The joy after returning gradually fades over time.

The downward pressure on the economy has once again forced citizens to face the difficult situation, and the call for the Hong Kong government to improve the economy as soon as possible is getting higher and higher.

In order to survive this economic crisis and restore Hong Kong's economy to its vitality, the Hong Kong government also held many symposiums and invited knowledgeable people from all walks of life in Hong Kong to offer suggestions.

Xia Tian is the richest man in Hong Kong and a pro-Mainland patriotic businessman. He has a certain influence in both the political and business circles of Hong Kong, so he is naturally invited.

Although the opinions of people from all walks of life are not very unified, the mainstream view still hopes that the Hong Kong government will resolve the Hong Kong dollar exchange rate crisis first. Only when the Hong Kong dollar exchange rate crisis is resolved can the concerns of merchants be eliminated and trade in Hong Kong can the Hong Kong economy be restored. In this way, the stagnant water of the Hong Kong economy will be injected with live water and restore vitality.

To resolve the Hong Kong dollar exchange rate crisis, everyone's suggestions are divided into two types: one is to use the Hong Kong government's foreign exchange reserves to repurchase the Hong Kong dollar sold in the international foreign exchange market.

This is also the mainstream international response method. However, the disadvantage is that once the Hong Kong government's foreign exchange reserves are used up and the Hong Kong dollar sold in the international foreign exchange market is still increasing, the Hong Kong government will have to lower the Hong Kong dollar exchange rate.

In this way, the assets of Hong Kong will shrink due to the lowering of the Hong Kong dollar exchange rate, and the losses will be even heavier. One of the big reasons why the Hong Kong and British government did not dare to use foreign exchange reserves at the beginning was one of the big reasons.

Another suggestion is that the Hong Kong government formulates policies to strengthen financial supervision, especially restricting foreign exchange circulation and lending between banks. In this way, even if the Hong Kong dollar exchange rate is lowered, foreign capital will find it difficult to snipe the Hong Kong stock market, futures market, etc. At the same time, restricting lending between banks will also avoid hot money from unlimited lending of Hong Kong dollars from Hong Kong banks, consuming the Hong Kong government's already small foreign exchange reserves.

However, the disadvantage of this suggestion is that Hong Kong is a free trade port and there is no restriction on foreign exchange import and export. It is precisely this reason that so many foreign banks have set up offices in Hong Kong, which has made it the world's top financial center.

The financial industry is the pillar of Hong Kong's economy, contributing more than 10% of GDP every year. Once the Hong Kong government implements financial controls, the Hong Kong financial industry will definitely be hit hard.

The financial industry provides funds for other industries and provides them with the impetus for development. Once the financial industry is hit, it will inevitably affect other industries, especially the real estate industry and the trade industry, and will have the highest dependence on the financial industry. Once these two industries collapse, the Hong Kong economy will be even worse.

...

The two methods have their own advantages and their own shortcomings. It can be said that there is no way to perfectly resolve the Hong Kong dollar exchange rate crisis without any damage.

After all, this Hong Kong dollar exchange rate crisis seems to be an isolated incident, but in fact it is the result of Hong Kong's years of implementation of the wrong exchange rate system.

Since 1983, Hong Kong has adopted a linked exchange rate system to fix the exchange rate between the Hong Kong dollar and the US dollar at 7:8. Every time Standard Chartered wants to issue Hong Kong dollars, it must first pay an equal amount of US dollars as margin before it can issue Hong Kong dollars.

This move has increased Hong Kong's foreign exchange reserves, reduced exchange rate fluctuations caused by speculation, reduced instability in economic activities, and allowed banks, companies, individuals, etc. to have stable expectations for income, which is conducive to reducing transaction costs.

However, its defects are also very obvious. First, the Hong Kong dollar uses the US dollar as its foreign exchange reserves. Once the Hong Kong dollar is attacked and the foreign exchange reserves are exhausted, the Hong Kong dollar credit will decline significantly.

Second, the Hong Kong dollar exchange rate is fixed, and the US dollar is rising, which makes the Hong Kong Authority lose the flexibility and initiative to adjust the economy and loses the ability to use monetary policy to regulate the Hong Kong economy.

Third, the Hong Kong dollar is linked to the US dollar exchange rate, but the Hong Kong economy and the US economy are not at the same frequency. Therefore, the interest rate level of the Hong Kong dollar cannot fully reflect the reality of the Hong Kong economy. Once the Hong Kong dollar interest rate deviates from the US dollar interest rate, it is likely to affect the stability of the currency and be taken advantage of by international hot money to make profits.

Moreover, although the Hong Kong dollar is pegged to the US dollar, the Hong Kong economy is increasingly affected by the mainland economy, so Hong Kong's monetary policy is becoming increasingly inconsistent and increasingly incompatible with the current development needs of Hong Kong.

...

Xia Tian is the faction that strengthening financial controls is only a temporary policy, and controls can be liberalized after the economic crisis.

However, if foreign exchange reserves are used to save Hong Kong dollars, once tens of billions of dollars of foreign exchange reserves are exhausted, it will not take a day or a night to accumulate them.

What's more, after resolving this economic crisis, Hong Kong's future development still requires a large amount of capital investment. Without foreign exchange reserves, what will the Hong Kong government use to promote the economy?!

His opinions were supported by many people, especially those who were pro-Mainland. They had reached a consensus when they were in the Mainland.

The faction led by Li Jiacheng supports the use of foreign exchange reserves to save the Hong Kong dollar exchange rate. They believe that Hong Kong's business rules cannot be changed at will, as it will damage Hong Kong's credit and status. It seems to solve the urgent problem, but in fact it is to drink poison to quench thirst.

Because you can make money again after spending all your money, but your reputation is bad, and it will not take a long time to repair it. It is better to use foreign exchange reserves to save the Hong Kong dollar exchange rate. Even if you lose money, at least it will establish a good image of Hong Kong complying with the rules of the game, so that international capital will be full of confidence in Hong Kong, and naturally there will be no shortage of repeat customers in the future.

There are many people who support him in this faction.

...

The two factions had different opinions. The symposium was held many times, but no unified opinion was reached.

Xia Tian knew that Li Jiacheng supported the use of foreign exchange reserves to save the Hong Kong dollar exchange rate, and his real purpose was not to save Hong Kong's credit.

In fact, in the international community, both the political and business circles, the so-called credit is dog x!

Whether it is the world or the business world, all of them are the strong, and the big fist is the hard truth!

The United States invaded Iraq under the guise of "eliminating weapons of mass destruction". As a result, after searching in Iraq for seven years, digging three feet into the ground, but failed to find the so-called "weapons of mass destruction".

However, Iraq and its neighboring countries have fallen into turmoil because of this war. Peace has not been restored until now, and even the most basic personal safety cannot be guaranteed.

Google once regarded "not doing evil" as its company's slogan, but in fact, Google participated in the FBI's prism program, helping them monitor billions of Google users, seriously infringing on users' privacy rights. Moreover, Google has begun to cooperate with the US military in the past two years to provide AI technology for their drones.
Chapter completed!