Chapter Forty-One: The Heritage of a Great Family, It Turns Out I Am the Privilege

Outside the bailiff's office, Zhang Xiaolong expressed his heartfelt gratitude to Yan Fei and Liu Zhe.

Liu Zhe looked at the two and said, "I will handle the matters that follow. You should take your friend to a hotel to rest for now."

"Thank you, Uncle Liu!" Yan Fei replied. He drove Zhang Xiaolong to a nearby hotel, while Liu Zhe, under the escort of Captain Zhang, returned home.

The next day, Liu Zhe made a phone call to the Secretary of the Political and Legal Affairs Commission of Shen'an. He tactfully suggested that the dispute between the two enterprises should be resolved through normal commercial competition and that no other factors should be involved.

Upon hearing Liu Zhe's suggestion, the Secretary promised to handle the matter seriously. After hanging up, he immediately gave the Director of the Shennan Branch, Director Chen, a stern reprimand, informing him that Yan Fei was a son-in-law recognized by the Liu family and that he should not interfere in the commercial rivalry between the Big Penguin conglomerate and Yan Fei.

Only after understanding the context did Director Chen realize he had been played by Big Penguin. It was no wonder they hadn't let him arrest Yan Fei directly in Shen'an, but instead had requested a cross-city arrest warrant for Zhang Xiaolong.

By this time, Yan Fei had already sent Zhang Xiaolong back to Guangzhou. At their parting, Yan Fei said in a deep voice, "I am sorry for the trouble you've been through, Mr. Zhang. We will certainly make up for this loss in the future."

Zhang Xiaolong nodded solemnly, his expression cold. "Rest assured, Mr. Yan. The fire of revenge is already burning in my heart. Big Penguin will soon face our storm."

Yan Fei patted Zhang Xiaolong on the shoulder and said earnestly, "Go ahead and do it. Whatever happens, I will be the one backing you."

After returning to Shen'an, Yan Fei felt exhausted. He collapsed onto his bed and fell asleep, not waking until the evening. After a simple meal, he continued his international futures trading, using the dollars he earned to continue buying Apple stock.

At three in the morning, Yan Fei's phone rang. Pressing the speakerphone, he said in a low voice, "Ms. Chen, good evening—oh, good day! I forgot it’s daytime on your end."

Ms. Chen giggled, her soft voice coming through the line. "Mr. Yan, our company will be holding its annual meeting in mid-November. As one of our major clients and a new-generation investment genius, we would like to invite you to attend and give a speech."

Hearing this, Yan Fei thought of the promising companies founded in the U.S. in 2009, such as Uber, WhatsApp, Slack, and Square. Intending to invest, he replied happily, "Of course, I will be there on time."

After a short chat, Yan Fei hung up. The following days passed uneventfully until November 8th, when he received a call from Shen Qianyun. His expression turned incredibly serious.

After listening to Shen Qianyun, Yan Fei said in a deep voice, "So, you mean Big Penguin has crossed the line again? A short squeeze is no longer possible, and it has already attracted the attention and inquiries of the exchange."

Shen Qianyun nodded, his expression grim. "That’s right. Previously, Big Penguin put up 500 million in margin. Every time we pushed the price up by 10%, they added more margin until it reached 4 billion. Suddenly, they crossed the line; massive short-selling capital flooded in, and all the other bulls in the market liquidated their positions. Now, only our 120,000 long positions remain, while Big Penguin holds 180,000 short positions. The market is essentially just us against them."

After a moment of thought, Yan Fei asked, "What does the Zhengzhou Exchange say?"

Shen Qianyun replied gravely, "The exchange told us to control our positions and liquidate the excess, or they will force a liquidation."

Yan Fei nodded, as this was within his expectations. He said calmly, "The current price of sugar futures has deviated significantly from the market price. Trading volume has plummeted while open interest continues to climb; it’s hard for the exchange not to notice. Their approach is fair and compliant. You don't need to worry, Shen, just follow the plan. No matter how much capital Big Penguin has, they can't drive the price down without a counterparty. We just need to hold firm, let them liquidate first, and at the same time, use the set of accounts I prepared to take over your positions. It won't be easy for Big Penguin to change their strategy while they are in the spotlight. A short squeeze is inevitable."

Upon hearing this, Shen Qianyun felt a sense of relief, as if he had survived a disaster. He was deeply shocked and awed by Yan Fei’s foresight, secretly glad he hadn't sided with Big Penguin; otherwise, Yan Fei’s "pulling the firewood from under the cauldron" strategy would have caused him massive losses.

Neither Big Penguin nor Shen Qianyun realized that Yan Fei, who had remained invisible throughout, was the true grandmaster controlling the board, while they were merely pawns who never stood a chance of harming him.

At this point, Big Penguin had yet to realize the terror of a trading genius. Zhang Zhenguang looked at Ma Teng with excitement, awaiting orders on whether to execute the exchange's warning letter.

After a long pause, Ma Teng asked, "What will happen if we ignore the exchange?"

Zhang Zhenguang immediately replied, "We can use our capital and short positions to engage in wash trading, driving the sugar futures price down continuously. This won't just force Shen Qianyun into a margin call; it will also force Yan Fei into one."

Hearing that he could force Yan Fei into a margin call, Ma Teng thought of the series of humiliations he had suffered—how Yan Fei had used the Liu family’s influence to take Zhang Xiaolong away, ruining his plan to strike at WeChat Technology, and how his international efforts to uncover Yan Fei’s trading data had consistently failed. These setbacks fueled Ma Teng’s hatred for Yan Fei to a breaking point.

With an angry snort, Ma Teng said, "Do as you said. Ignore the exchange’s warning."

Upon receiving the order, Zhang Zhenguang excitedly directed his traders to execute wash trades and began suppressing the price of sugar futures.

In the villa district of Nanning, Shen Qianyun looked at the batch of trading accounts provided by Yan Fei, which contained 300 million in funds. He immediately directed his traders to use these accounts to engage in counter-trading, driving the price of sugar futures up.

Both Big Penguin and Shen Qianyun ignored the exchange's warnings, using the same tactics to wage a fierce battle that instantly excited countless retail investors and institutions watching the sugar futures market.

In a sugar futures community, one investor posted: "This is spectacular! Two giants going head-to-head—a once-in-a-millennium event! Grab your popcorn!"

Almost instantly, another netizen commented: "You're right! Both giants are ignoring the exchange's warnings and fighting fiercely. This is truly a rare sight in history!"

"Speak carefully!" another netizen replied. "Don't rub salt in the wound. The exchange has already lost face; let's not add fuel to the fire."

As more retail and institutional players joined the fray to watch, the sugar futures market became increasingly lively. Prices fluctuated wildly, catching the attention of more and more netizens.

At the Zhengzhou Exchange, several committee members stared at the sugar futures screen, their faces ghastly. A heavy, angry atmosphere filled the meeting room.

After a brief silence, Committee Member Song spoke up: "Gentlemen, the exchange is being grilled over a fire. Should we force a liquidation of their positions? Let’s hear your thoughts."

Committee Member Zhao said in a deep voice, "I suggest we issue an immediate liquidation warning. Liquidate part of their positions first. If they refuse to comply, continue liquidating until they are in compliance."

The other members remained silent. After a long while, Committee Member Li stood up and said, "I don't need to say much about Big Penguin. As for Shen Qianyun, he is not only the 'Sugar King' of Guangxi but also a member of the Shen family. It’s hard for us to offend either side."

Most members knew this and looked at Chairman Zhou, who sat at the head of the table. Feeling their gazes, Chairman Zhou scanned the room and said firmly, "Issue another warning. Either liquidate or pay a fine—let them choose."

Following the issuance of the warning letter, in Big Penguin's office, Ma Teng looked at Zhang Zhenguang and asked coldly, "If we liquidate now, how much will we lose?"

Zhang Zhenguang quickly calculated and replied, "If we liquidate the excess positions, we will lose about 600 million. Furthermore, we will continue to be squeezed afterward. Even if we hold until the delivery date at the current price, our total loss will reach around 2 billion."

Ma Teng’s face twitched. He said coldly, "I invested 5 billion, and you tell me we’ll lose 2 billion? Is this your answer to me?"

Zhang Zhenguang replied in a panic, "Boss, it’s not that our skills are lacking; it’s that the enemy is too strong. Between a trading genius and the 'Sugar King' of Guangxi, either one could crush us!"

"Useless! Trash!" Ma Teng roared. He took a deep breath, calmed his anger, and asked, "What if we just pay the fine?"

Zhang Zhenguang responded immediately, "Boss, it is highly likely we won't be profitable anyway. The fine won't affect us much; the maximum is only 5 million."

After understanding the situation, Ma Teng said, "Keep suppressing the price. Make it more intense. Ignore the exchange's warning letter."

In Nanning, after receiving the warning letter, Shen Qianyun immediately called Yan Fei. After hearing the report, Yan Fei said calmly, "Mr. Shen, Big Penguin will definitely ignore the exchange's warning, and their counterattack will be even more intense. We will ignore it as well. Don't worry about the penalties; I will handle that later."

Reassured, Shen Qianyun went all out, ordering his traders to engage in aggressive wash trading to drive up the price, clashing even more violently with Big Penguin.

Well-informed individuals immediately posted news of the second warning letter in the community, drawing countless onlookers who mocked the exchange’s incompetence, effectively slapping its face again.

Back in the exchange meeting room, the committee members gathered once more, their faces livid as they stared at Chairman Zhou. Heavy pressure and anger filled the Chairman as well.

After a long silence, Chairman Zhou slammed his fist on the table and roared, "Proceed with forced liquidation immediately! Issue the penalty notice!"

Committee Member Wang stood up and said, "Chairman Zhou, please reconsider! If both sides retaliate and exert pressure afterward, I fear your career will be ruined."

Chairman Zhou waved his hand, his expression solemn. "The dignity and face of this exchange cannot be sacrificed. I will take full responsibility for everything. Execute the order!"

The committee members looked at Chairman Zhou with admiration and began to carry out his order. In an instant, a massive volume of trade orders appeared in the sugar futures market; 80,000 short orders and long orders were matched in a single second.

Countless retail investors and institutions watching the screen saw this unprecedented, historic volume bar and instantly realized the exchange had forced a liquidation of the illegal positions, releasing 160,000 long and short contracts into the market.

Seeing this, many institutions and retail traders jumped in. Everyone understood that the peak of the battle had arrived. The forced liquidation was only the beginning; the real squeeze was yet to come.

Thinking they could profit from the chaos, many institutions and retail traders took sides, some going long and others short, making the sugar futures market instantly vibrant. Countless small orders were matched, and volume began to grow steadily.

Yan Fei sat in front of his computer, looking at the historic volume bar. A faint smile appeared on his face. He whispered to himself, "Big Penguin, that 600 million is just the interest. The real show has only just begun. The climax is still ahead—don't disappoint me."

At Penguin Tower, Zhang Zhenguang watched his liquidated positions and collapsed to the floor. The other traders were ashen-faced, staring blankly at the sugar futures market on their screens.

Ma Teng sat in his chair, silent for a long time. Ten minutes later, he said in a deep voice, "If we are squeezed, what options do we have?"

A glimmer of hope returned to Zhang Zhenguang's eyes. "Two choices. First, hold until the delivery date and accept the loss. Second, use spot trading and apply to cancel the positions."

"Which one results in smaller losses?"

"With spot trading, we would lose about 500 million. If we hold the futures contracts until maturity, we would lose about 1.4 billion. The problem is that there isn't enough spot supply in the market for us to buy, so we can only settle the majority through futures contracts."

Ma Teng rubbed his temples. "Keep suppressing the price within the scope of compliance. Don't worry about the rest for now."

Leaving the investment room, Ma Teng made a phone call. "Go and talk to Shen Qianyun for me. Tell him Big Penguin accepts the loss this time. Ask him to name his price."

Committee Member Wang agreed and arrived at Shen Qianyun's office that afternoon. He smiled and said, "Mr. Shen, for my sake, let this battle end here. After all, there’s no real grudge between you and Big Penguin."

Shen Qianyun pondered for a moment and replied, "Big Penguin’s 1 billion chips aren't enough to convince me. If I wait a few more days, I’ll have 2 billion. There is a significant difference between the two."

After a brief silence, Committee Member Wang said, "Big Penguin’s friendship and the exchange not imposing a penalty—this is the bottom line. You should understand, Mr. Shen, that if we were to impose penalties, the scale could reach over 1 billion."

"Is this the exchange's position?" Shen Qianyun asked coldly. "Has the exchange sided with Big Penguin?"

Committee Member Wang replied calmly, "When there is no other choice, the exchange cannot afford to offend both sides. Besides, Big Penguin has suffered heavy losses. Penalizing you, Mr. Shen, is justifiable in both reason and law, and even the Shen family would have nothing to say."