“Miss, but why did CL lose so much? I an, they took a $1 billion hit from that movie studio acquisition, but if that was all, I don’t think they would’ve collapsed this badly. The report says real estate was the main cause...”
Seo Ji-yeon, suddenly struck by a fundantal question, asked . Despite having caught a cold, her academic drive was unshaken—she had no intention of stopping her studies.
“Mm, a bunch of misfortunes stacked on top of the investnt failure... Low regulation is nice when you’re investing, but when the economy turns bad, it becos a problem. Everyone could see the risk of collapse, but they still pushed in for so profit and got slamd.”
To put it simply, think of it like a ban on leverage.
In a bull market, no one understands why they shouldn’t use leverage because they can double their profit using borrowed money. But once the market drops and forced liquidation hits, they realize—
Ah, so that’s why everyone warns against leverage.
That’s why financial markets need basic regulations. If left unchecked, these finance-crazed suit-wearers will sell things they’re not even allowed to touch.
“...Then why did the downturn happen? It didn’t seem like it was just because prices had risen too much.”
“Because interest rates went up. When rates rise, the economy contracts. When they fall, it expands. That’s the basic idea. And while France wasn’t as bad as Britain, it had high unemploynt and weak economic performance.”
“...?”
Seo Ji-yeon tilted her head, clearly not following.
“Why?”
“If the economy’s bad, shouldn’t they lower interest rates? You just said lower rates stimulate the economy.”
“That’s how it’s supposed to be. But we attacked the ERM. If France lowers interest rates now, capital flows out into the Deutsche Mark and the exchange rate gets wrecked.”
The web of economics is so interconnected, there's not a single strand that doesn’t touch another. This ti was no different.
“Ah.”
Seo Ji-yeon nodded, finally understanding.
“You got it?”
“So it’s all because of you, Miss.... Then why did you even feel guilty?”
Hey, even if it wasn’t , Uncle Soros would’ve attacked anyway. This was always going to happen.
And it’s not like I didn’t leave a clue. If you looked carefully at Alpha Fund’s investnts, you’d see short-selling of real estate derivatives.
Anyway.
France’s real estate market, which had bood through the '80s, was now crashing in real ti. I was planning to inflate real estate prices—but only briefly.
“What I’ll do here is make it look like property prices are falling due to governnt regulations. That’ll create public opinion saying the governnt shouldn’t have interfered with CL’s losses.”
People always romanticize the path they didn’t take, which leads them to make poor decisions later.
“Ah, so you’re saying you’ll artificially raise property prices, then slam them back down just when the French governnt steps in? Hmm, but how?”
She really understands quickly. That’s nice.
I smiled and gently patted her head.
“Just lower interest rates. Hedge funds took their final swing at the franc and got destroyed, right? So that ans France’s exchange rate problems are stabilized now... and it’s the perfect ti to introduce low interest rate policies.”
Though even saying that, there’s still one massive issue left.
Inflation.
Lower interest rates worsen inflation.
Solving that is really, really hard. Naturally. That’s basically every central bank’s dream scenario.
Low inflation, high growth. If you solve all the problems I just ntioned, you get what’s called a Goldilocks economy—an ideal state.
“How are you going to solve it?”
Bright-eyed Seo Ji-yeon looked at , but... I had so bad news.
I wasn’t planning to solve it. I’d just pretend.
“If I contact Si-hyun, who’s holding down the Russian commodities market, we can suppress inflation temporarily. They’ve been trying to enter the European market anyway, so it works out. And if it helps control inflation, European governnts will be willing to tolerate letting in a bit of bankrupt Russia.”
The simplest way to stop inflation:
Have companies sell goods at a loss.
***
France is classified as a heavily regulated financial country.
That is... by 21st-century standards.
“How’s the French real estate market now? Do you think investor sentint is completely frozen... or is it just a temporary slump?”
Yoo Seon-jun, who had taken my plan and gone on a short trip to France, tilted his head.
“...Hmm, I saw a lot of real estate agents going out of business. But when I said I ca to buy property in Paris, they were thrilled. Thanks to that, I bought cheap.”
So that ans things aren’t too bad yet. At least they still have enough energy to scream.
I smiled and handed him a key.
“It’s part of the slush fund I stored in a Swiss bank. Go collect the money, and let’s do so shopping in Paris real estate.”
When demand increases, prices rise. It was a shady tactic, but with a low interest rate policy just around the corner, no one would look at us strangely.
With property prices in a deep slump and the environnt ripe for lower interest rates, buying real estate would seem like the most natural move.
Plenty of others would buy too. I was just fanning the flas a bit.
“Didn’t you say we should short it before...? Ah, you’re planning to raise it and then drop it?”
“Yep. Found a juicy target. I also told Alpha Fund to delay the plan a bit. If we profit on the way up and then again on the way down, that’s perfect, right?”
When market volatility spikes, smart institutions with early intel can profit from both sides.
Retail investors could try, but... most of them jump in thinking they can follow the trend, then miss the timing and get torn apart. Even institutions lose in volatility like this.
But ? I am the one manipulating the market—so it’s easy.
‘Ah... making money is so easy.’
A thrilling rush swept down my spine, like I was controlling the world itself.
This kind of thing would be unthinkable in the 21st century. Foreigners can’t even buy this much property anymore. Even using a fake identity would get caught instantly, and manipulating inflation like this would be laughable.
Unless you're, like, the President of the United States doing sothing openly insane, no one person can move global markets in the 21st century.
But now? Now I could. That’s the beauty of the 20th century.
.
.
.
Was this the first ti I’d tried to directly manipulate a nation’s economy?
Maybe that’s why I made a few mistakes and ran into one unexpected variable.
I wasn’t the only one predicting low interest rates. Columns about rising Paris property prices started appearing in the newspapers, and a few analysts were shouting that Russian commodity exports would soon lead to rate cuts.
That stirred up exchange rates again.
“...The franc-mark exchange rate is getting unstable. If this keeps up, interest rates will go up again. What should we do?”
Sigh. No choice, huh?
I loosened the tight button on my dress shirt and took a sip of coffee.
–Click.
“Use BBB to drop a news bomb in Germany. If we can’t rescue the French economy, we can just sink the German one a little. It’ll only be for a mont, so no risk of getting caught. Just detonate one of the bombs we planted in East Germany and things should settle down.”
Buying a bank really was the right move.
Being able to move a major European bank is a huge advantage.
The money is one thing, but the real power is trust. Alpha Fund doesn’t have the legacy, tradition, or European influence that cos with this bank. That stuff can’t be bought.
“Understood. I’ll contact Young Master Yoo Seon-jun right away.”
I watched the value of the franc bounce back after ⊛ Nоvеlιght ⊛ (Read the full story) the news of a German financial scandal, and smiled warmly.
It wasn’t that the franc rose—it was that the Deutsche Mark dropped. But that alone was enough.
France’s central bank isn’t completely incompetent. If I spoon-fed them this much, they should be able to manage from here.
And two weeks later—
The French central bank announced a base rate cut.
***
anwhile, in a mansion sowhere in France—
“Ahaha! We’re saved! Whew, Vive la France!”
With a wide smile on his face, one of Crédit Lyonnais’ directors clenched his fists in celebration.
[Inflation falls, French central bank announces interest rate cut...]
[Paris real estate prices skyrocket... Was the slump only temporary?]
Letting out a sigh of relief, he composed himself. After all the bribes they’d handed out, the mont the public’s attention turned, the governnt had started cracking down on Crédit Lyonnais without rcy.
They were barely holding on—but at this rate, everything might eventually be exposed.
There could be no more mistakes. Maybe God really was watching over France, since both inflation and the exchange rate problems had miraculously resolved.
“Yeah, we’re alive now. With Paris real estate prices up, we can reprice everything and shrink the losses on paper.”
—“But... don’t we still have so left? There’s probably about another $1 billion in losses. Actually, who even knows if it’s $1 billion? Does anyone here know the exact number?”
Of course not. If you record losses, they get discovered too easily.
Sure, if you organize the books well, it’s probably in there sowhere. But that’s for the governnt to deal with...
Right now, plugging the hole was all that mattered.
“....”
Swallowing hard, he turned to another director and proposed:
“How about we take a gamble now? We just entered a Goldilocks economy—there’s a good chance the bull market lasts at least five more years. Let’s increase our real estate investnt.”
Objectively speaking, it wasn’t a very good idea.
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