I think Soros shorted the Thai baht on the premise that at that time, Thailand's foreign exchange reserves had begun to be in short supply and foreign funds were freely convertible, which was the basis for shorting the Thai baht.

For a simple example, after Soros discovered the shortage of foreign exchange in Thailand, he borrowed Thai baht with US Treasury bonds as collateral. For good calculation, suppose he borrowed 65.438+0 billion baht, and then suppose that the exchange rate between the United States and Thai baht is 654.38+0: 654.38+00.

After borrowing Thai baht, Soros converted 65.438 billion Thai baht into 65.438 billion US dollars, and at the same time released news that there was an extra 65.438 billion Thai baht in the market. Coupled with everyone rushing to change their Thai baht into dollars, the Thai baht in the market has risen sharply, leading to inflation ... Inflation has caused more people to change Thai baht into dollars, and there are more and more Thai baht in the market.

Assuming that it fell to 1: 20, Soros changed 50 million of the borrowed 1 billion dollars into 1 billion baht and returned it to the bank in Thailand, earning 50 million dollars in vain.

Of course, the actual situation is far more complicated than this. Soros also used various tools such as foreign exchange market, stock market and futures market. Flies don't bite seamless eggs. If the Thai government had not made a big mistake in policy formulation and implementation, Soros could not have plundered so much wealth created by the Thai people.