1 June 2024

1 June 2024

 

When we were younger, we watched a lot of cyber and technology movies, many we call them AI now. The story lines are usually about money, power struggle, or world domination.  Those story lines seem to be science fiction, but as we grow older, many of the once-sci-fi gadgets are here with us.  Imagine you value-added $300 on one e-wallet in order to pay for a certain fee at school. On your way to school, your mother facetimed you and asked you to transfer her this $300, for she would give you HK$500 on another e-wallet.  You obeyed, only to find out that that was not your mother at all. You know the story.  Not only did it affect your information and valuables on your phone, but you had nothing to pay with at school.

 

If we are not talking about $300, but $300 billion, you can easily imagine how devastating it is to a city or a country.  According to the government, the definition of “financial security refers to a state in which the financial system of a country is resilient to internal and external impacts, the financial sovereignty is relatively free from dangers and threats, the financial system and the relevant economic entities can maintain smooth operation and other national interests are free from threats posed by dangers caused by financial means or regulations”. Note that the same word “security” could mean bond or collateral, so “financial security” in that sense could mean contracts for different trades of assets.  Of course, if it is bond fraud, it goes under first definition of the financial security.

 

Even if we do not go into sophisticated theories, we can easily understand how an unstable financial market can cripple economy and everyday life. Resources become scarce for there is no trades; the differences and hatred between the haves and the have-nots become more obvious;  the ability to bounce back is thinned out. Now imagined it was a country deliberately crippling another country through financial measures. This is different from the financial crisis, for example the global one in 2007 onwards; one is manmade attack, the other is usual business gone wrong, too wrong.  If a country plans well and has a healthy reserve, then it can ride it out eventually; otherwise, the country faces both internal and external chaos.

 

Many of us save money, for future or for rainy days. In addition to savings, I put away a banknote next to my ID card, just in case. Consider it my emergency reserves.

 

Anson Yang