Chapter 11 Lecture 10 Who Sniped Vietnam

●Crisis breaks out and prosperity fades. I never dreamed that there would be a financial crisis in Vietnam today. ●Some people predict the crisis clearly. Some people may not get food, he said. ●There are predators behind the crisis. Through international inflation, Vietnam's inflation rate has reached an uncontrollable 25%. ●Really clever, they are too powerful. Who is manipulating behind the scenes, who sniped Vietnam? Vietnam has been hailed as the Asian economic miracle in the past five years, and many Chinese entrepreneurs have gone to Vietnam to set up factories.I never dreamed that there would be a financial crisis in Vietnam today.

Vietnam is located in the eastern part of the Indochina Peninsula, with a land area of ​​about 330,000 square kilometers and a population of 76.5 million. The economy is dominated by agriculture, among which rice is of high quality and high yield, and its annual export volume ranks third in the world.After many years of war, in 1986, Vietnam began to establish a development strategy of "innovation and opening up". The policy guidance made Vietnam attract foreign investment to show a rapid growth trend.At the same time that foreign capital is inflowing wildly, Vietnam's capital projects are also open, and 11 of its 12 service trade fields have been opened to the outside world, including communications, insurance, and banking.Excessive openness and relative lack of experience have laid hidden dangers for the rapid development of Vietnam's economy. Since March 2008, Vietnam’s economy has suffered a series of bad luck. The Vietnamese Dong has depreciated, the property market and stock market have fallen, there has been a rush to buy rice, and the inflation rate has risen to 25.2%. Vietnam has fallen into crisis.

How did this crisis come about?The crisis stemmed from uncontrollable inflation.The inflation rate in Vietnam is as high as 25%. That is to say, if you have 100 yuan and put it there without doing anything, your money will depreciate by 25%.And this inflation rate will continue to rise.We found that many Vietnamese have started to sell their national currency and lined up in the international market to buy euros and US dollars, and try to keep foreign currency as much as possible.But because of government restrictions and other reasons, when they could not buy foreign currency, this group of people changed from buying foreign currency to buying necessities of people's livelihood all over the country, including buying rice, mineral water and so on.Everything on the shelves you could imagine was wiped out.Why?Because the value of these items is relatively stable.

How do you understand it?If you measure it in Vietnamese currency, the price of these items has increased, but their actual value is there. Calculated in actual value, it is stable. A bag of rice is a bag of rice, and a bottle of mineral water is a bottle of mineral water. water.In order to maintain their purchasing power, ordinary people will rush to buy these goods before the currency depreciates sharply. Once they rush to buy, the problem will become more serious, which will cause the prices of these goods to rise sharply, and this price is set in Vietnamese currency.A sharp rise in prices will lead to more serious inflation, which will force people to buy more foreign exchange, sell their own currency, or rush to buy necessities for people's livelihood.Thus formed the unprecedented financial crisis in Vietnam.So, who caused this crisis?

I can tell you a new concept. 150 years ago, the national strategy of Western imperialism, you have all read in your history textbooks, was guided by the East India Company and backed by gunboats, forcing you to open the door.But today, today is guided by internationalization and backed by finance, and its purpose is the same.Compared with our China, Vietnam is relatively much more open, so in the past few years, a lot of hot money flowed into Vietnam, real estate speculation, property market bubble; stock speculation, stock market bubble; shopping, inflation.All the shocks basically come from international hot money.So who controls this international hot money?It is controlled by international financial speculators.On the surface, Vietnam seems to have experienced a certain degree of prosperity, but at the end of 2007 and 2008, when the international hot money was withdrawn, what happened?The price index is as high as 25%; due to the large inflow of international hot money, the stock market has soared five times in the past two years, but in the past six months, the market value has fallen by 70%; the price of high-end commercial housing has fallen by as much as 50%; Currency, the Vietnamese Dong may depreciate by 30% within a year.

We have learned the theory of supply and demand in economics textbooks. The teacher taught us that for any commodity, if the supply exceeds demand, the price will fall; if the supply exceeds demand, the price will rise.This theory of supply and demand has almost become the basis of our entire economics. Before 2007, this theory was correct, but after 2007, especially after June of 2008, everything became wrong. We entered an unprecedented new era.So where did inflation come from? It is generally believed that the inflation in Vietnam started in July 2007. In less than a year, the CPI soared from 7% to 25.3%, the highest in 13 years. The average monthly salary of residents in Ho Chi Minh City was only about 730. On the one hand, they bear the reputation of the world's rice producing area, but on the other hand, they have to buy nearly 4 yuan per catty of rice and more than 20 yuan per catty of pork. One can imagine the pressure of life.

The source of this inflation is international inflation.But who is manipulating it?I have collected a lot of data in the past few months to study this phenomenon, and it is necessary to communicate my research results with you.As I said earlier, we have always believed that supply and demand conditions determine prices, such as oversupply, prices fall; undersupply, prices rise.The reason seems simple, but in recent months, oil prices have risen sharply, food prices have risen sharply, and iron ore prices have skyrocketed. Do you think it is because of insufficient oil output, grain output, and iron ore supply?Or do you think it's a new international conspiracy?

Taking the middle of 2008 as an example, the daily oil consumption and supply in the world were about the same, with an average of about 87 million barrels. There was an obvious balance between supply and demand or a slight oversupply, but the price of oil soared from $70 a barrel to $147. a barrel. In 2008/2009, the world's total grain output was 2.16 billion tons, the total consumption was 2.15 billion tons, and the unfinished inventory at the end of the year was 340 million tons. This is an obvious slight oversupply, but the price of food has risen sharply. The international price of high-quality rice is five times that of China.In addition, the supply of international iron ore has never been short, but the price of international iron ore has soared by 76%, 19% and 95% every year since three years ago.These data show that the price changes of these bulk products can no longer be determined by the simple principle of supply and demand.Taking oil as an example, what Rogers said was very interesting. He said in November 2007 that the price of oil would rise to US$150 or even US$200 per barrel.His reason is simple, Asian economies continue to grow, so oil prices will rise.Very accurate estimate.How did he predict so accurately?In addition, on June 20, 2006, Rogers gave a speech at Peking University. He said that the supply of agricultural products has decreased and the demand for food has increased, so he believes that the bull market for agricultural products will continue.How could he predict so accurately?

In 2005, Rogers published a book called "Investing in Hot Commodities", which has been a best seller ever since.In this book, Rogers starts from the supply and demand of commodities, and believes that the continuous development of the Asian economy will bring about a strong growth in the demand for all commodities worldwide, which requires the consumption of a large amount of iron ore, copper, petroleum, soybeans and other raw materials. Hot commodities will see a 10+ year bull market.Many readers noticed in amazement that what Rogers said a few years ago is becoming a reality today. Is it because Rogers has a super predictive ability, or is there another mystery behind it?

From the price of oil, we can see that the price is no longer determined by supply and demand as taught in economics textbooks, but by international speculators.This is why the price of oil and food has risen sharply under the situation of oversupply.So recently I began to study the operation methods of international speculators. After the study, I slapped my thigh. These people are really tall, and they are so powerful.Where did they start?Start with rice.Think about it, why rice instead of wheat?Because relatively speaking, countries that eat rice are relatively poor, backward and ignorant.

Let's take the Philippines as an example. The Philippines is very poor. It does not produce rice itself and is a rice-importing country.After these international speculators have raised the price of rice, what will happen?As a result, countries such as the Philippines cannot afford rice, and the inevitable result of not being able to afford rice is that some people starve to death, and as long as people starve to death, the government will fall. Rice exporting countries like Vietnam or Thailand are reluctant to export when they see this situation.Why?Because once the price goes up and we can't afford rice, people will definitely starve to death.As long as people starve to death in a country, the government will inevitably fall.Therefore, as soon as rice prices rise sharply, rice exporting countries, such as Vietnam and Thailand, will immediately ban exports.Why?Because they are afraid, what if their own country does not have enough rice after selling it to others?If the people starve to death, the government will collapse.Therefore, when international speculators raised the price of rice, many rice exporting countries immediately blocked exports.What is the result of their blockade of exports?Prices go up faster, and countries like the Philippines can't afford it because it's already poor.then what should we do?The latter result must be that someone will starve to death.As a result, these countries are forced to sell their iron, begging grandpa to sue grandma, and get some money to go to the international market to buy rice at the highest price for their own people to eat. Everyone, please think about it, how do you do stocks?When you make a deal at a certain price, what price is this price?It is the market price.By the same token, as long as these poor countries buy rice at the highest price, this price becomes the market price.Therefore, by speculating on rice, international speculators have obtained pricing power that completely violates market supply and demand.We used to think that the reason why the price of rice went up was because we had more people and we needed to eat rice, so the price would go up.Why did the price of rice drop?Because we don't eat rice, there is too much supply, so the price of rice falls.Not anymore. What we learned in the economics class in the past, the model of supply and demand determining the price of rice, can no longer be used. Why?Because the real pricing power is now in the hands of international speculators.Starting from rice, they used the method of starving people to obtain the pricing power of rice.And I think "obtaining pricing power" is the highest strategic guideline for international financial speculators in 2008. So Rodgers made a statement in June 2008 that struck us as sensational, saying that some people might not be able to get food.How does he know?How does he know?Because this is the manipulation method of international speculators, through pawns like Rogers spreading rumors everywhere to create conditions for international financial speculators.In today's era, the pricing power of international bulk products is basically firmly in the hands of international financial speculators, and the reason why Vietnam has come to this day is because of its rapid internationalization. Since 2005, Rogers has talked about his theory of supply and demand on various occasions.He publicly stated that the grain stocks of countries all over the world are very low, and the world is now consuming more grain than it produces.If the weather is bad, it may happen that people cannot find food everywhere because there is no food at all.Rogers' remarks are not true in Professor Lang's view. If so, how are oil and grain prices in the international market manipulated and inflated? So how do they manipulate oil and food prices?through the futures market.The so-called futures market is very simple. It means that there is a future contract. For example, if I want to buy oil six months later, how can I buy it?You have to go to the futures market to buy it, which has its own price.In contrast, there is the spot market, what price is it to buy today.Have you all traded in stocks?When trading in stocks, if you bought this stock today, for example, the stock of ABC Company, how can you be sure that its price will rise?That is, after you buy it, you must ensure that someone will push up the stock price in the future, and it will only increase in price if there is demand.If no one buys, the price is likely to drop.Therefore, the factor behind your buying this stock today must be sure that someone will buy it. After you buy it, someone will speculate and someone will buy it.Therefore, the reason why you can make money in the stock market today is because after you buy this stock, there will be successors who will push up the stock price, so you can make money, it's as simple as that. These international speculators speculate on oil and grain, the principle is the same as we speculate on stocks.Let's think about it from their standpoint, they are going to speculate in oil and grain today, in the futures market.How can they make money?That is, after raising the price of oil and grain, we must be sure that someone will buy it in the future.What we buy, what price increases.For example, the price of iron ore, which has been making a lot of noise recently, has risen by 95%. After our Baosteel bought it, South Korea and Japan had to follow suit.Why?Because our demand is too large, as long as we buy, the price will definitely rise.The international speculators have seen this, so what do they do?They go ahead of us.So you see, the rise of such bulk materials, such as oil, to $140 a barrel is not due to insufficient supply, nor is it because our economy is developing too fast and we need oil. No, it is because international speculators have been speculating all the way up.Therefore, in the case of oversupply, oil prices did not fall but rose.In today's era, the pricing power of international bulk products has basically been firmly controlled by international financial speculators.And this explains a phenomenon, that is why oil exporting countries have no intention to increase production. At the beginning of July 2008, the international oil price broke through 145 US dollars per barrel, setting a record high again.In view of the impact of high oil prices on the economies of all countries, especially the poor countries in the world, the International Energy Agency has urged OPEC to stabilize oil prices by increasing production.But what is intriguing is that Khalil, the rotating chairman of OPEC, recently publicly stated that the current supply and demand balance in the international crude oil market means that there is no need for OPEC to increase production.The rise in oil prices is not the responsibility of OPEC. In 2007, OPEC had increased production, but oil prices still rose.At the same time, Rogers claimed that unless a large oil field is discovered, it is not surprising that the price of oil will rise much higher.What do these two inconsistencies indicate? I believe everyone has seen media reports that many countries require oil exporting countries, including Saudi Arabia and Kuwait, to produce more oil.But they say there is no need to increase oil production, why?They said that it is not our problem at all, because the market is already oversupplied.Think about it again, how high is the price of gasoline in Hong Kong now?The current No. 93 gasoline in the Mainland has been raised once, about 6 yuan. Do you know how high the gasoline price is in Hong Kong?It is about 20 yuan in RMB.Can you imagine?Under such high oil prices, demand has been greatly suppressed, and people don't want to consume at all.Why did the price rise instead of fall?International financial speculators are operating.In other words, the economics we have learned should be rewritten from 2008. How should we write it?That is, the prices of various products such as oil are determined by international financial speculators.How do they decide?according to their personal wishes.Supply and demand, that is the classical school, that is a matter of ancient times, at least after 2008, supply and demand cannot determine the price.We are in this situation today. This is what I told you before. It is different from 150 years ago. At that time, the East India Company was the leader and the gunboats were the backing. You can see all this.Today is different. Today, internationalization is the guide and finance is the backing. The reason why Vietnam has come to this point is because of the rapid internationalization. Vietnam's internationalization is faster than ours, what is the result in the end?International financial speculators let a large amount of hot money flow into Vietnam to speculate in stocks and real estate, driving up real estate prices and stock prices. Then, in line with international inflation, they withdrew a large amount of capital, causing property prices and stock prices to plummet.Who is at fault?Thanks to the common people in Vietnam, they returned home with full rewards.So how did they let property prices and stock prices plummet?Through international inflation, Vietnam's inflation rate has reached an uncontrollable 25%.The 25% inflation rate made the Vietnamese people panic and began to sell a large number of Vietnamese currency, which devalued the Vietnamese currency, so the people began to rush to buy various agricultural products and various daily necessities, so the price rose and the inflation worsened. At this time, international speculators have spotted it. Well, the crisis in Vietnam is coming, and Vietnam is finished.What did they do?They sold real estate at high prices, sold stocks at high prices, returned with a full load, and withdrew all their capital, leaving this mess to Vietnam.What is this?This is what I have repeatedly told you that Vietnam is experiencing an unprecedented financial disaster led by internationalization and backed by finance.So Vietnam was a failure. Audience: It is just over 10 years since the Asian financial turmoil. Will the Vietnamese financial turmoil turn into the second Asian financial turmoil?Is there any difference or connection between this financial turmoil and the last one?Will the financial turmoil in Vietnam expand this time? Lang Xianping: Who is the next target?There was a bestseller last year called, have you read it?Don't look at it, it's all wrong.If the level of international speculators is so low, then we should feel at ease.The scary thing about international speculators is that their tactics are different every time.Therefore, the method of attacking Japan, the 1997 financial turmoil in Asian countries, and the method of attacking Vietnam are all different.China is different from Vietnam. In Vietnam, it only relies on the inflow and outflow of capital. Once the capital enters, the price will be raised, and then it will be withdrawn to cause the stock market to crash. That is relatively simple.China is different, because China has a large demand and a large population, which makes these international speculators profitable in international bulk materials. As for what they will do next, frankly speaking, we don't know. Audience: I have an entrepreneur friend who has already invested and built a factory in Vietnam. When he went to Vietnam, he was interested in the labor force and resources there. But now that this happened in Vietnam, he himself is a native Entrepreneurs, ignorant of financial knowledge.In this case, should he get out of the way, or is there any chance? Lang Xianping: The current opportunity is an opportunity for financial warfare. If he does not understand finance, it is best not to seize this opportunity, because he will fail.You can tell your friend that leaving China for Vietnam is a mistake in itself.Because China is at least big enough that you still have room to maneuver.When you arrive in Vietnam, once you encounter a financial crisis, because it is too small, you have very little room for maneuver.What should we do if the price is so high and the cost is so high?This is a question, but where does the opportunity come from?Opportunities come from finance, and only when finance is done well can there be opportunities.If it's just a pure manufacturing industry, it will be difficult, and he is easily constrained by this environment.So why do entrepreneurs need a stable environment?It is for this reason.It is best if the exchange rate is also stable, the interest rate is also stable, and everything is stable, so that it is easier to develop.Once there are large fluctuations, it is the most difficult for entrepreneurs in the manufacturing industry.You know China very well, but do you know what will happen when you arrive in Vietnam?You don't know anything, what is the whole system risk in Vietnam, you can't figure it out, this is one of the biggest problems. Audience: Because he is a local entrepreneur after all, he just took a fancy to the factor of labor force that he valued before. Lang Xianping: This is wrong. He uses labor force as the selection criterion, which is inherently problematic.So he will pay the price for his wrong decision. The book is over!