In the past week, the first wave of attacks by international financial speculators against the Thai currency ended with the Thai government narrowly coming out on top. However, Chen Qing, who had privately reviewed extensive economic data on various Asian countries provided by her boss, knew that Thailand's economy was already teetering on the brink.
Take foreign exchange, for example.
After the first battle, the Thai government announced that its foreign exchange reserves still stood at $33 billion, which seemed sufficient. However, in reality, over 90% of these reserves had already been locked in due to a large number of forward contracts for the Thai baht. According to these hedging contracts, the Thai government would need to use these reserves to buy back the baht from financial speculators within three to six months.
Did overseas speculators really hold that much baht?
No.
Apart from a small amount of baht used as margin, the overseas speculators had borrowed a large amount of baht from within and outside Thailand, which they then converted into US dollars. This was one of the primary ways to profit from foreign exchange operations.
First, by betting against the baht, international speculators exchanged the borrowed funds into US dollars. At the time, 10 US dollars' worth of baht might only require 5 US dollars to buy back for debt repayment after the Thai currency depreciated. The remaining 5 US dollars would be the speculators' profit.
Thus, this was essentially a gamble.
Since a large portion of the foreign exchange reserves had already been locked in, recklessly using them would only bring greater risks. Therefore, if the Thai government wanted to counter the attacks from international financial speculators again, it would have to borrow money after exhausting the remaining usable reserves.
Borrowing money means having to pay it back.
And if they couldn't pay it back, the consequences would be even worse.
So, without breaking the rules, there was only one path left: to abandon the defense of the baht's exchange rate and let it depreciate. This would allow them to absorb the speculators' currency sell-off at the lowest cost. Once the overseas speculators ran out of baht, the crisis would pass.
Of course, they could also break the rules.
Just like when this crisis spread to Russia in 1998, the Russian government declared that it couldn't play the game anymore and directly announced a sovereign debt default while allowing the currency to depreciate indefinitely. This event nearly triggered another global financial turmoil caused by the collapse of the US-based Long-Term Capital Management.
But that's a story for later.
For now, the Thai government clearly wasn't as bold as Russia and was likely to raise the white flag soon.
As for the Westeros system, its main focus remained on South Korea.
Simon was currently flipping through a stack of profiles collected by a headhunting firm, which included high-level executives from South Korean companies and Korean-American elites in the US. Considering the sensitive and aggressive national characteristics of South Korea and the unique operational mechanisms of its companies, it would be inappropriate to directly send Western executives into South Korea. Instead, the best approach was to use Koreans to control Koreans.
However, unlike other overseas deployments of the Westeros system, the individuals Simon selected this time would be absolutely controlled by the system, with minimal delegation of power—essentially, they would be puppets.
On the boat on Taihu Lake, Simon casually flipped through the documents in his hand, ignoring Chen Qing, who had just entered, and instead asked the woman beside him, "I'm returning to North America the day after tomorrow. Do you want to come back with me?"
Before Mrs. Liu could answer, Miumiu beside her chimed in, "Yes, Daddy. It's so boring here."
Simon smiled and pinched the little girl's cheek. "Who was it that wanted to come back to China with me in the first place?"
The little girl pouted even more. "But you promised you'd spend time with us, and these days, you've been so busy. You haven't spent any time with me and Mommy."
"Hmm, my bad. Then let's go back together."
The woman on the other side, seeing that the man and her daughter had already decided, didn't object. She felt the same way.
A few days ago, the Guofeng Art Troupe had finished their performances in the UK and chose to take a break instead of immediately moving on to the next stop. Coincidentally, Simon was coming to China, so he notified them that those who wanted to could return home for a visit. Some of them had come back.
But after returning, they realized there wasn't much to see.
The mother and daughter had gone back home once, returning in glory and being envied by relatives and friends, but that was about it.
After chatting for a bit, Simon sent the mother and daughter away and then turned to Chen Qing, who was sitting beside him with sparkling eyes. He smiled and asked, "Did you follow along and place some bets on Southeast Asia?"
Chen Qing hadn't expected her boss to suddenly bring this up, but she didn't hide it and nodded. "You gave so many hints, Boss. If I didn't place some bets, wouldn't that make me seem too stupid?"
Simon nodded.
Chen Qing then brought up another matter. "Boss, regarding Hero, it's almost certain that we'll get it sorted out soon."
The issue with Hero was mainly about how it would be distributed domestically in China.
Like Crouching Tiger, Hidden Dragon, although Jinshu Media had assisted with it, it wasn't included in Jinshu's film list. This was because the film was primarily invested in by Daenerys Entertainment, and in China, it would still be distributed as an imported film.
Simon didn't have high expectations for Crouching Tiger, Hidden Dragon's box office in China, so it didn't matter much.
However, Zhang Yimou's Hero was different.
Although it was still tailored more for overseas audiences, considering Hero's past box office performance in China, if it were distributed as an imported film with a 13% revenue share, it would be a bit of a loss.
Therefore, Simon had proactively reached out to the authorities, hoping to secure the same treatment as domestic films for Hero through a joint venture with a mainland film company.
To this end, they had designed a plan that heavily favored the mainland.
For Hero, which was entirely filmed in mainland China and promoted Chinese culture, the foreign and domestic investors would negotiate a certain investment. The domestic investors would fully acquire the domestic rights, thus enjoying the revenue-sharing treatment of domestic films during the mainland distribution process. The foreign investors would only receive overseas profits and not participate in the domestic revenue sharing, while the domestic investors would only receive profits from the Chinese market.
The domestic partners Daenerys Entertainment hoped to collaborate with this time were China Film Group and Jinshu.
With a total investment of $30 million, China Film Group and Jinshu only needed to jointly contribute 20% of the investment to secure full domestic rights.
20% amounted to $6 million, roughly equivalent to 50 million RMB.
Given Hero's theme, it was highly likely to break 100 million RMB at the domestic box office, and even 200 million wasn't out of the question. Additionally, there would be some income from peripheral channels. Acquiring the rights for 20% was a very good deal.
Overall, this was a plan that heavily favored China.
As for Jinshu being a pawn of the Westeros system within China, that was irrelevant to the bigger picture.
Moreover, the premise of this special plan—whether it could pass the review—was entirely in the hands of the Chinese Film Bureau. It was all upside with no downside.
Coupled with Simon's connections, getting a special approval document wouldn't be a significant obstacle.
Hearing Chen Qing's words, it seemed that someone had already passed on the message, and it was pretty much a done deal.
Simon nodded lightly again, then remembered something else and said, "Regarding the matter of the aircraft carrier from Ukraine, don't meddle in it. Let it take its natural course."
Chen Qing blinked, then looked at her boss and roughly understood. She agreed, "I understand."
Though she still felt a bit of regret.
Her boss's meaning was that the Westeros system shouldn't get involved in this favor, which was a bit of a pity.
From her boss's position, it was indeed inappropriate to get involved in this matter. However, just a few days ago, when the Rivne Free Trade Zone in Ukraine was established, the Chinese delegation had also attended the signing ceremony. Chen Qing knew that the delegation's other task was to negotiate the aircraft carrier deal.
In the end, her boss had quietly provided quite a bit of convenience.
But since they weren't getting involved, then so be it.
Thinking this, Chen Qing changed the subject to something lighter. "Boss, in Call for Love, there's still a foreign actress role left. Aren't you going to specify someone?"
Back when Simon had provided a song and a concept for Call for Love, he hadn't been heavily involved in the subsequent script development. Therefore, even though they had found the original screenwriter, the new story was quite different from the past version.
Simon had recently read the completed script.
The new story was more in line with the current era. The male protagonist encountered various types of women: a businesswoman, an overseas returnee, a conservative woman, a celebrity chaser, a gold digger, and a justice-seeking woman, among others. It clearly carried some commentary on contemporary Chinese social phenomena. Among these roles was a "foreign woman," which explored the cultural differences between China and the West.
Hearing Chen Qing bring it up, Simon thought for a moment but couldn't immediately think of a suitable candidate. He smiled and asked Chen Qing, "Who do you think would be a good fit?"
"The bigger the star, the better," Chen Qing replied with a smile. "I know top Hollywood actresses have high salaries, but it's just a small role. If you ask, Boss, they'd probably be happy to come and make a guest appearance. For free, of course. We definitely can't afford to pay them."
With filming set to begin next month, the budget for Call for Love had been finalized at 20 million RMB, which was only about $2.4 million. This amount was less than half the salary of a top-tier Hollywood actress, so they could only rely on their boss to call in a favor.
Of course, if a big star came to China, all their accommodations would be covered.
Simon thought about it again and simply said, "Then I'll have Linda ask around. Whoever's willing to come can come. They can treat it as a vacation in China."
In fact, while such a guest appearance might not be profitable in the short term, in the long run, it would be highly beneficial for a Hollywood actress. Just like how Brooke Shields became widely known in China because of a line in a Spring Festival Gala skit, if an actress were willing to make an appearance in a purely Chinese film, she could gain significant popularity in China.
With the right approach, this popularity could be transformed into tangible benefits in the future.
Moreover, this was likely the last opportunity to accumulate such widespread attention.
With the advent of the internet era and the explosion of information, it would become increasingly difficult to gain nationwide recognition.
After spending one last weekend in China, Simon finally departed on Monday, May 12, ending his over-month-long overseas trip and returning to North America.
Although he had spent the last week leisurely on the boat on Taihu Lake, this trip to China had not delayed any important matters. After all, at Simon's current position, there were very few things that required his personal involvement, and there were countless people willing to handle things on his behalf.
Apart from some trivial matters related to Jinshu Media, during this trip to China, the Westeros system had made progress in its investments in Chinese real estate, food, technology, heavy industry, and other sectors.
The day after Simon returned to China, a special co-production film document tailored for Hero was officially announced, clearing the way for Hero and planned projects like the Legend of the Swordsmen trilogy.
Back in the US.
After being away for over a month, Simon returned to find the North American summer movie season approaching.
Before that, the four films released during the Easter season—Species II, The Cable Guy, Taken, and The Frighteners—were nearing the end of their runs. With Face/Off set to release on May 23, these films would be pulled from theaters to make room.
As of May 15, the last box office week before the summer season, Species II had grossed $82.73 million and was expected to finish with around $83 million.
The Cable Guy had grossed $56.31 million by May 15 and was unlikely to surpass $57 million.
Taken had grossed $80.62 million and was expected to finish with around $81 million domestically.
The Frighteners had grossed $62.93 million and was also expected to finish with just over $63 million.
Of the four films, only Taken was able to recoup its entire budget through domestic box office alone. The others would need overseas earnings to turn a profit. However, compared to the box office performance of films released by other Hollywood studios in the months leading up to the summer season, this was still an impressive result.
Additionally, thanks to Daenerys Entertainment's public relations efforts and the film's involvement of Jet Li and other Chinese stars, Taken had been confirmed for release in mainland China in the second half of the year.
Bridget Jones's Diary, released on Valentine's Day in February, officially ended its run on May 15, with a cumulative domestic box office of $145 million. The film's overseas release was still ongoing and was expected to surpass $200 million, with a global total conservatively estimated at around $350 million.
With a production budget of $30 million and $15 million in marketing, a global gross of $350 million made Bridget Jones's Diary one of the most profitable films in recent years.
The other two small films released around the same time—Christopher Nolan's Following and Guy Ritchie's Lock, Stock and Two Smoking Barrels—had also ended their runs.
Domestically, Following had grossed $34.61 million, while Lock, Stock and Two Smoking Barrels had grossed $43.76 million. With a combined budget of only $5 million, both films were considered rare successes.
In addition to these main releases, in the 19 weeks leading up to the 1997 summer season, Daenerys Entertainment had also released other films such as Iron Monkey. Combined with the box office earnings from films released at the end of 1996 that carried over into 1997, Daenerys Entertainment alone had accounted for $670 million of the $1.54 billion domestic box office during this period, representing a 43% market share.
This was despite the fact that Daenerys Entertainment had only released Good Will Hunting during the previous Christmas season, and co-productions like Jumanji and Charlie's Angels weren't included in the tally. Additionally, there had been the re-release of the Star Wars series earlier in the year. It was clear that with the summer and year-end releases, Daenerys Entertainment's films were likely to account for over 50% of the North American box office in 1997, truly dominating the market.
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