As the tide recedes, the swimmers who were naked emerge.
Following the Japanese yen's exchange rate continuously hitting a 34-year low, the Vietnamese dong also experienced a wild devaluation.
In the just-concluded April, the Vietnamese dong against the US dollar once set a historical high of 25,365, but by May, the exchange rate of the US dollar against Vietnam continued to rise, and the devaluation trend of the Vietnamese dong is further intensifying.
With the Vietnamese dong's exchange rate plummeting by 30%, Vietnam's 20 years of hard reform are almost ruined at once, and the economy is severely impacted.
Why is the Vietnamese dong devaluing wildly? Can Vietnam's "rise dream" still be realized? What role has Jewish capital played in this?
Exchange rate plummets, foreign exchange is severely insufficient
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Some time ago, due to the Federal Reserve's consecutive postponement of interest rate cuts, the US dollar remained at a high interest rate, and other currencies faced significant devaluation pressure.
In addition to the Japanese yen against the US dollar once breaking through the historical highest point of 160, the Vietnamese dong also devalued wildly by 30%.
To cope with this crisis, the State Bank of Vietnam sold 110 million US dollars on April 22, and then sold hundreds of millions of dollars the next day, but unfortunately, it has not formed a strong support for the Vietnamese dong so far.In response to this, the State Bank of Vietnam has indicated that after being forced to sell a large amount of US dollars at the beginning of the year to support the Vietnamese dong, it is now supporting its foreign exchange reserves by purchasing more US dollars. However, in reality, this is precisely Vietnam's biggest problem at present: a severe shortage of foreign exchange reserves.
This year, Vietnam has witnessed the largest financial fraud case in its history: Vietnam's richest woman, Zhang Meilan, used hundreds of shell companies and agents to acquire more than 90% of the shares in Saigon Commercial Bank, thereby defrauding a large amount of bank loans for her own expenses and daily bribery.
What kind of colossal case is this? Zhang Meilan forged a total of 916 loan documents and defrauded a cumulative amount of 304 trillion Vietnamese dong, equivalent to 90 billion yuan.
In order to fill the huge hole dug by Zhang Meilan, the State Bank of Vietnam had to inject a large amount of special loans into Saigon Commercial Bank. As of April 2, the scale had reached 24.72 billion US dollars.
It should be noted that Vietnam's annual GDP is only 430 billion US dollars, and its foreign exchange reserves are only 100 billion US dollars. This amount exceeds one-fourth of Vietnam's foreign exchange reserves.
The disaster caused by Zhang Meilan alone requires the entire Vietnamese authority to clean up after her.
Why is the Vietnamese dong exchange rate plummeting incessantly?Not only the Vietnamese dong, but also in this round of the Asian currency defense war, Asian currencies have collectively depreciated, all of which are inextricably linked to the dollar's harvest.
During the pandemic, the US dollar's monetary policy was loose, and the Federal Reserve released a massive amount of liquidity.
As an emerging economy, Vietnam attracted a large inflow of US dollars, leading to rapid economic development, and at one point, some even believed it would replace China's position as the world's factory.
However, it can be said that both success and failure are due to the US dollar. As the Federal Reserve began its interest rate hiking cycle, Vietnam's economy, which is overly dependent on US exports, was instantly knocked back to its original state.
This logic is not hard to understand. Initially, when the Federal Reserve released liquidity, market demand increased, and naturally, the demand for Vietnamese goods would also remain high.
But as the Federal Reserve's monetary policy tightened and market demand weakened, the export volume of Vietnamese goods would also decrease accordingly.
This means that Vietnam's exports are hindered, factories shut down, and unemployment rates soar.
Especially with the US dollar interest rates remaining high, a large amount of foreign capital fled from Vietnam to the United States to enjoy higher interest rates. In the short term, a large amount of Vietnamese dong was exchanged for US dollars, leading to a significant reduction in liquidity and a subsequent devaluation of the Vietnamese dong.
Generally speaking, at this time, the central bank would need to act decisively, using its foreign exchange reserves to sell US dollars and buy Vietnamese dong to lift the country's currency exchange rate.
However, don't forget that the previous case of loan fraud involving Vietnam's richest person, Pham Nhat Vu, has already caused a huge shock to Vietnam's financial system, and 1/4 of the foreign exchange reserves have already been used up.Thus, the ultimate outcome is that the Vietnamese dong exchange rate plummeted incessantly. Calling it a "return to poverty overnight" might be a slight exaggeration, but describing it as being in dire straits is nothing but fitting.
Jewish Capital Shatters the "Vietnamese Rise Dream"
Frankly speaking, Vietnam's development pace has indeed been quite rapid in recent years, especially with the United States' ulterior support, it was once considered有望 to replace China's position as the global manufacturing center.
However, the facts have proven that Vietnam's long-standing "rise dream" is being shattered by the United States, the "big brother" they once pinned their hopes on.
As is well known, Jewish capital is the true decision-maker in the United States.
In fact, if we carefully examine Vietnam's GDP data, we will find that although Vietnam's GDP growth rate is very high, more than 90% is contributed by export trade, with domestic consumption accounting for less than 10%.
More importantly, as Vietnam's largest export country, the United States can account for 30% of its total export volume.
This means that Vietnam's trade and investment structure itself is in a deformed state. Whether it can make money and how much it can make depends on the Americans' facial expressions.
In addition, Vietnam has not used this opportunity to build a basic domestic industrial system. What it has done is basically the labor-intensive industry, which is equivalent to building a large area of high-rise buildings on the beach, all of which are castles in the air.
Slight waves on the sea surface can lead to a catastrophic rhythm within Vietnam.Nowadays, the United States is preoccupied with its own affairs and faces indiscriminate harvesting initiated by the US dollar. Naturally, the Vietnamese dong has no power to fight back, and the long-cherished "rise dream" is becoming increasingly distant from realization.
In conclusion:
With a significant withdrawal of foreign capital, the outbreak of major financial cases, and a severe shortage of foreign exchange reserves, the sharp devaluation of the Vietnamese dong may not have come to an end.
If such a trend continues for a long time, and Vietnam's foreign exchange reserves are exhausted, another country on the menu may emerge.