My Age of Investment

Xia Jingxing suppressed the strongly fluctuating emotions in his heart and quickly calmed himself down.

Then he tentatively asked: "CDS products are relatively small, why do you want to invest in it?"

"Yes, compared to the public financial products such as securities and futures, CDS is indeed a bit niche, and it needs to pass the audit of the International Swaps and Derivatives Association to participate in the transaction. The higher transaction threshold directly puts retail investors and some small Institutions are isolated.

However, because of this, there are not so many eyes staring at this product.

Darren, do you think the rise in housing prices in the United States in recent years is normal? Even the part-time workers in my family have bought several houses. Is there any reason for this?

The part-time worker told me that she would work hard for another two years, and when the price of the house rose, she would sell the house and travel around the world, realizing her youthful dream.

I reckon that people all over the United States, regardless of whether they have money or not, have all come to speculate in real estate.

If this continues, the housing market will collapse sooner or later, the default rate of mortgage bonds will soar, and the price of CDS will likely usher in a surge. "

Xia Jingxing remained silent, which was exactly the same as his judgment.

However, this does not prove that the news was leaked, and it may be the conclusion drawn by others' own analysis.

After all, the world will never lack smart people, but people who can put ideas into action.

"Sounds very good, so why don't you just raise a new fund and buy it?"

The other end of the phone sighed, "Hey! Investing in CDS is not a small risk now. If the forecast is wrong and the housing market does not collapse, or the collapse is a few years later, it is really giving money to institutions that sell CDS."

Xia Jingxing didn't answer the call, and continued to talk to himself on the other end of the phone: "This possibility is quite high! Because in 2004, there were hedge funds that were pessimistic about the housing market and tried to sell short.

The results of it? Housing prices have been rising steadily, all short positions have been pulled, and a large number of hedge funds have fallen. "

"Um."

Xia Jingxing made a nasal sound and fell silent. He was thinking about the hedge fund liquidation in 2004.

Shorting the real estate market is not exclusive to Envision Capital, nor is it the first person to eat crabs. Some institutions that are not afraid of death have tried it two years ago.

Hedge funds are originally "desperadoes" who lick their blood at the knife's edge. They are looking for investment and speculative opportunities in the global financial market, so it is impossible not to pay attention to the housing market.

As a result, a large number of people died in the short housing market.

It has only been two years since this happened, and it is still fresh in the memory of many financial practitioners.

This is also an important reason why many institutions are pessimistic about the real estate market, but they dare not end it.

Xia Jingxing guessed that the man on the other end of the phone belonged to this category, he was ruthless but not daring.

Thinking of this, he finally felt relieved. It should not be that the news leaked, but that the other party had judged some market trends by himself.

But I was not very confident, so I wanted to seek some encouragement and listen to other people's opinions along the way.

"Daren, there's a lot of bubbles built up in the U.S. housing market, that's for sure.

What I'm not sure or worried about now is whether the federal government will intervene in the housing market in the event of a crisis? "

Xia Jingxing asked, "How do you say it?"

"For example, the legislation strictly prohibits residents' private land from entering the real estate market, developers implement a pre-sale certificate system, and it is strictly forbidden to lower the opening price at will;

Calling on migrant workers from Mexico to illegally enter the city to buy a house and get a green card if they buy a house;

Further reduce the down payment ratio, destock across the country, and encourage further leverage. If residents can't increase it, companies are encouraged to increase it.

Down payment is already zero?

Then, the tax credit for buying a house, the personal tax credit for a mortgage, and the income tax credit for a company buying a house are implemented.

You can also directly issue housing loan subsidies to defaulters. Anyway, it doesn’t cost a lot of money. If the federal budget has no money, it will further expand the deficit...”

Xia Jingxing laughed out loud when he heard this, it was too absurd.

At the same time he felt familiar.

Suddenly thought, isn't this the method used by the rabbit in 2015?

From 2015 to 2016, the round of national house price surges,

His memory is still fresh, and he sighs at the house!

"If one day I meet President Bush Jr., I will definitely recommend you to him as Treasury Secretary."

"Hahaha, Darren, I'm joking with you, I speculate that there is a possibility of the federal government intervening in the housing market, but it's not great.

Moreover, President Bush Jr. only sent 6,000 National Guards to the U.S.-Mexico border a few months ago to prevent the infiltration of more illegal immigrants. "

Xia Jingxing replied: "Yes, no one can predict the future direction of the housing market.

Why did you suddenly think of asking me this? I have been speculating in stocks, and I rarely touch other financial products. "

"Haha, we are both Chinese, so naturally we have to help each other! You returned to China last year, so I have less contact with you. I hope you won't be offended!"

Speaking of this, the other party suddenly switched to Chinese.

Ouch I go!

Xia Jingxing patted his thigh. He finally knew who was on the other end of the phone. Li Lu, Charlie Munger's apprentice, also owns a hedge fund company called Himalaya Capital.

He met Li Lu when he followed Gates to visit Buffett, and he was not very friendly. He was usually busy with work, so he didn't have much contact with each other.

He also did not expect that Li Lu would actually call him.

Thinking about it carefully, I don't think it's strange.

Wall Street, like Silicon Valley and Hollywood, also has a "transparent ceiling".

There are many Chinese working on Wall Street, but there are not many Chinese bosses who own their own hedge funds.

The scale of Vision Capital's hedge fund is unremarkable in the United States, but it is one of the best among Chinese Americans.

The size of Li Lu's hedge fund is not much different from that of Vision Capital. If you don't talk to him, you can't find other Chinese to talk to.

After thinking about these things, Xia Jingxing suddenly thought, is this a "bait" for Li Lu?

People brought CDS this product to exchange some opinions with him, but he concealed some facts, which was not frank enough.

But he told Li Lu everything, especially that he was going to short US$3 billion in the US housing market, would the other party follow suit?

This can easily disrupt his deployment.

After thinking about it, Xia Jingxing felt that he could only be a villain once, so he will not reveal it for the time being.

There is no way, Shang Hai is ruthless, and there is no big mistake in being careful.

"I think you can communicate with Mr. Charlie Munger and tell him everything you think.

He has been in the financial world for decades, and his knowledge is far stronger than ours. "

Li Lu sighed, "Hey, I have dinner with him every Tuesday, because he is the largest LP of Himalaya Capital and has taught me a lot, so I respect him a lot.

I have communicated with him a while ago, and he does not recommend going into the empty house market.

Because the old man, like Buffett, never agrees with short selling.

The old man’s original words are as follows: the collapse of the real estate market will eventually be paid by the government, and the money earned by shorting CDS is essentially taxpayer’s money.

After hearing what he said, my idea of ​​entering the CDS market on a large scale has faded a lot. "

Xia Jingxing smiled, and Buffett said the same thing: Remember, never short your motherland!

He agrees with Buffett's words, but his motherland is China, and he has no psychological burden for shorting the United States.

And Buffett also said that instead of buying technology stocks, he later bought Apple stocks and made tens of billions of dollars.

No one can escape the law of true fragrance!

If you really believe the words of these bad old men, you are destined to only work part-time in this life.

"Brother Li, I have a word for you."

Li Lu was silent on the other end of the phone for a few seconds, and said in a low voice, "Okay."

"The Doctrine of the Mean gives us the direction to maintain independent thinking in terms of erudition, interrogation, prudence, discernment, and earnest practice."

After listening, Li Lu was silent for half a minute, "You mean I should stick to my own opinion?"

"I can't say this well, it does not constitute any investment advice, thank you for your cooperation! Hahaha~"

Xia Jingxing changed the topic with a smile. He still gave Li Lu some hints, but if the other party was at ease in being Charlie Munger's heir for the rest of his life, he would definitely not dare to take the risk of disobeying his master.

In fact, this road is not bad. An Anxin will take over the old man's family fund, and in the future, he will be able to walk in the rivers and lakes under the old man's name.

But if you want to become a generation of investment emperors, you must find your own path.

"Okay, thank you Darren, you are welcome to come to Omaha anytime, and I will treat you to a drink."

Xia Jingxing could sense the other party's sincere invitation, and replied with a smile, "Okay, come if you have the chance."

...

PS: I recommend a book, "The Calamity of Ten Thousand Clans: The Difficulty of Calamity", the author Dancing Pencil is also the chief operating officer of this book, and he wrote the same humanities of the Calamity of Ten Thousand Clans. Interested book lovers can go and read it.