The B-52 Crash That Revealed a 78-Year Aviation Legacy

Friends, September 16, 1992, a Wednesday in London. On this day, the British government raised interest rates from 10% to 12%, then hiked them to 15%, just to defend the pound. But the result? The pound collapsed. A financial fortress supposedly invincible with nearly 300 years of history, the Bank of England failed that day. The news pinned the blame on one man, George Soros. From that day on, Soros earned a world famous nickname. The man who broke the Bank of England. But today, I'm not telling you about Soros, but about the young man in Soros' office who kept shouting, not enough, double down. His name is Scott Besant. 34 years later, this man who helped break a central bank and made a fortune shorting other currencies, has become the gatekeeper of the world's most important currency, the dollar. What happened in between? Even more dramatic, Besant was once a donor for the Deep Blue Democrats, but now he's Trump's most trusted economic advisor. What happened there? It's the weekend again. Time for our storytelling. Today, we're following up to bring you the dual life of America's toughest Treasury Secretary, Scott Besant. In the American South in 1962, Besant was born in a small town called Conway, South Carolina. He was the eldest of three children. His father, Besant Sr., was among the first local real estate developers. On that coast, he was quite a prominent figure, and the family lived comfortably. But real estate has its ups and downs. When Besant was nine, his father's business collapsed. Young Besant vaguely remembers strangers entering his home, taking the beds, sofas, and chairs to pay off debts. Soon, he started working, setting up chairs and umbrellas for tourists on the beach and clearing plates in restaurants. That bankruptcy served as a painful first lesson in economics for young Besant. He later said those low points in his father's business showed him for the first time what financial hardship does to a family. As he grew up, Besant went to Yale. He studied political science, but what he really wanted to be was a journalist. He threw himself into the Yale Daily News and did quite well. In his vision, after graduation, he'd be a newsman, interviewing, writing stories, and recording The Times. However, life took a sharp turn. He ran for editor-in-chief of the school paper and lost. But soon, fate opened another window for him. He met a man named Jim Rogers. The name isn't widely known, but in investment circles, he's an absolute legend. He was Soros' earliest partner and a co-founder of the Quantum Fund. Rogers gave the young, struggling Besant an internship opportunity. Besant recalled that what moved him was Rogers offering him a sofa in the office as a place to stay. It was just a sofa like this that kept a young man who wanted to be a journalist on Wall Street. The clever Besant soon realized that finance and news are actually the same thing. They both involve gathering a ton of data and then, well, making a judgment. Except a journalist writes a report after making a judgment, while an investor takes that judgment and places a bet. After graduating, Besant officially entered Wall Street. He first did securities analysis and options trading at a Saudi family's investment firm. Later, he went to train under the famous short-selling master Jim Chanos. In 1991, he knocked on the door that would truly change his destiny. He joined Soros Fund Management. It was here that he would personally end a 300-year-old imperial bank and rise to become Soros' most powerful secret weapon. In 1992, London, Besant was only 30 years old and had just been transferred to Soros' London office. He was an overlooked young fund manager. And that year, Britain was caught in an invisible trap. At that time, Britain had joined an arrangement called the European Exchange Rate Mechanism, or ERM for short. Simply put, a bunch of European countries agreed to tie their currencies together, specifically to the German mark. No one was allowed to deviate, keeping everything within a fixed, narrow range. But the problem was, the British economy at the time was in terrible shape, in a recession. The pound clearly didn't match the actual economic environment. It was being propped up at a level that was obviously too high. This meant the pound was overvalued, like a balloon blown up too large that was bound to pop sooner or later. The sharks on Wall Street smelled blood. This was a golden opportunity to strike it rich. Chart the pound. What does it mean to short? When ordinary people buy stocks, they expect them to go up. You buy at $10 and wait for it to hit $20 before selling. That's called profiting from the price difference. Shorting is the exact opposite. You're hoping it falls. For example, you've got your eye on a stock currently worth $10, but you're certain it's going to crash. So, without spending a dime, you borrow a share from someone else, sell it, then put that $10 of cash right into your pocket. A few days later, the stock drops just as you predicted, down to $2. At that point, you spend $2 to buy a share back from the market and return it to the lender. See? It was worth $10 when you borrowed it, but only cost $2 to pay back. Through this borrowing and returning, you've easily pocketed an $8 profit. That is shorting. The pound was overvalued and bound to fall sooner or later. Yet despite this, not many on Wall Street actually dared to take a bite. Why was that? Because the opponent was the pound sterling itself, the British government. If the Bank of England were to use its foreign reserves or administrative power to keep hiking interest rates, making the pound more and more valuable, then a large-scale sell-off in the market would be impossible. By then, no matter how much money the short sellers had, they would be bled dry by the British government. But Besson happened to be the daredevil who broke the deadlock. Why did he dare? Because he did something. He didn't focus on the exchange rate market, but instead studied a small corner that no one else thought of at the time—British real estate and the mortgages of the British people. Then, he discovered a critical detail. At that time, about 90% of British mortgages floated with the overnight interest rate. In other words, if the Bank of England raised the interest rate by one point, the monthly payments of millions of ordinary British families would immediately rise by one point. So if the British government wanted to save the pound, the only way was to hike interest rates aggressively, only by raising rates with a market feel that holding pounds was profitable. But once interest rates went up, it would lead to a disaster for British real estate. Since 90% of British mortgages were floating, every rate hike meant higher monthly payments for millions of families. It was like putting a knife to the people's throats. So Besson saw through it. The British government couldn't possibly keep interest rates high for long. This judgment became the final straw that broke the pound. According to the famous financial writer Sebastian Malaby in his book More Money Than God, it was Besson's analysis of British real estate and mortgages that convinced Soros' top deputy, Druckenmiller, to short the pound. On September 16, 1992, the final battle began. Soros issued an ultimatum, telling Druckenmiller, So the Quantum Fund deployed astronomical amounts of capital to sell off the pound frantically. Soon, speculators from all over the world rushed in, swarming like a pack of sharks smelling blood. At 9.30am, the phones in the Bank of England's trading room were nearly ringing off the hook. The market was flooded with orders to sell the pound. The Bank of England had no choice but to take them head-on. For every pound sold on the market, the central bank had to buy it back using foreign reserves. An hour later, the Bank of England realized in despair that the selling pace was out of control. The foundation of foreign exchange was being aggressively swept away by the tide of capital. At 11am, in hedge fund offices in London and New York, the sounds of phones, quotes and shouting blended together. Numbers on screens jumped wildly. The pound was on the verge of collapse. The British Prime Minister and Chancellor urgently announced a rate hike, raising it from 10% to 12%. On one side were bloodshot-eyed hedge fund traders with massive bets. On the other was the Bank of England, defending desperately with national reserves. Facing the Bank of England's move, almost all of Soros' traders grew nervous. Could they really swallow it all? At the most tense and critical moment, records show it was Besant who insisted, not enough, double down, keep pressing them. One minute, two minutes, half an hour. The pound didn't bounce back. At 2.15pm, the British line of defense completely collapsed. Pushed to the brink, the government announced another rate hike, raising it from 12% to 15%. This was unprecedented in financial history. The British government was willing to risk a domestic real estate collapse to defend the pound and repel these Wall Street sharks. By 4pm, even a 15% interest rate couldn't stop the frantic sell-off. The Bank of England's vaults were empty. Billions in foreign reserves were drained by short sellers in just a few hours. That evening, the British government admitted defeat and withdrew from the ERM. The pound crashed instantly. From this battle, Soros' fund netted over $1 billion, making him a household name. But no one noticed that, in a dimly lit trading room, a 30-year-old young man took off his headphones. During the year of the pound short, Besant was just an obscure player standing in a giant shadow. But 20 years later, he would step out of the shadows to pull the trigger and take down another currency. Around 2000, Besant left Soros to go solo. He started funds, saw ups and downs. But in 2011, he returned. This time, he took the position of chief investment officer at Soros Fund Management. Then he turned his sights toward the next country, Japan. This time, the prey was the Japanese yen. At that time, the yen had been steadily strengthening for 30 consecutive years. In the minds of many traders, the yen would stay strong forever. It was an unquestioned article of faith. Plus, Japan had a massive annual trade surplus of over 10 trillion yen. A larger surplus meant higher global demand for Japanese goods, driving the yen's value up. So on Wall Street in 2012, anyone talking about shorting the yen was considered a joke. But Besant had his eye on it again. Why? In 2011, Japan suffered the devastating March 11 earthquake and tsunami. While the world watched the disaster, Besant was already crunching the numbers. With nuclear power halted, Japan had to import massive amounts of oil for electricity. Imports would surge, eating away the trade surplus. The yen's support would weaken, and its foundation began to shake. But a shaky foundation wasn't enough. It needed a final kick to bring it down. Who would deliver that kick? Shinzo Abe. In late 2012, Shinzo Abe was about to return to power as prime minister. Abe's economic policy was to have the Bank of Japan print money at full throttle. He felt Japan had suffered deflation for 20 years, and only monetary easing could revive the economy. These two factors were exactly what Besant was looking for. We all know that when there's too much currency, it loses its value. If the central bank prints money like crazy, the market supply increases, and it's bound to depreciate. Consequently, after the earthquake, the yen's trade surplus would shrink, and the foundation supporting a strong yen had already begun to loosen. On the other hand, the newly inaugurated prime minister was dead set on printing money, which was bound to cause the yen to continue depreciating. With these two forces acting together, the yen was in a situation destined to collapse. Realizing this, Besant immediately went to Soros and told him that a massive market opportunity, the kind that comes once in a lifetime, was coming. He placed a heavy bet, short in the yen. Sure enough, once Abe took office, the yen started falling like a kite with a broken string. Besant won again. In this battle, he earned $1.2 billion for Soros' fund. At this point, I want to pause and ask you all, if it were you, even if you saw such a trend, would you dare to place such a heavy bet? If you would, leave a comment saying I would. If you think it's too hard, type too hard. This shows Besant's extraordinary courage. At 30, he dared to short the British pound. In the most dangerous moments, when everyone was tense, he could still aggressively double down. Such mental toughness is rare. However, there was another very important reason for his shorting of the yen this time, and that was his research on Japan. Since the 1990s, he's traveled to Japan over 50 times. He's recognized on Wall Street as one of the people who understands Japan best. Two successful shorts, creating a legend. In the world of hedge funds, Besant is undoubtedly recognized as one of the top global macro traders. And just the three years after his second return to Soros, he earned about $10 billion for him. With someone like that, how could Soros not treat him like a prized asset? But despite being such a seemingly perfect partner, they eventually went their separate ways. In 2015, Besant left Soros once again. It's said he had a very unpleasant relationship with Soros and his son, leaving with a lot of frustration. He started his own fund called KeySquare. Initially, Soros invested $2 billion in it, but he withdrew it a few years later. Since then, the two have had almost no contact. Besant and Soros' split wasn't just a business farewell. It was more like a signal. Because next, Besant was about to place the boldest bet of his life at a table Soros never could have imagined. Besant was originally a staunch liberal, a standard deep blue on Wall Street. As early as the year 2000, he held a fundraiser for Democratic presidential candidate Al Gore in the Hamptons, a place where America's wealthy congregate. Later, he even became a behind-the-scenes donor for Hillary and Obama. But this former Democratic financier has now actually become Trump's most trusted economic advisor. So what happened in between? There's a human element to this. Besant has a 30-year relationship with the Trump family. But it didn't start with Trump himself, but with his brother, Robert Trump. Robert was also an investor, and he and Besant were longtime friends. How close were they? Robert Trump's ex-wife is the godmother of Besant's daughter. See, this isn't just a professional acquaintance. They're practically family with a bond that's almost like kin. So when Trump entered the political arena, Besant saw the brother of an old friend he'd known for 30 years. Beyond family ties, there's also Besant's own sharp judgment. Besant once said he sees Trump as a stock that rises on bad news because every devastating blow only makes his approval ratings climb. In his eyes, this wasn't a hot potato at all, but a severely undervalued growth stock that was quietly surging. So while most of Wall Street was distancing itself from Trump, he did what he does best. He went all in. He said on a TV program, I'm betting everything on Trump. In February 2024, during the South Carolina primary in his home state, he personally organized a fundraiser for Trump. Most importantly, many of his policy positions are perfectly aligned with Trump's. Before the 2024 election, he wrote an op-ed in The Economist taking aim at globalization. His core argument was that decades of globalization have created a widening wealth gap, making Western middle-class workers increasingly resentful and wary. To preserve the benefits of free trade, we must confront and correct those long-held mistaken assumptions. How to fix it? One of the remedies he proposed was, in fact, tariffs. And so with 30 years of family ties, his sharp trader's intuition, and his reflections on the past, you'll see that Besant's bet on Trump follows the same logic as his legendary bets on the pound and the yen. Identify the trend, weigh it against current market conditions, and even if public opinion is against you, it's worth making the biggest bet. And this time, he won his gamble once again. In November 2024, Trump won the election and soon after nominated Besant to be the U.S. Treasury Secretary. This Wall Street titan, who spent the first half of his career aggressively shorting central banks, will spend the second half guarding the dollar, moving from market disruptor to gatekeeper. If you look past the surface and see the man himself, you'll find that Besant possesses a profound sense of solitary courage. Wall Street has no shortage of brilliant minds, but Besant has an admirable quality, the ultimate courage to act on his convictions. Once he's sure, he never looks back, possessing the steely resolve to forge ahead even when the world is against him. Whether shorting the pound against the state machinery at 30 or going all in when global elites were bashing Trump. All right, that's the two sides of Besant's life we've brought you today. What do you think of Besant's life so far? Comment below. If you like my show, don't forget to give a like before you leave. New friends, please subscribe to ZhenGuanDian to see my new videos on your YouTube homepage. Please also share my show with friends. This helps trigger YouTube's recommendation algorithm so more people can hear my voice. Thanks in advance. All right, that's all for today. See you Tuesday at the same time on ZhenGuanDian. Bye-bye.