Golden Spoon Investment Portfolio - Chapter 12

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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12. Black Wednesday

Manhattan, New York, USA.
Salomon Brothers headquarters trading floor.
Cox set down the receiver he’d been holding, seated at a desk surrounded by four computer monitors.
As he lifted his gaze to the monitor before him, even during the brief call, pound sterling sell orders had been pouring in like a broken dam, continuing to accumulate relentlessly.
The foreign exchange traders nearby grew excited by the pound’s violent fluctuations, their voices rising in pitch.

“It’s dropped to 1.3800 dollars again!”
“Goldman Sachs is starting to dump pounds in massive volumes.”
“How much is this altogether!”
“Isn’t this dangerous?”
“Even if it’s become an aging lion, it’s still Britain—surely it won’t collapse.”

A dark-haired trader immediately countered his colleague’s remark.

“With this much selling pressure, what can the Bank of England possibly do?”

The other traders nodded in agreement with the sentiment.
Indeed, the current situation made it clear to anyone that the Bank of England would struggle to hold the line.
It was a testament to how fierce the assault from the Global Hedge Funds led by George Hamilton had become.
Sensing the relentless selling offensive as though it were a fight to the finish, the traders instinctively detected that today would be the inflection point that decided victory or defeat.
Without hesitation, they scrambled to grab their receivers and join in the pound selling frenzy.
Cox was no exception.

“Sell 400 million dollars at market price—pound futures and spot!”

Beyond the orders placed by Seokwon, I dumped every position I held and sold pounds.
This atmosphere spread beyond Wall Street to investors across the globe, and the pound selling became a massive tsunami that crashed over the Bank of England.

* * *

Bank of England Headquarters Dealing Room, London.
About a dozen foreign exchange dealers sat at their stations, desperately gripping computers and telephones as they fought to defend against the pound’s collapse.

Ring! Ring!

“380 boats, eight hundred million pounds!”
“Done!”
“375 ten million pounds!”

Mere seconds after purchasing the eight hundred million pounds, another massive sell order materialized. Tim, the department director in charge, couldn’t help but let out a low groan.

“Ugh.”

Following the plan approved by Treasury Minister Henry the previous day, we had purchased a staggering 600 million pounds twice before the foreign exchange market even opened—yet here we were in this dire situation. It cut deeper because of that futility.
No matter how much money we poured in, it had absolutely no effect against the relentless selling by George Hamilton and the other Global Hedge Funds.
I felt as helpless as someone aboard a shipwreck in the vast ocean, desperately scooping out the surging seawater with their bare palms.

“What’s the movement looking like?”

The chief dealer, who had been studying the Bloomberg terminal at the front desk, turned around.
He looked back at Tim standing behind him and shook his head grimly.

“The sell volume isn’t decreasing—it’s only growing as time passes.”
“Damn it.”

Though I desperately wanted to deny it, I instinctively recognized that hope was gone. I squeezed my eyes shut.
After standing there in anguish for a moment, I hesitated briefly before walking to a nearby desk, picking up the receiver, and calling Arthur.
The line connected, and Arthur’s voice came through shortly after.

[Hello.]
“It’s me, Governor.”
[I hear the situation isn’t looking good.]

I forced out words that barely wanted to come.

“…I’m sorry. I don’t think we can hold on much longer.”

Arthur fell silent for a moment, then spoke in a heavy, subdued voice.

[Is it really that difficult?]
“We’ve spent an additional 400 million pounds beyond the planned 600 million, but the exchange rate shows no signs of recovery and continues to fall.”
[…]
“If this continues, it won’t be an ERM issue—it will be a full-blown currency crisis that could shake the very foundations of Britain’s economy.”

Even at this very moment, Tim was rapidly depleting the foreign currency reserves to purchase pounds sterling, which faced inevitable devaluation in real time—making his concerns far more than mere worry.
Arthur, too, recognized the gravity of the situation and, abandoning further resistance, spoke plainly.

[Understood. I’ll contact the Prime Minister and the Chancellor of the Exchequer to discuss this. In the meantime, do everything you can to prevent the situation from deteriorating further.]
“I can’t guarantee success, but I’ll do my absolute best.”

After hanging up the phone, Tim exhaled deeply.
Watching the computer monitor display an overwhelming accumulation of pound sterling sell orders, he sensed that today would be an extraordinarily long and agonizing ordeal.

* * *

Cambridge, Massachusetts.
Sitting at an outdoor table, Seokwon glanced at his wristwatch and saw it had just passed 8:15 in the morning.

“Sigh. Without real-time exchange rate data, this is truly frustrating.”

In the era where I originally lived, I could check exchange rate fluctuations almost in real time through HTS systems, mobile trading platforms, or even internet portals.

“Now, let alone smartphones, the internet isn’t even readily accessible. It’s incredibly inconvenient.”

While not quite an addiction, having lived in an age where smartphones could handle virtually everything, their absence left me feeling suffocated and utterly helpless.

“But I can’t exactly manufacture a smartphone myself.”

Even with ideas and capital, the technology to implement them simply didn’t exist yet.

“I’ll make sure to buy Apple stock later, without fail.”

Apple, once formidable enough to challenge IBM’s dominance, now struggled with deteriorating operations and mounting losses.
In a desperate bid to reverse course, the company had even taken the drastic measure of expelling its founder Steve Nolan, yet the situation only worsened and the decline accelerated.
Everyone dismissed it as hopeless, treating Apple as a company that wouldn’t survive more than a few years before bankruptcy, and the stock market had turned its back on it entirely.

“If I told anyone that this Apple would resurrect and become the most expensive company in the world, they’d think I’d lost my mind.”

But for me, who possessed knowledge of the future, this moment represented a golden opportunity to acquire the goose that laid golden eggs at bargain prices.

“This must be the privilege granted to someone like me who’s returned to the past.”

I chuckled softly to myself, muttering the thought, then exhaled quietly.

“Ugh, seriously! This is driving me crazy. Next time, I’ll have to set up an office in New York so I can monitor market conditions in real time.”

Regardless, if I wanted to continue serious investments after multiplying my capital this time, I needed to establish an office and secure capable personnel to assist me.
While entertaining these various thoughts, I took a sip of the Americano I’d bought as soon as the café opened, and my phone on the table suddenly rang.

“Hello.”

The moment I answered, Cox’s voice came through the line, brimming with excitement.

[The Bank of England just raised interest rates by an additional 3%!]

Upon hearing this news, I gripped my phone tightly.

[Including the increase from three hours ago, interest rates have risen 5% in a single day.]

British interest rates had been 10% until yesterday, so now they stood at 15%.
It was essentially the Bank of England’s white flag of surrender in the face of the pound’s collapse.
Though I’d anticipated this outcome, my heart raced wildly now that it had become reality.
I suppressed the urge to leap about in excitement and asked calmly instead.

“What’s the market sentiment like?”
[The moment the additional rate hike was announced, selling pressure on the pound intensified. The pound-dollar exchange rate has broken through to 1.3600 dollars, and at this rate, even 1.3600 dollars will be vulnerable.]
“It seems the rate increase has only added fuel to the fire.”
[With George Hamilton and the hedge funds attacking, and the Bank of England appearing to surrender, even investors who were hesitant until now are rushing in.]

Having regained my composure, I responded matter-of-factly.

“Everyone would think it foolish to merely watch when such an appetizing feast has been laid out, even if it’s late to join in.”
[Haha, exactly.]
“Britain might even declare surrender before the day is through.”
[I believe so as well.]

Cox agreed with my assessment and spoke with evident satisfaction.

[Though it’s a bit premature, congratulations on hitting the jackpot.]

I smiled faintly, phone still pressed to my ear.

“Let’s save the celebration for after the investment is fully wrapped up.”
[Understood. I should prepare some top-tier champagne.]

* * *

10 Downing Street, London.
The Prime Minister’s office, adorned with antique artworks in classical elegance, was suffused with a heavy, oppressive atmosphere.
Over the past several days, despite pouring vast sums into the market and raising interest rates as a last resort, the pound’s collapse showed no signs of abating—a natural reflection of the dire situation.
Henry, the Treasury Minister, spoke first with a gloomy expression as he observed Isaac, the Prime Minister, seated in the center position, impeccably dressed in a navy suit and striped tie.

“As you’ve surely been briefed, the pound continues its downward spiral despite the additional rate cuts.”

Isaac, the Prime Minister, responded with a low, heavy sigh laden with anxiety.
The other cabinet members seated on either side of the sofa exchanged dark glances with one another.
Regardless of how diminished Britain’s standing had become, the fact that the once-proud British Empire was crumbling helplessly under the assault of mere hedge funds was both bewildering and utterly humiliating.
Isaac, in particular, bore the weight of this mortification all the more keenly, as he was the architect who had brought Britain into the ERM.
If they were to capitulate to the hedge funds’ onslaught, it would amount to a public admission that his policy had been fundamentally flawed.
Such an outcome would not only shatter his credibility but could potentially trigger a cabinet collapse.

“What if we inject additional funds to defend the pound?”

At Isaac’s attempt to preserve the ERM by any means necessary, Henry, the Treasury Minister, shook his head in skeptical disapproval.

“We’ve already expended over a billion pounds in foreign exchange today alone, to no avail.”

Arthur, the Bank of England Governor, who had been sitting with a stern expression, added in a despondent voice.

“Over the past several days, we’ve depleted a quarter of our foreign exchange reserves defending against the hedge funds’ offensive.”
“…!”
“If our foreign exchange reserves diminish further, this will transcend the ERM crisis and spiral into something far more catastrophic.”

The Home Secretary across the table narrowed his brow and posed a question.

“A catastrophe of that magnitude—surely you don’t mean we might have to seek assistance from the International Monetary Fund?”

All eyes in the conference room, including those of the Home Secretary, converged upon Arthur, the Bank of England Governor.

“That is correct.”

Arthur nodded heavily, and the Home Secretary’s face registered profound shock.

“How could this possibly….”

The other attendees, unable to conceal their dismay, let out sighs of despair.

“We need International Monetary Fund assistance….”
“Good heavens. This is a disgrace to our Great Britain! It cannot be allowed.”
“Alas….”
“Even so, this is unacceptable!”
“How did matters deteriorate to such a state….”

As turmoil rippled through the cabinet members, Prime Minister Isaac’s face hardened into stone.
Treasury Secretary Henry surveyed the room and spoke with grave solemnity.

“Even as we speak, the foreign exchange reserves painstakingly accumulated by British taxpayers are slipping helplessly into the pockets of Global Hedge Funds.”
“….”
“Dire and humiliating as it is, with interest rate increases no longer effective, the only remaining option is withdrawal from the ERM.”

As Treasury Secretary Henry urged the decision with an aching heart, Prime Minister Isaac sat upon the sofa with his eyes squeezed shut.
A terrible silence descended, and all the cabinet members present waited only for Prime Minister Isaac’s decision.
After that prolonged agony, Prime Minister Isaac finally steeled himself and spoke in a hoarse voice.

“To leave my name in history for such a matter… Very well. Cease currency defense operations and prepare a statement for release.”

At that, Treasury Secretary Henry and Arthur, who had been watching in tension, both exhaled sighs of relief simultaneously.

“A difficult decision, sir.”
“A wise judgment, sir.”

Though humiliating, they had at least avoided the worst outcome, and the other attendees bore expressions of cautious relief.
Observing this, Prime Minister Isaac, his face bitter, turned toward the Chief Secretary seated to his left.

“Before the official announcement, I’ll need to give advance notice to the Prime Ministers of France and Germany. Connect me by telephone.”
“Yes, sir.”

As Prime Minister Isaac announced the ERM withdrawal, he instinctively sensed that his political career would also end, and gazed upward at the ceiling with a hollow expression.

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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