Golden Spoon Investment Portfolio - Chapter 324

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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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324. No. This is just the beginning.

March 11, 1997, Bangkok, Thailand.
The International Department Office of the Bank of Thailand resembled a war zone, with telephones ringing incessantly from every corner and foreign exchange officers shouting frantically.

Ring! Ring!
“Thirty—no, fifty boats at 5.9!”
“Siam Commercial Bank’s foreign exchange account has been depleted!”
“We just replenished it an hour ago.”
“They’ve already spent it all, sir.”

Damthatuey, the head of the foreign exchange center with a furrowed brow, turned to glance at his subordinate beside him and asked sharply.

“How much foreign currency do we have left?”

The employee responded with a grim expression.

“Only 230 million dollars, sir.”
“What? It’s already depleted that much?”
“The volume of baht sales is so massive that our foreign reserves are being consumed rapidly.”
“Damn it!”

Damthatuey spat out a harsh curse and pressed urgently.

“How much longer do you think we can hold out at this rate?”

The employee answered with an uncomfortable expression.

“At this pace, the account will likely be depleted before market close.”
“Ugh.”

Damthatuey let out a groan and pressed his throbbing temple.

“Transfer 100 million dollars to Siam Commercial Bank for now, and report directly to me if the balance drops below 50 million.”
“Understood, sir.”

Damthatuey, the head of the Foreign Exchange Center, observed the foreign exchange market situation displayed across six monitors before him—a sea of baht selling—and bit down hard on his lower lip.
He quickly reached for the telephone receiver to request additional authorization for foreign exchange usage.
This was already the second request for additional approval in a single day.
This alone was evidence of how fiercely the battle against the hedge funds was raging, and as his foreign exchange reserves dwindled rapidly, cold sweat beaded on Damthatuey’s spine.
No matter how much money he scraped together, he could find no confidence that he could possibly withstand that relentless barrage of selling pressure—a volume so overwhelming that no other word could describe it.

“Damn it.”

Damthatuey, the head of the Foreign Exchange Center, glared at the monitors while gripping the telephone receiver so tightly it seemed he might crush it.

***

The next day.
As if reflecting Thailand’s desperate crisis, dark clouds hung heavy in the sky above the front gate of Chitralada Palace, the royal residence, where numerous domestic and foreign journalists had gathered.
They were there to interview Prime Minister Chavalit Yongchaiyudh, who had come to the palace for an audience with the King.
After some time had passed, rain suddenly began pouring down from the sky.
As the murmur of journalists grew louder, the iron gates that had been firmly closed swung open, and Prime Minister Chavalit Yongchaiyudh, dressed in formal attire, appeared alongside a secretary holding an open umbrella.
The assembled journalists then rushed forward, surrounding Prime Minister Chavalit Yongchaiyudh in a circle, thrusting cameras and microphones forward as they bombarded him with questions.

“The exchange rate continues to show unstable movements. Would you please share your thoughts on this matter?”
“What conversation did you have during today’s audience?”
“There are opinions that the baht should be devalued given Thailand’s economic situation. What do you think about that?”

Prime Minister Chavalit Yongchaiyudh, standing with a stiffened expression amid the barrage of flashing cameras from all directions, opened his mouth with a firm tone as he looked toward the broadcast camera before him.

“As I have stated before, the attacks on the baht are the result of the despicable schemes of greedy currency speculators seeking to plunder the wealth that the Thai people have painstakingly accumulated over many years. My cabinet and I are standing firm against these speculators’ attacks, and we will never retreat.”

Then a blonde female reporter holding a microphone bearing the CNBC logo called out loudly.

“Does that mean there will be no devaluation of the baht?”
“Of course not. If we devalue the baht according to what the speculators want, Thailand will become impoverished. I say once more at this moment: we will absolutely not change the current exchange rate policy we are pursuing.”
“But it is known that Thailand’s foreign exchange reserves are quite limited. Is it really possible to defend the exchange rate?”
“The Bank of England and Japan both capitulated to the attacks of the hedge funds. Do you really believe Thailand can endure?”
“Prime Minister!”

The journalists swarmed like bees, pouring out their questions, but Prime Minister Chavalit Yongchaiyudh offered no further answers and moved forward.
Following the path opened by the palace guards, he climbed into the rear seat of the waiting official vehicle and departed immediately.

***

[… As you can see, Prime Minister Chavalit Yongchaiyudh displayed strong confidence in defending the baht. However, massive sell orders continued to flood the foreign exchange market, and the baht remained under pressure. Meanwhile, Thailand’s stock market also failed to escape its downward trend….]

Seok-won picked up the remote and turned off the television, which was broadcasting news about the baht. Landon Shore, seated on the left side of the sofa, spoke with a relaxed demeanor.

“The fact that he’s saying such things suggests they still don’t fully grasp the situation.”

Seok-won responded while sitting with one leg crossed.

“Even if they recognize how precarious things are, they can’t simply say it outright, can they?”

Andrew, who was present, nodded in agreement.

“The moment they acknowledge the crisis, not just the stock market but the entire nation would fall into panic.”
“Exactly. With anxiety already running so high, they can’t throw a bomb on top of that.”

Landon Shore shrugged as he spoke.

“But with their foreign exchange reserves nearly depleted, they’ll be forced to surrender within days.”

Seok-won took a sip of coffee, set down his cup, and turned his gaze toward Andrew.

“You said the central banks of Hong Kong and the other two countries have now completely stopped buying baht?”
“That’s correct. Singapore and Malaysia withdrew long ago, and even Hong Kong, which held out the longest, has stopped purchasing baht as of today, apparently unable to sustain the effort any longer.”

Leaning back against the plush sofa, Seok-won asked calmly.

“How much longer do you think Thailand can hold out?”
“At the current rate of foreign exchange depletion, they’ll struggle to last more than four or five days at most.”

Seok-won nodded in agreement, sharing the same assessment.

“Then everything should be finished by next week at the latest.”

Seok-won shook his head with a serious expression in response to Landon Shore’s remark.

“No. This is just the beginning.”
“What?”

The two men looked at Seok-won with puzzled expressions.

“What do you mean by that?”

I responded to Landon Shore’s question with a calm, measured tone.

“What do you think will happen if the Thai government raises the white flag, surrenders, and lifts the currency band restrictions?”
“Well, the baht, which has been constrained by the limits until now, will plummet sharply, and the hedge funds that have taken short positions will reap enormous profits.”
“That’s the default outcome, but the shockwave from the baht’s devaluation won’t stop in Thailand—it will spread rapidly to the neighboring Southeast Asian countries.”

The two of them stared at me with startled eyes, apparently not having considered that far, as I continued.

“Won’t anxiety spread that Malaysia, the Philippines, Indonesia, and other Southeast Asian nations with similar economic models—which have also enjoyed booms over the past few years and are equally bloated with bubbles—could face crises just like Thailand?”
“…!”
“And if exchange rates become unstable as a result, the hedge funds that have already made substantial gains in Thailand won’t simply let that opportunity slip away.”

Only then did Landon Shore, grasping the full implication, let out a low exclamation.

“In the case of Hong Kong, Singapore, and Malaysia, they’ve become vulnerable after spending considerable sums of dollars to aid Thailand. They could become far easier prey.”
“And if another Southeast Asian nation collapses following Thailand, the anxiety will amplify even further, and as hot money investors withdraw their capital, all of Southeast Asia will be sucked into the vortex of a foreign exchange crisis.”
“Nothing spreads as quickly as fear.”

Landon Shore nodded in agreement, his expression grave.

“When that happens, the hedge funds will swarm like ravenous locusts, moving from place to place and shaking the Southeast Asian nations to their core.”
“If things unfold as you describe, we’ll be looking at a truly unprecedented scale of opportunity.”

Andrew’s eyes gleamed with excitement.
Even Thailand alone promised staggering profits, but the prospect of fleecing the entire Southeast Asian region was almost beyond imagination.

‘And with a decade of prosperity behind them, all these nations are bloated with wealth. The temptation will be irresistible.’

I leaned back in my seat, observing the two men absorbed in the discussion.

“When this game concludes, all the hedge funds involved will likely achieve their best returns ever.”
“If the crisis spreads across all of Southeast Asia as you’ve described, that will certainly be the case.”

Andrew, following Landon Shore’s lead, clicked his tongue in admiration.

“I thought when you mentioned a major opportunity was coming, you were referring to Thailand alone. Now I see you were envisioning something far grander. Truly impressive.”

At their sincere praise, Seok-won chuckled softly before composing himself once more.

“The Philippines and Malaysia are likely to be next. Let’s prepare accordingly in advance.”

Andrew tilted his head and asked.

“Malaysia has depleted much of its foreign reserves defending the baht, so I understand that case. But the Philippines is already under IMF oversight with no bubbles in real estate or the economy. Are you saying it will become a target?”

Seok-won nodded at Andrew’s puzzled expression.

“Yes. As you correctly pointed out, the Philippines is pursuing conservative economic policies due to IMF influence, but its current account deficit is approaching 8% of GDP, meaning it carries substantial external debt. However, just like Thailand, it maintains a band system while effectively implementing a fixed exchange rate regime—so wouldn’t that make it sufficiently vulnerable to attack?”

Andrew pondered for a moment before his expression shifted to understanding.

“Now that you explain it, I see your point.”

Seok-won picked up his teacup again, took a sip of coffee, and set it down.

“This operation won’t be a short sprint but a prolonged campaign extending through year-end. Let’s establish the New York Headquarters as our command center, with the Tokyo and Hong Kong offices dividing responsibilities so we can respond efficiently to the foreign exchange markets operating 24 hours without pause.”
“Understood. I’ll proceed as you’ve instructed.”

As Andrew acknowledged, Landon Shore rubbed his palms together beside him, his expression brimming with anticipation.

“We’ve already made 3.1 billion dollars through CDS option contracts and baht long betting, and this is just the beginning. I’m already excited thinking about what our profit margin will be by year-end.”

Watching him chuckle with his shoulders bouncing, Andrew’s lips curled into a slight smile as well.

“I feel the same way.”

Observing the two of them, Seok-won allowed himself a faint smile.

“We won’t know the final results until they materialize, but we’ll earn far more than all the profits we’ve accumulated over the past several years combined.”

Speaking with such certainty, Landon Shore’s expression brightened with delight.

“Heh. Just thinking about it sends a thrill down my spine. So you’ll ensure our bonuses match accordingly, yes?”
“Don’t worry. Just promise me that after receiving your bonuses, you won’t start saying you’ve earned enough and want to retire.”

Seok-won responded with a laugh, matching his playful tone with his own jest.

“Haha. There’s no way that would happen. I’ll stick by your side until you tell me to leave, so don’t worry about that.”
“Same here. Where else could I find such an exhilarating gamble if not by the boss’s side?”

Seok-won smiled contentedly at the sight of his two utterly dependable companions.

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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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