July 2, 1998, this is definitely a memorable day in the history of American finance, because on this day, the US stock market finally triggered the first circuit breaker in history.

Columbus TV reporter O Feiyin, who was interviewing on the New York Stock Exchange at that time, revealed this scene very well.

Ou Feiyin was originally just conducting a normal live interview here, but she didn't expect the stock market to suddenly fall across the board without warning. Ou Feiyin didn't expect this to happen, but soon she realized that this was an opportunity for her, especially after seeing the stock market's decline approaching the red line, she quickly adjusted back and broadcasted the situation to all viewers.

"I simply don't know what happened. It's like the end of the world. All stocks are falling. Yes, you heard it right. It's all the stocks that you can call, whether it's Citibank or GE, they are falling. I seem to see a group of devils throwing stocks, making those originally priceless stocks instantly worthless."

"Ten minutes have passed now, and the declines of the three major stock indexes have crossed the 5% red line. The most serious Dow Jones Industrial Average has even reached 6%. This is very scary. According to the total market value of the US stock market, hundreds of billions of dollars have evaporated in the stock market! This reminds me of the terrifying Black Monday ten years ago."

"No, this is not the most serious. I think with the current market panic, it is very likely to trigger the circuit breaker mechanism. That is, after Black Monday, the Securities Commission gave the stock market insurance to the stock market. As long as the decline exceeds 7%, it will trigger an automatic suspension. Are we going to witness history now?"

As an uproar broke out in the exchange, Ou Feiyin turned around and saw the word "circuit break and shut down" jumping on the blood-red market.

Ofeiyin widened her eyes. She looked at the market with an incredible expression, just like all the other people here.

"It fuses, fuses, he opens his teeth and claws and waves his sickle. He finally comes! Just now, the Dow Jones Industrial Average fell completely, falling below the 7% mark, triggering the first round-break in history! I can't believe my eyes. Yesterday, the president's economic adviser told the world that it was impossible to have a round-break, but it has happened now. This is not an exercise, it is a real round-break!"

Ofeiyin shouted loudly with the microphone, as if she wanted to use all her strength, and her words also became trembling because of her so hard.

However, no one would laugh at her for being incompetent, because at this time, everyone on the exchange, even the entire United States, did not know how many people were incompetent than her.

In the exchange hall, a group of stock brokers surrounded the trading counter. They asked loudly why they were not allowed to sell their stocks, but they knew that they had lost millions of dollars in just a while. At this moment, these people were no longer gentlemen in suits and tie-ups like those they came in the morning, and they all became hideous debt collectors.

The exchange is just tired of dealing with it, indicating that circuit breakers are a trading mechanism, and as long as circuit breakers are triggered, they will be forced to suspend the market, and no one can trade.

The circuit breaker mechanism is indeed a mechanism that the exchange has long announced, but ten years have passed since its establishment and has never been triggered. Many people have long forgotten it. Besides, even if these people still remember it, they will not accept this conclusion.

As a result, after all, the loss of millions of dollars means that they will lose their jobs, be sued by customers, and eventually become homeless people. They will bear a lot of debts for their entire lives and will never be able to turn over.

Not only these people, but also these wealthy people who are worth millions and millions in the offices of the Manhattan Financial Building are also anxious to jump in the office because their entire wealth is in the stock market.

The capital market carries everyone's wealth!

This is not just a simple statement, at least it is a real reality in the United States.

For most Americans, they do not have the habit of saving. Whether rich or ordinary people, they are used to investing in the money they earn, and their daily consumption is done with credit cards.

Because in their opinion, simply putting money in the bank will only continue to depreciate. Only by converting money into investment can we effectively ensure that our assets will not shrink. At the same time, the practice of "spend tomorrow's money to do today' can also allow ourselves to have a considerable investment reserve in a short period of time.

This is why many people always think that Americans are relaxed and rich. In fact, if you can compress your annual income to a month or even a day, your funds will be very abundant.

This way of borrowing money through banks and then converting money into investment can indeed allow your assets to accumulate quickly, but at the same time, it also has a huge disadvantage, which is that it has extremely poor risk resistance. A simple financial crisis or an investment mistake can make you go bankrupt immediately. This is why millions of people can apply for relief funds in the United States for one or two months in the future, otherwise it will be a problem for eating.

The same is true for rich people. Their houses, cars and even the daily turnover of companies is completed by a large number of bank loans, and there are also many people who demolish the east wall and repair the west wall to repay the loan. Of course, this has a better name, called the capital chain.

If it is just a simple turnover of capital, even a loan will not go bankrupt. But the problem is that these rich people often use financial leverage to invest in order to pursue the maximum return of investment. Simply put, it is to use margin to invest. Just like Zhou Ming's previous short stock index futures, he used margin to lend stock investment from brokers or others. If he wins, you will use 10% of the funds to win 100% of the stock return. If he loses, he will lose all his money.

There is no doubt that this is a game with great risk, but which gambler will resist playing a few times when he arrives at the gambling table?

It is precisely for this reason that once any link in the capital chain has problems, these wealthy people with a net worth of hundreds of millions will immediately go bankrupt and become beggars.

Of course, under normal circumstances, the probability of wealthy people going bankrupt is very low, because their investment is basically diversified investment, that is, not putting eggs in one basket. In this way, even if the stock market is not good today and the Fed raises interest rates tomorrow, the stocks in their hands will always rise and fall, and they can also get dividends from companies. In the long run, it is difficult for this investment plan to suffer losses.

From the perspective of probability, this kind of investment method is also very scientific, but unfortunately, the reality is not probability. Once the capital market experiences a full-scale plunge, no matter any investment plan, there is only one way to go bankrupt.

"Sell quickly, I don't care about any method you use, no matter how low the price, please throw it all right away.

, Now now!"

I don’t know how many people yell at their phones in the office, as if the louder their roars were, the more they could sell out the stocks they had in their hands.

However, the fact is that when the entire market is selling, and there are only sellers and no buyers in the entire market, then this has nothing to do with your selling posture.

Mark is the most representative of these rich people. He owns his own fund investment company in Manhattan, with a net worth of tens of millions and holding hundreds of millions of capital investment. He is also a professor at the School of Economics of Columbia University and a special commentator for Fox TV and the Wall Street Journal.

What Mark usually admires most is his investment model that never loses money. Mark has made public statements on TV shows and newspapers more than once: No matter how the stock market changes or what kind of crisis occurs, his investment will definitely make money!

Not only that, even when someone sent out a circuit breaker danger, Mark laughed at this as "coward's ignorance". He believed that it was at such a crisis that the level of investors could be better reflected, and he also sent out bold words such as "I am moving forward in the storm, and he was the real hero" and "All investment losses are the ones they do not know how to avoid risks."

But as the saying goes, do the most ruthless thing. After the US stock market triggered the circuit breaker mechanism, Mark was stunned at the time because he knew very well that his so-called investment model was essentially a large diversified investment. Of course, there was no problem with the stock market rising and falling, but now the entire stock market has fallen across the board, which is not something that any operational means can make up for.

Of course, if Mark has sufficient funds, he can seal all his investments and wait until the crisis has passed. After all, many of Mark's investments are industries like General Motors Rockefeller. Whether it is the value of the company itself or the dividends of shares, there will still be profits.

But the problem is that he does not have such sufficient funds. His fund company's office, his house, water and electricity, his employees' wages, his car loans and his credit cards, and his fund company also borrows bank loan turnover. It can be said that at least half of the hundreds of thousands of dollars Mark earns every month have to be handed over to the bank.

Not to mention, he has added countless financial leverage to his investment. Once a crisis occurs, he will go bankrupt in less than half a month.

Mark didn't want to have nothing to do with him. He wanted to sell his car and house and then find a way to wash out the money, but the bank and his wife were obviously faster. The bank's lawyer first sealed his house, and his wife drove away with all the valuable things in the family.

"Can I pay off the money, aren't it just those loans? You don't have the right to seize my house, this is my home..."

"I am the boss of Skyrim Investment Company. I am not the same as those damn poor people. I have no problem with my investment. You should give me a chance..."

When Mark was kicked out of the house, he also heard the roars of others one after another. There was no doubt that besides him, there were many more people who were kicked out of the house because of bankruptcy.

Walking out of his high-end apartment building, Mark could see many walking dead people wandering on the street. Their eyes were dull and confused, and some even rushed towards the car that was driving.
Chapter completed!