"According to data from our field visits, the planting area and expected yield in traditional cotton-growing areas such as Shandong and Henan have been negatively affected and reduced this year due to the cold wave and rain during the sowing period.

The situation is even more serious after in-depth field investigations. Looking at the latest cotton production data released by the U.S. agricultural department and the recent price trend, it is inevitable that cotton prices will continue to rise..."

Yongan is the main brokerage firm for domestic futures market transactions, and most of the hot money in Jiangsu and Zhejiang likes to gather here.

Relying on strong financial resources and regional advantages, capital from Jiangsu and Zhejiang has been continuously reaping the benefits of its competitors in the futures market in recent years, and this cotton futures transaction is no exception.

But what makes the main speculators feel sick is that there is another bullish force in the market that is snatching the profits that should belong to them, and based on several previous attempts, it is clear that the other party has far more funds than they do.

The futures market is the most direct zero-sum game. Judging the direction of the situation and following the trend are certainly important, but the decisive factor is always the scale of capital.

Without sufficient positions and backup funds, it is easy to be slaughtered as a fat sheep. In the reversal battle between the long and short positions on both sides in early June, hot money in Jiangsu and Zhejiang sold a small amount of orders to try short selling.

As a result, they were all taken up by the other party with huge long orders, which led to the failure of their attempt to reap the profits in reverse. The main participants at that time were so angry that they started cursing.

How can one dominate the market like this? Only newcomers who don't know anything about the business would push the price up single-mindedly. Old birds like them who have been baptized by the futures market for a long time.

I like to set traps the most. Even if the whole world knows that the price of cotton is going to rise, it cannot go up all at once. If it rises by 500 today, I have to short it tomorrow to shake off those who try to follow the lead and make money.

By the way, they also trick some ignorant people into entering the market and short selling. Anyway, the information is true and false, and there will always be people who are deceived.

Only by jumping back and forth and continuously reaping the benefits can you make more money.

But the other party didn't think so at all. It seemed that he was determined to push the cotton price up and would not allow even the slightest pullback. This made people very uncomfortable. How could they trade like this?

“Fuck, what’s the point of knowing that the stock will go up? There are not even a few short positions in the market right now. Everyone is rushing to buy, and the trend has been formed and it is difficult to change.

If you want to blame someone, blame this group of funds. They don’t dominate the market but try to be the first, making it so that no one can make money.”

Many people among the hot money were dissatisfied, so they sent people to investigate and found out that these long institutions were all entrusted by agreement. Except for the trading team that bought on their behalf, no one knew who the boss behind the scenes was.

I searched a lot and spent a lot of money, but didn't find much useful information.

Some people also suggested, "Why not just report it to the exchange? After all, holding positions on behalf of others through a commission agreement is not that formal."

Everyone thought it was right and was about to take action, but was quickly stopped by someone, “We’ve tried it, it doesn’t work.

The rules of the exchange allow licensed companies in the industry to hedge risks through futures trading, and most of those that hold positions are textile companies.

It complies with this regulation, so even if we report it, it will be useless. Those people in the trading team received the money and sold the news, but we cannot get the original copy of the entrustment document.

Without clear evidence, it’s useless to file a complaint anywhere.”

Those who are angry can only rage helplessly, "So are we just going to watch this wicked, smoking thing continue to dominate the market and make us lose billions of profits in vain?"

"It would be great if we could find a way to get it to sell long and short. We brothers are all well-known figures in Jiangsu and Zhejiang. Why don't we join forces and get some American capital to cooperate.

In the name of textile enterprises, they obtained a batch of cotton reserves from the State Reserves Bureau, purchased some from the market, and sold them to several major state-owned enterprises at an agreed low price.

As long as they have one or two months of inventory to consume, and then leak information to the market, and there is US capital outside to cooperate in spreading the news, they may be able to take advantage of the situation to short sell and knock down this obstacle first. "

Some of them also made similar suggestions, which soon received enthusiastic responses, and some people helped to fill in the gaps, saying, “It really can be tried. The major state-owned enterprises have a lot of say in the industry.

With their help in spreading the word, it has a great influence on the market.”

Some people are also seriously considering the feasibility: "The demand from major state-owned enterprises is not small, and they often need tens of thousands of tons of spot goods. Maybe even if we invest 1 billion yuan, we won't even make a splash.

In addition, the settlement cycle is long, the interest expenses on advance payment are high, and there are many uncontrollable risks. What should we do if an accident occurs?
There are now more than 8000 cotton-consuming enterprises in the market, and the monthly demand for cotton is at least 50 to 55 tons. Several major state-owned enterprises do not even have a 1/5 share.

But even so, to stabilize the market, at least 100,000 tons of cotton must be prepared to cope with the first wave of demand, so that large companies have inventory and will not continue to push up cotton prices.

Small and medium-sized enterprises do not have pricing bargaining power, so it is difficult for them to form a unified trend in a short period of time. There is no problem in taking advantage of this time difference to make a short correction. "

"That's what we did. I can tell you responsibly that this time it's not just us in Vancouver that are banding together to make the market.

Even the main force on the American side will cooperate in making short-term corrections. Capital from Shanghai, Ningbo and Qiantang will also participate. The Minsheng Department has prepared sufficient funds for this operation.

Please let go and do it boldly..."

The convener of the meeting quickly set the tone, and after the meeting, he went to a secluded place and reported the situation on the scene in detail to the person behind the scenes.

“Mr. Lu, everyone is very enthusiastic. When they heard that Goldman Sachs and major domestic capital were leading the way, they all expressed their willingness to follow the big trend and make a profit.

In addition, according to your instructions, Qingyun’s holdings have not been disclosed, and many people are still speculating about who the opponent will be this time.”

The mastermind behind the scenes is none other than Lu Zhiqiang of the Pan Jiang faction.

“You did a great job, but don’t overestimate the nature of these people. They will only enter the market when they are sure it is profitable.

That's ok, as long as the news is delivered to the right place, I don't expect them to be a timely help, but it would be nice if they can be the last straw that breaks the camel's back."

Lu Zhiqiang has a perfect grasp of human nature. He did not tell everyone that his opponent was Qing Yun in order to prevent everyone from feeling fear. After all, the other party had just reaped huge profits from the international capital market.

Not to mention his fame, he is also a terrifying presence. What if someone can't stand the pressure and goes to inform on others? How can this financial hunt continue?

There is no need to elaborate on the grievances between the Qingyun faction and the Taishan faction. Liu Aiguo was sent in by Li Zehua, and now it is destined to end in a fight to the death.

They had finally found out Qingyun's positions in cotton futures, so how could they miss this opportunity?

This time, Lu Zhiqiang went to Zhejiang Province, Guo Guangchang was in Shanghai, and Yang Yuanqin in Beijing all mobilized their connections at the same time, gathering big speculators from all over the country to form a group to deal with Qingyun.

According to the information obtained from the investigation, Qingyun’s long cotton positions in China account for more than 20% of the market’s long positions (actually more than 35%).

In the Chicago Agricultural Products Exchange, Qingyun Group is also a major bull.

Things are often so dramatic. Goldman Sachs' investment department A is a group of people who make money in the gold futures market through cooperation with the owner of Meizhuang and the Qingyun Group.

There is another group of people in its investment department B, who are now eyeing the long orders of cotton and other grains held by Qingyun.

It seems that they are planning to join forces with domestic and foreign forces to completely eliminate Qingyun Group.

With the secret planning of these well-connected people, hundreds of thousands of tons of cotton were mobilized in minutes and supplied to several large state-owned factories at the agreed middle price.

As they publicly announced that production was stable, raw material inventories were sufficient, and there was not much demand for cotton in the market this year.

A large hunting net targeting Qingyun in the capital market was thus opened...

Li Zehua woke up in the morning feeling refreshed.

My arms are a little sore and both hands are numb.

This is the price of being willful. Others take one person at a time, wash, dress, and finish everything within three seconds to start cleaning the battlefield.

It's his turn, double the fun, starting from two hours to taste the newness, and staying up all night without feeling tired~
But before I could wake up the two sleeping people, the phone rang, so I picked it up.

"Chairman, something is not right. You asked me to send people to keep an eye on those big factories. There have been vehicles loaded with raw materials entering the factories in the past two days."

The call was from Yao Xiangjun, who sounded a little anxious, "Something is not right with the market, whether it's the Zhengzhou Stock Exchange, the Shanghai Stock Exchange, or the Chicago Stock Exchange.

There are small multiple short orders being built one after another.”

"The National Reserves Bureau is probably the only one in China that can make you feel so stressed." Li Zehua casually instructed, "Check the source of the inventory, and closely monitor the futures market. If necessary, you can lock the position without asking for permission.

In addition, the investment team was informed that the July bullish options can be sold one after another, and the September bullish options and November bearish options can be replaced. "

After hanging up the phone, Li Zehua sneered, "If it were someone else, they really wouldn't be able to tell the truth from the falsehood from the complicated sources of information.

It's a pity that you met me.

The fundamental reason for the surge in cotton futures prices is that it disrupts the overall environment here, forcing more concessions to be made, and making money is just a by-product.

The ultimate goal is to remove all kinds of shackles, allow free flow, and facilitate quick in and out of Squid Capital, and continuous harvesting.

As long as this point is clearly seen, the textile industry will inevitably become a key target. In other words, the price of cotton will definitely rise to the point where downstream factories will close down on a large scale.

They will only stop when millions of people are unemployed. In this process, all reverse short selling is a trap.

It’s a pity that we can’t judge how determined these people are and how much money they have. It would be great if we could increase our positions accordingly and completely blow them up.”

Thinking of this, his mind started to become active. If he could get the remaining reserves from the National Reserves Bureau and then start a fire, maybe he could trap a group of people in a trap.

“It’s difficult, but not impossible. We must give a heads-up to the higher-ups so they have a clear idea of ​​what’s going on, and then we can do it before the branches in various places react.

Through market bidding, we arrange centralized purchasing for the companies we control, and strive to clear out all inventory except for strategic warehouses in one fell swoop.

By then, as soon as the news gets out, the market will inevitably go idle and cause a stampede. There will be only one way to save the situation.

That is, the four major grain traders in the United States should work together to supply sufficient cotton to Dongda, otherwise all short-selling institutions, hot money, and individuals will have a dead end.

The question is, will they do that?

Compared with the random harvest after a mess, how big is this?

It's just over 10 billion US dollars at most. Even if someone intends to take the risk and betray the joint plan to replenish the inventory of Dongda, it cannot be done in a short period of time.

By that time, the group would have already turned from long to short, aggressively selling off inventory and newly listed cotton."

There are risks, but they are within controllable range. Li Zehua is not panicked at all because his plan has been completed and now there is no need for large-scale uncontrollable risks.

Otherwise it would be impossible to reverse the situation.

"Wang Fei, make arrangements immediately. I need to meet with the heads of the Development and Reform and Agriculture departments right away. Tell them that I have something very important to report."

……

"It doesn't make sense. The trading volume of the two markets has skyrocketed from hundreds of millions to more than a billion, with hundreds of thousands of additional short orders and millions of tons of physical delivery. How come the market price has only dropped so much?"

Yang Yuanqin couldn't understand why they all worked together, using more than 8 billion in cash to purchase tons of spot goods from the spot market and hand them over to the major textile manufacturers.

Their continued public release of information over the past week has indeed influenced a large number of small and medium-sized textile companies to wait and see. In fact, textile companies will reserve a batch of raw materials in their inventory in advance.

Now that prices continue to soar, each company will only purchase a portion as a safety stock. This is determined by the industry's operating model.

In the textile industry, which has slim profits and relies on volume to win, the cost of raw materials determines the life and death of an enterprise. Once the price of raw materials plummets in the future, the procurement cost will be too high and it will be unprofitable.

The only result of an inverted cost and sales is bankruptcy. Others can sell at a low price by using low-priced cotton, but how can they reduce the price if they purchase a large amount of high-priced cotton in advance?

Therefore, the textile industry is also one of the industries most affected by the financial industry. Almost every large-scale enterprise will hedge risks in the futures market, and they were the main force in the long position before.

Now, Squid Capital, comprador capital and hot money are openly supplying goods, intending to short sell and reap the long orders of small and medium-sized enterprises in the short term, and then turn around and immediately raise prices to reap the profits again in the spot market.

They join forces with large companies to control the market by publicly publishing industry forecasts and reducing purchasing scale, and then the capital gets the profit after the harvest.

Everyone is happy when large companies gain market share vacated by bankrupt small and medium-sized companies.

It’s just that there is money from the Qingyun system involved, so this time the long-killing war will last longer and involve a slightly larger amount of investment.

But as billions of funds were invested, the price only dropped from 19500 to around 19200, which made Yang Yuanqin very confused.

When he called Guo Guangchang for advice, the latter was also a little confused, "Logically speaking, it is a huge negative for large companies to postpone acquisitions, and there are not enough buyers in the spot market.

The market will be inverted. The day before yesterday, the spot price of cotton in stock in the main producing areas of Shandong Province was 1.88 yuan per ton, which is far lower than the futures price. "

Yang Yuanqin asked, "Is it Qingyun Group that is resisting?"

"We cannot rule out this possibility, but news from the United States shows that Qingyun Investment's exposed positions are being liquidated on a large scale, and there seems to be a sign of withdrawal."

Guo Guangchang couldn't understand his opponent's thoughts for a moment. "It could be that new funds are entering the market. Anyway, don't worry. The price in the Chicago market has already started to go down.

Unfortunately, we have not caught the main capital of Qingyun Investment, and we are not sure how many of the remaining long positions are trapped by the Qingyun system. "

Little did he know that in fact Qingyun Group's long positions were not closed at all, but were simply transferred back and forth between securities company accounts, and some hedging orders were added to lock the positions in advance.

The main focus is on contribution fees.

There is no other way. In America, Qingyun Group is still too young to deal with giants like the four major grain traders and Goldman Sachs at the same time, even if it puts all the liquid funds of the entire group on the line.

It's not enough to fill the gaps between people's teeth.

After following the main trend and making some profit, Li Zehua immediately chose to quit while he was ahead and used more securities accounts to hide his positions.

His goal has always been to keep an eye on the domestic futures market, but the State Administration of Reserves has not yet bought out all the reserves, so the news has been kept secret for the time being.

These short sellers don’t even realize their death is imminent.

When the total cotton storage volume drops to a dangerous level, the State Bureau of Reserves will naturally disclose the data to the market. By that time, there will be no cotton on the market.

By then, textile companies that have money but cannot buy cotton and realize they have been cheated will naturally become anxious and try every possible means to purchase cotton from the market, and the price will naturally be pushed up.

And the textile companies that have established contact with the Qingyun Group in advance are now waiting to see the joke.

Yang Yuanqin looked at the anxious price curve and felt anxious. "Our goal is to make a quick attack. We can't delay for too long. We should urge the United States to release the news as soon as possible."

"Don't worry, we have already arranged it. We will make a public statement before the market closes on Friday afternoon. The four major grain traders will act together to ensure that the market can be turned around in an instant."

Guo Guangchang was not worried at all, "It's only about two days, just wait patiently!
I have a hunch that Qingyun Group must still have its long orders in China, as the total amount of long orders continues to increase. Even if new large funds enter the market, it is impossible to take up so many orders at the same time.

You know, July is the contract delivery month, and the short position we hold now is equivalent to the demand of the national textile trading market for two months. Which bull can take up so much physical goods at one time?"

After he said that, Yang Yuanqin felt relieved, "If you hadn't told me, I would have forgotten. Maybe those who bought more forgot to deliver the goods?
When the time comes, we will say hello to the Nanyang Gang, lock up the warehouses, and trap their funds in there for a few months, and then slowly deal with them when the prices drop."

“So don’t be in a hurry. First cooperate to pull the price back to around 1.7, and then slowly close the position and continue to go long.”

Guo Guangchang smiled.

Li Zehua also laughed happily, because the overall layout of both parties was not on the same level at all. The opponent wanted to rob Qingyun by shorting, but they didn't know that Qingyun was going to cut off their source of funds.

At worst, we can just release all the inventory positions and make all these people go bankrupt. (End of this chapter)