A major stock market crash swept across Western countries, causing heavy losses in the capital market. Research institutes such as Harvard University were not affected at all. However, the stock market crash still made the School of Economics somewhat embarrassed.
They make a special economic report for the country every year, which is similar to China's economic plan. The report should explain this year's economic development and response measures.
However, China's planning is done by government departments, while in the United States, it is prepared by specialized consulting agencies, and the government will provide them with funding. For example, this year, the U.S. government provided five million in funding to the Harvard School of Economics.
In this completed economic address report, it was clearly pointed out that the current problem in the United States is that with the continuous improvement of productivity, the traditional domestic market has little potential and can only be upgraded.
Upgrading is to eliminate the original backward equipment and replace it with new equipment and new technologies. This process generally takes several years, or even more than ten years, and consumes astronomical amounts of money.
But now, productivity development is a general trend around the world. The concept of economic integration has been proposed. In the process of integration, Western countries will continue to improve their technology, while those economically backward countries do not have the foundation and conditions.
To reach the level of developed countries, if they want to improve productivity, they can only accept the backward production capacity of developed countries. Taking this opportunity, developed countries can sell obsolete equipment and technology to backward countries in exchange for funds to use to upgrade technology. This is
A virtuous cycle in which both parties are happy.
At this juncture, China, as the largest developing country in the world, has proposed the national policy of reform and opening up, which is undoubtedly a once-in-a-lifetime opportunity. They have a population of one billion, and their overall living standards cannot even meet the food and clothing requirements.
The huge market will drive the development of countless industries as long as the overall improvement is a little bit. The US government must take advantage of this opportunity to export a lot.
This suggestion attracted the attention of the U.S. government, and even the president held several meetings to discuss the matter. It is considered a proud work of the Harvard School of Economics.
However, when assessing the domestic economy, economists pointed out that although the growth rate of the domestic economy has slowed down, the overall economy is still running smoothly and there will be no fluctuations in the short term. They also specifically mentioned the stock market. Although there will be small fluctuations, they will not fluctuate.
It will affect the order of financial markets.
The stock market has indeed continued to fluctuate in the past two months, but overall it is still a bull market, which is consistent with smooth operation. However, the sudden stock market crash on September 16th shattered all illusions. This is not the case.
It affects the financial market! It is a direct and devastating blow.
As the head of the School of Economics and a member of the National Fiscal Policy Advisory Group, Professor Wilson, winner of the Nobel Prize in Economics, felt too shameless, although no one could have predicted that such a big stock market crash would occur, and the responsibility
It wasn't him either, but he still felt ashamed of it.
When Liu Lang arrived, Professor Wilson was summarizing experience with his assistants and wanted to give an explanation as soon as possible.
"Okay, okay, everyone, let's take a rest!"
Seeing Liu Lang walking in, Professor Wilson waved his hand. He hadn't slept well in the past few days. He kept thinking every day, but there were too many factors and it was not easy to grasp the key points.
"Liu Lang, it's really "unlucky" for you to go to New York this time! It's a stock market crash that our country has never seen in decades. Everything in New York is in chaos!"
"Professor, things are indeed in chaos, and on the 16th, I was in the New York Stock Exchange!"
"What? Where are you? What are you doing?"
Wilson was startled.
"Nothing, just bought some futures!"
Liu Lang replied.
"Oh, you are really unlucky, but you are much better than those speculators!"
Professor Wilson expressed deep regret.
"No, I'm not unlucky, I'm so lucky because I made $90 million that day!"
Liu Lang replied.
"Ninety million US dollars... Are you the one with 500 points in stock index futures?"
Professor Wilson jumped up immediately.
"Yes, that's me...no, it should be said that it was the result of discussion between Lewis and I!"
Liu Lang pointed to Louis Wang who was standing aside and said.
"You? How is it possible...? Did you two predict this major stock market crash?"
"Yes, the result of our research is that a stock market crash will definitely happen, and it will be a big one!"
Liu Lang said categorically.
"You actually predicted this stock market crash! Why didn't you tell me earlier?"
Professor Wilson said with wide eyes.
"Haha, professor, if Louis told you five days ago that a major stock market crash that has not happened in decades would occur in the United States, would you believe it? Even if you believed it, the senior government officials would not believe it. Instead, they would probably think that we
It’s alarmism, isn’t it?”
Liu Lang smiled slightly and said.
"this………!"
Professor Wilson didn't say anything for a long time. As a leading figure in the economics field, he fully agreed with Liu Lang's words. He was right. Before the stock market crash happened, even he would not admit that the stock market crash would come to the United States. Even if the United States
The economic situation this year was somewhat bad. He also believed that it was just a trivial wave in the transformation of the economic structure and was not enough to cause such a strong stock market turmoil. However, the result was beyond everyone's expectation. The stock market crash really happened, and it was still
A disaster beyond imagination.
"Okay, then I want to hear, how did you expect such a strong stock market shock to occur?"
The key now is not to dwell on the stock market crash itself, but to identify the problem and prescribe the right remedy.
"You need to ask Louis about this. He gave me this opportunity to make money!"
"Louis, what's going on?"
Wilson looked at this shy Chinese young man.
Louis' face turned slightly red, not because of the other party's inquiry, but because Liu Lang was bragging too much. Liu Lang making so much money actually had nothing to do with him. He was very sure that even without him, Liu Lang would
He had already made up his mind to do the same thing. The reason why the other party did this was to give him a chance, a chance to show himself in front of Professor Wilson. This opportunity was really important to him.
King Louis glanced at Liu Lang. Liu Lang's smile was so sincere that it was hard to imagine that it was the smile of a six-year-old child.
"Professor, I have done some investigations on the country's economy in the past few months, and found some problems that are not visible on the surface. For example, the country's fiscal deficit and trade deficit have reached new highs this year. From the beginning of the year to now, the fiscal deficit has reached as high as
The trade deficit reached US$111 billion, with the trade deficit reaching US$60 billion, both setting record highs for deficits.
Such a high deficit requires the absorption of foreign funds to make up for the lack of domestic funds. In order to attract foreign investment, high interest rates must be maintained, which has a direct impact on stock market prices.
The real economic growth rate of the United States and other Western countries has slowed down since the 1980s. There is insufficient demand for productive investment and a large amount of surplus capital has poured into the securities market. This has directly led to rampant financial investment and unprecedented debt expansion, forming a false and unsustainable economy.
Prosperity, so I believe that the current stock market crash is a reflection of the "bubble economy".
In addition, the Western economic system and the entire world economy are in a state of instability. I cite this as the inevitable situation brought about by the adjustment of industrial structure. However, this change has caused international exchange rate turbulence, serious imbalances in international trade, and international debt crises.
Constantly, these factors have affected the stability of international funds and stock markets.
Therefore, the direct cause of the stock market crash was the increase in interest rates, which caused the interest rates on Treasury bills and other bonds to increase accordingly. Investors transferred funds from the stock market to invest in bonds, causing stock prices to plummet, the trade deficit to become too large, and the U.S. dollar exchange rate to fall, which shook people's understanding of the U.S. dollar and the U.S. dollar.
Confidence in the U.S. stock market.
For these reasons, I think the stock market crash is inevitable!"
King Louis expressed his thoughts.
There was his own judgment in this, but most of it was the conclusion given by Liu Lang, and he felt that Liu Lang's analysis was even more thorough. However, Liu Lang gave his results to King Louis in order to make him famous in one battle.