How did the American "Bombing Trilogy" against Japan actually be implemented?

Let's talk about how to make money by using stock index futures/options.

How to make money from stock index futures-First, Morgan Stanley found a Japanese insurance company, and then discussed with him: You see that the Nikkei index is 100 now, if it is 120 next month, I will give you 20 yuan, if it is 150, I will give you 50 yuan, and so on, and vice versa. The Japanese laughed at this. Fool, will the Nikkei index fall to negative? In fact, my profits are unlimited and my losses are limited. Besides, the Japanese think Morgan Stanley must be crazy. Do you still need to gamble on the Nikkei? It must have gone up all the way! Therefore, when the Japanese say they want to gamble, they bet big. This contract is signed in ten thousand copies. How about one year? Morgan Stanley said: OK, but I want the handling fee for each contract 10 yuan. The Japanese said: Deal.

Morgan Stanley is certainly not stupid. After signing the deal, they immediately returned to the United States and Europe to join hands with famous investment banks such as Goldman Sachs to crack down on the Japanese. What are they talking about? The Japanese are crazy. A group of senior researchers published a heavy report, pointing out that Japan's real economy is only growing at a high speed on the surface, but obviously, its growth rate is far behind the expansion of the stock market. More importantly, the gross profit of the real economy and various manufactured goods is declining rapidly. Excluding the income from real estate and financial speculation, the actual profits of some Japanese companies are even worse than those in the 1970s. Obviously, these international investment banks want to create panic and suspicion.

Then the investment bank headed by Goldman Sachs took this report and kept looking for funds around the world to invest in the Japanese stock market. Q: Aren't you worried about the safety of your investment in Japan? After reading the report, all fund managers concluded: Of course I am worried. What should I do to hedge my risk? These investment banks said: nothing, we do this business? You see, the Nikkei index is now 100. If it falls to 60 next month, I will give you 40 yuan, and so on. On the other hand, if it is 120 next month, you can give me 20 yuan. Of course, due to certain risks, every contract will be sent to you as soon as you buy it, 5 yuan. Even if the fund manager makes an account, he can hedge the risk of his stock portfolio and make money for free with high cost performance.

At the same time, regardless of the final Nikkei index, because these two bets are just right. Suppose the Nikkei index drops from 100 to 60, then the Japanese will leave 40 yuan and invest in the US. American investment banks only paid money to fund companies, so there was no loss at all. However, American investment banks participated in Japanese gambling and received 10 yuan, while American investment banks required funds to participate in gambling, so they paid 5 yuan, and American investment banks also earned 5 yuan. As long as the scale of issuance continues to enlarge, financial resources will be abundant.

How to make money with the Nikkei put option-similar to the previous example, the American investment bank said: Look, the Nikkei is now 100. Let's join your bet. Americans bet that the stock price will fall, while the Japanese bet that the stock price will rise. Isn't it? How to gamble? Americans say Japanese people will sit in the village. As soon as we participated in the gambling, we gave the Japanese 10 yuan the entrance fee. Whether we play or not, the tickets are all from Japan. If the index rises above 100, we won't play. If it falls from 100 to 60, the Japanese will pay me 40 yuan. If 100 drops to 30, the Japanese will give me 70 yuan.

These investment banks found a fund manager and told them, look, the Nikkei index is now 100, and you bet that the stock price will fall. How to gamble? As soon as you join the gambling game, give me the entrance fee of 15 yuan. Whether you play or not, the admission fee is mine. If the index rises above 100, we will not play. If it drops from 100 to 60, I'll give you 40 yuan. If 100 drops to 30, I'll pay you 70 yuan.

These two bets are just right. Suppose the Nikkei index drops from 100 to 60, then the Japanese will leave 40 yuan and invest in the US. American investment banks only paid money to fund companies, so there was no loss at all. While American investment banks paid 10 yuan for participating in Japanese gambling, fund companies paid 15 yuan for participating in American investment banks' gambling, and American investment banks also earned 5 yuan.

Second, the margin trading system is an indispensable weapon to suppress the stock price.

First of all, ask a question, why are so many people willing to buy? Because of a series of financial opening before Japan, the fund got a free ATM at this time. What ATM? First of all, Japan approved a system similar to ours in 1987, so that these funds can borrow shares from Japanese brokers and sell them. For example, if you lend a stock of a Japanese securities company and sell it at today's price of 100 yuan, you can buy it back and return it to Japanese brokers when the stock price falls to 60 yuan tomorrow. Since you sold it at 100 yuan and 60 yuan bought it, you earned 40 yuan. And if everyone does this, the stock price will fall. Therefore, the margin financing and securities lending system is an indispensable weapon to suppress the stock price.

Third, foreign investors must become members of the exchange to operate margin trading.

Please note that if Tokyo Stock Exchange 1987 does not approve foreign securities companies to become members, they will not be qualified to engage in margin financing and securities lending business, so they cannot suppress the Japanese stock market.

In fact, the following figure most clearly describes the role of stock index futures and stock index options. Three gray words indicate that Nikkei futures or options have been launched overseas. The first time was in September on the Singapore Stock Exchange 1986, the second time was in June when American investment banks such as Morgan and Goldman Sachs launched the Nikkei put option in the OTC market in the United States, and the third time was in September 1990. It fell by nearly 20% for the first time, by nearly 30% for the second time and by nearly 40% for the third time.

Prior to this, Shangtou Morgan became a member of Osaka Stock Exchange on 1987, and Shangtou Morgan was allowed to set up an investment consulting company. Subsequently, Osaka Stock Exchange launched Nikkei index futures at 1988, and Osaka Stock Exchange launched Nikkei index options at 1989. Thus pave that way for the layout of Morgan and others in Japan. You see, coincidentally, these three time points all correspond to the sharp rise of the Nikkei index. In fact, they just want to make Japan full of bubbles, and then they can reverse short, so that they can play the "ATM" strategy mentioned above. Of course, with the Japanese stock index plummeting, American investment banks and investors who bought bearish stock index futures and options made a fortune.

With the "Nikkei Put Option" listed and sold in less than one month from June 1990 to June 1, the Japanese stock market has completely collapsed, and the scene of scrambling to sell is like the end of the day.

Of course, with the collapse of Japanese stock index, investors who buy bearish stock index futures/options have made a lot of money. The stock market crash first affected Japanese banks and insurance companies, because they sold Nikkei options to American investment banks, and a large number of banks and insurance companies had a payment crisis. After the financial crisis, the Nikkei index fell further, which led to the decline of the stock price of the entity enterprises and the collapse of the Japanese stock market. Of course, the Japanese stock market crash inevitably hit the property market, and also caused the collapse of the Japanese property market, which has not recovered so far.