left hand, and introduced to everyone: "This is also an old acquaintance of everyone, the Chairman of the U.S. Securities and Exchange Commission (sec)~"

"This person may be unfamiliar to you. He is Professor Beluso Neville of Harvard Business School."

“After our research and discussions, we decided to use the Federal National Mortgage Association (Fannie Mae) as an intermediary to collect qualified housing mortgage loan contracts from major mortgage banks and form an asset pool for rating, After packaging, it will be handed over to major banks or investment banks for sales.”

"Of course, if you want to use the bank's own funds to pool a mortgage-backed securities asset pool, that's OK too~"

"However, before you make a sale, you must get the rating from the credit rating agency and file it with Fannie Mae!"

Fullerner looked at Julie: "Danas International Credit Rating Company will be the first designated credit rating agency to be put on the market after the reorganization of MBS~"

"After this batch of experimental MBS innovative financial products are successfully sold on the market and no problems occur under our follow-up observation~"

"We will gradually relax restrictions on rating agencies and allow rating companies such as Standard & Poor's, Moody's and Fitch to join in~"

After hearing what Fullerner said, Julie didn't care about the eyes of the people around her and across from her. She leaned back happily, preparing to be a low-key invisible person. .

Julie is just a familiar name used by some of his old friends.

His full name is, Judith K. Morgan!

Danaus International Credit Rating Company, the Morgan family controls more than [-]% of the shares. .

. . .

After Fullerner finished speaking, he saw that no one in the conference room spoke, so he motioned to Professor Beluso Neville beside him.

Professor Neville nodded, coughed slightly, and after sorting out his thoughts, he said something "from the bottom of his heart" to everyone in the conference room~

"Throughout my entire academic career, I have been studying the Great Depression of the 30s~"

"The biggest economic crisis in the history of the United States, the Great Depression, first started with the collapse of the stock market~"

“However, what has really hit many real economies in the country is not the price collapse of the stock market, but the collapse of the credit system in our financial sector!”

"Ordinary people, they can't borrow money to do anything, they can't buy a house, they can't get more loans and financing to save their business, they can't buy goods, etc."

"Credit has the ability to support a modern economic system!"

"The disintegration and loss of credit can quickly, absolutely and irreversibly ruin everything~"

"Gentlemen, today we boldly put MBS, as an innovative financial product, into the secondary market."

"There is nothing wrong with MBS itself. Instead, it is a great innovation!"

"In the hands of the right people, it can become the greatest tool to make the banking and financial industries prosper again~"

"It can also become the biggest accomplice in the hands of some greedy people who want to do whatever they want!"

"So, please understand!"

“If we can’t control our inner greed, we will have a repeat of the Great Depression decades ago!”

"And this time... what we're going to face is going to be much, much worse..."

After Professor Bellusso Neville finished speaking, there was silence in the conference room.

Is what he said alarmist?

Not!

Once upon a time, someone assigned a time period to the Great Depression, between 1929 and 1933. .

Many of you here have personally experienced the Great Depression. .

The Great Depression was triggered by a financial crisis caused by wild speculation.

Therefore, in 1933, Franklin Roosevelt, who replaced the exhausted President Hoover and became the 32nd President of the United States, adopted what later generations called the "Hundred Days of New Deal."

The main content of the New Deal can be summarized by the "Three Rs", namely Recover, Relief, and Reform.

Moreover, after Roosevelt came to power, he increased the government's participation in economic policy, which is Keynesianism. .

Today, President Warren White in Washington, like Franklin Roosevelt, is a member of the Donkey Party.

Recover, President White has already begun to promote some related bills in Congress.

Relief, President White’s proposal to increase relief funds has been passed by Congress a few days ago.

Reform!

After President White came to power, he once said that to solve the stagflation problem in the United States, we must first solve inflation, control prices, stabilize people's livelihood, increase employment, etc.!

Judging from the speeches made by Finance Minister Fullerner and Professor Neville, everyone in the conference room felt increasingly confused as they listened.

Could it be. .Is this President White going to do something surprising again?

Fullerner, after Professor Neville spoke, waited for a few seconds, and then continued as if he had guessed what everyone was thinking.

"The day after tomorrow, October 20th, in the morning!"

"President White will give a televised speech to show the latest solutions to many domestic problems after the government is restarted~!"

"If you have any questions, please wait patiently for two days and we will get the answer!"

"No, Fulner, I still have questions!"

In the conference room, a gentleman who had just been silent raised his hand and signaled loudly.

"Haha~ Please tell me!"

"You just mentioned that foreign banks will compete on an equal footing with domestic banks in the United States~"

"Then can they buy and sell mbs products?"

Fullerner turned to look at the chairman of the U.S. Securities and Exchange Commission (sec). After a brief exchange of ideas, the two men pondered for a moment before answering.

"Theoretically, after we pass the trial period, foreign banks can buy and sell MBS products!"

"What about the interest rate?"

"If the Federal Reserve raises the benchmark interest rate, will the income of MBS products also increase accordingly?"

"Of course! The interest rate income of MBS products will fluctuate with the benchmark interest rate, just like treasury bonds."

"What about buyers of MBS? Are there any regulations?"

"Have!"

"Currently, it can only be sold in the secondary market to institutions and banks with low-risk return requirements."

"What about the future? Will restrictions on buyers be relaxed?"

Fullerner smiled and spread his hands and said, "Yes, we must abide by all market principles."

"What about sales? Which companies and institutions are you selected as experimental companies?"

"The tentative ones include: Goldman Sachs, Morgan Stanley, and Merrill Lynch, three investment banks."

"Why are there only three of them?"

"..."

In the conference room, people began to ask various questions.

Fullerner did his best to answer those who could give them. If he couldn't give the answer right away, he could only write it down first and tell the other party that he would give the answer in a few days.

Time flies.

Regardless of whether the big guys in the conference room were satisfied or dissatisfied, Fullerner announced that the meeting had adjourned after more than two hours.

Wait until everyone has dispersed.

Fullerner grabbed Professor Bellusso Neville, who also wanted to leave. The two walked out of the conference room and went inside a New York Federal Reserve building. They prepared an independent office for the Minister of Finance. They closed the door and started chatting.

Fullerner poured a glass of wine for both of them, sat down, rubbed his temples, and asked his old friend Professor Neville.

"What you just said at the meeting, do you think they will use MBS to play more tricks out of greed and cause a new round of credit crisis?"

Professor Neville smiled bitterly, took a sip of wine slowly, shook his head and said: "People who are chasing more and greater profits are often blinded by the beautiful scenery in front of them."

"My words are just to remind them~"

"In the short term, it may have some effect~"

"But in the long run, high-quality MBS products on the market will always be sold out one day!"

"At that time... I dare not and cannot imagine whether they will do something more stupid because of greed!"

Fullerner also smiled bitterly and nodded: "Yes~greedy..."

----

It was getting dark and the street lights were on.

Manhattan area.

42nd Street, the Allston Street informant's office diagonally across from the Wildfire Bar.

Auston, who was about to get off work, welcomed his immediate boss Matthews.

ten minutes later.

Auston stood at the door of the office, watching Matthews walk away, and shook his head slightly in silence.

The perverted killer who committed crimes continuously in New York committed another tragedy after he solved the "Sting" case.

Matthews came here for one thing only.

Increase the bounty three times and use all means to bring this perverted serial killer out of New York in the shortest possible time!

turn. .

How?

Just rely on those police officers in the New York Police Department who stare at their watches all day long and look forward to getting off work?

hehe~

Auston rubbed his chin with his fingers, turned around and walked to the phone, picked up the phone and dialed.

This is a great opportunity to expose your street tipster!

Now the size of the team of people he manages has expanded to more than a hundred people ~

Auston believed that these auxiliary police officers who roamed the streets all day long would look at all the suspicious persons with red eyes after learning that the bounty had been doubled. .

Money and silk are so touching!

----

Manhattan area.

Holding a slice of pizza in his hand, David lay beside the bed in the bedroom of Black Mike's apartment, studying some documents and notebooks scattered on the bed.

After a few minutes.

David stuffed all the pizza into his mouth, clapped his hands, walked out of the bedroom, and motioned to Mike Bai, one of the four bodyguards who was also eating pizza for dinner.

"Aalto told me... there are some people who also want to join the real estate development project with the property rights of their unfinished houses."

"Please help me find out who these people are!?"

Mike Bai raised his eyebrows, sucked his finger, and smiled: "Do you just want to know their identities? That's very simple~"

David put one hand on his hips and pointed at Mike Bai with the other, laughing and scolding: "I asked you to do some investigations, not to intimidate others!"

"Remember~ If they just want to increase the housing price, I can accept it if the premium is within 30% of the market price!"

"If they still don't want to sell, don't use your fists to solve the problem. Just tell me when you come back. I'll do the rest!"

"Okay~" After Mike Bai's little calculation was revealed by David, he shrugged to a few people, stood up with a smile and walked out.

"Tonight, I can do it!"

"Tomorrow morning, I will bring you good news!"

When David saw that Mike was about to walk out of the room, he thought for a moment and then said to him: "Be careful!"

"I know~ You talk a lot of nonsense..."

"fxxx! You bastard!"

"Hahaha~"

Mike Bai is gone.

In the living room, the remaining three bodyguards were all smiling and eating pizza for dinner, bragging and farting happily with David.

After a while.

After relaxing, David returned to the bedroom and looked through his notebook, looking for ways to use Bernard Madoff's money to invest in businesses with higher short- and medium-term returns. .

----

ps: In the previous chapter, the US tax law and Bernard Madoff were mentioned.

At the end of that chapter, I missed one thing~

In the case of Bernard Madoff's Ponzi scheme, which was hailed as the biggest fraud of the century by the media, many investors and victims got their money back from the IRS after the incident and thunderstorms. Taxes reported over the years.

Later, some careful people made statistics.

In the Madoff case, the largest loss was not caused by banks or institutions, but by the IRS.

After the incident, the IRS refunded more than $200 billion in taxes to investors who had filed and paid taxes in the United States.

this. .I don’t know if IRS’s heart is bleeding and her body aches?

hehe~

----

The following is some popular science about the U.S. government shutdown and shutdown.

If you don’t like it, you can skip it~

In 1976, in order to draw lessons from the protracted Vietnam War, the U.S. government passed a bill, referred to as the Federal Budget Approval Act.

The act establishes standard procedures for the federal government's budget.

The first step is for the president to submit a complete budget proposal to Congress.

In the second step, both houses of Congress (Senate and House of Representatives) vote to pass the budget.

The third step is for the subcommittees of both houses to review the specific appropriation bill.

The fourth step is for the two houses to vote on each appropriation bill.

In the fifth step, the president signs the appropriation bill and the budget begins to be implemented.

If any of the above five steps cannot be carried out, the budget bill will be difficult to produce. .

For example, although the House of Representatives approved the budget bill submitted by the president to Congress, the Senate did not vote to pass it, and the budget bill was "stuck."

For another example, if the first four steps have been passed and the president finally signs the appropriation, the president finds something inappropriate and refuses to sign, and the budget bill will be "stuck" again.

If the president puts forward a budget proposal and the money is not approved before the start of the fiscal year, the government will have to "shut down."

It should be noted that "government shutdown" does not mean that all departments are closed or that the entire government is shut down.

The most common one is "department budget difficulties" ~

For example, if the budget of the health or education department is not approved, it will have to close down, but other departments with approved budgets will still work normally.

Therefore, if we want the government to "reopen the door", we must identify the main contradictions and resolve them. .

Also.

After 1976, the federal government at the "central level" in the United States has been closed down as many as 21 times, and state and other local governments have even more "dropped the chain."

Looking at the situation of federal government shutdowns, the Elephant Party has more government shutdowns, but the cumulative number of days is less.

Although the number of shutdowns of the Donkey Party government is less, the cumulative number of days is almost twice that of the Republican government.