Market Behavior of Senior Traders: Reflections on the Cao Incident
When we learned that pickens, an American oil speculator, earned $3 billion in a few weeks, we also heard that Cao, led by Chen Jiulin, a businessman from China, lost $550 million in oil speculation. At this time, many people cursed pickens, while others felt sorry for Chen Jiulin, because Chen Jiulin, a newly elected new Asian business leader under 45, was deposed by oil futures, which was heartbreaking. Curse or regret. Profits and losses have occurred, and this is the reality we see. We must face up to a problem. In futures and options trading, China people are no match for big American speculators. There are no such masters in Asian countries, not even Japan with deep pockets.
Historian Braudel pointed out: "There are two types of exchanges, one is ordinary, competitive and almost transparent; The other is advanced, complex and thorough, and dominant. The mechanisms of the two types of activities are different, and the factors restricting them are also different. The capitalist field contains not the first kind of activities, but the second kind of activities. I don't deny that there may be a cunning and cruel rural capitalism. Usually, people don't distinguish between capitalism and market economy. This is because they have been developing synchronously since the Middle Ages, and also because people often describe capitalism as the driving force and full display of economic progress. In fact, everything is carried out on the huge backbone of material life. When the material life is enriched, everything will move forward, and the market economy will fill up quickly and expand its own network. Capitalism has always been the beneficiary of this expansion. "
I call people who engage in the second kind of trading activities "senior traders". Among this group of senior traders, there are few experts. They are the leaders of senior traders, not the high-end ones.
Braudel also told us: "Capitalists are friends of the king, allies of the country or people who use the country by hook or by crook. They crossed the boundary of "home country" early and consistently, and colluded with foreign businessmen. For their own self-interest, they try their best to play tricks by manipulating credit and by playing tricks between good money and bad money. Gold coins and silver coins are valuable and good coins, which are used for large-scale transactions and flow to capital; Copper money is worthless, it is bad money, used for wages and daily payments, and flows to the labor force. "
In addition to carefully studying the trade history of capitalism, Braudel must have also studied the speculative activities in the international financial field since 1970s. Therefore, he dared to draw a bold conclusion: "These people have information, intelligence and cultural advantages. They grab everything they want around them-land, real estate, fixed rent ... nine times out of ten, they rely on monopoly or necessary power to beat their competitors. Due to the abundant capital, capitalists were able to maintain their privileges and take over the international business at that time. "
In the confrontation between pickens and Chen Jiulin (accurately speaking, it was not like this at first, just because Chen Jiulin chose to short the oil price, and Chen Jiulin became pickens's opponent. If Chen Jiulin chose to do more in the low position, it would be another matter), pickens has experienced many battles, struggled in the oil market for more than 60 years, stumbled, paid tuition fees, and even nearly went bankrupt several times, and learned a lot; On the other hand, Chen Jiulin is just a fledgling person in the international oil market. It took six or seven years to make full preparations, but before I mastered the basic trading principles such as stop loss, I entered the crocodile pool of futures trading. In addition, pickens once stumbled in the oil futures market, and this round chose to manipulate oil prices, which was well prepared. In particular, pickens is a close friend of George W. Bush. It can be said that "the right time, the right place and the right people" are all accounted for. While Chen Jiulin has no advantage at all. Compared with pickens, Chen Jiulin is a complete misunderstanding in the oil futures market, hoping to make a lot of money by accident. Therefore, it is only a matter of time before Chen Jiulin is eaten alive by pickens in this crocodile pond.
Lessons learned from the oil futures incident.
In the new millennium, international capital will attack the most vulnerable currencies in a faster and more brutal way, stir up the most growing industries, and promote round after round of foreign exchange, stock and futures markets.
In the past, first-class economists focused on the study of production process and production relations. Now people pay attention to macroeconomics, economic leverage (such as interest rate, exchange rate and tax rate) and market efficiency.
Now, in addition to production capital, there is also a part of free capital that exists purely for trading, and this part of capital is getting bigger and stronger. Trading capital and production capital follow different laws. If the production capital mainly hopes to recover the investment by improving the operating efficiency of the enterprise; Then, trading capital is to make use of the liquidity and volatility of the market to make profits. The latter is highly liquid and speculative. Production capital and trading capital have crossed national boundaries and can flow relatively freely. From one market to another, from one company to another, from one stock to another, their liquidity and flexibility are very strong.
Manipulation is the best means of price monopoly. Manipulating the market requires three conditions: talent, capital and policy. If these three conditions can be met, the manipulation can be implemented immediately.
Needless to say, the planners of big funds and their collaborators are the best talents with rich professional knowledge, and more importantly, battle-hardened market experts.