In Hong Kong, we build a global business empire

After learning of Forbes' actions, Lin Haoran did not take any action.

For him, the real show is just beginning.

December 29th, 8:00 AM.

In the living room on the third floor of the Shi Xundao villa, the curtains were drawn back, and the morning sunlight immediately filled the entire living room.

Lin Haoran had just gotten up and hadn't had breakfast yet when the landline next to the sofa rang.

The caller ID showed the New York area code.

He pressed the answer button, but it was Su Zhixue calling: "Boss, good morning! I'm sorry to bother you so early, but something very interesting has happened here, and I feel I must report it to you immediately."

"Oh? Zhixue, what is it?" Lin Haoran took the telephone receiver, walked to the window, glanced at the neatly trimmed lawn in the courtyard, and said with a smile.

“It’s about MIT and Harvard.” Su Zhixue took a deep breath, seemingly organizing his thoughts. “We at Huanyu Investment have some research institutions and contacts in Boston, and they sent us this message.”

Recently, a spontaneous organization or trend of thought has emerged on the campuses of two universities, particularly among students majoring in economics, finance, and business. They call themselves "Lin Men" (林门).

"Lin Clan?" Lin Haoran raised an eyebrow slightly, the term surprising him.

He knew that his previous speech at MIT had sparked some discussion, and that he had even been praised by some media outlets after the US stock market crash, but the term "Lin's School," which carries a clear connotation of a school of thought or followers, still exceeded his expectations.

“Yes, ‘Lin Men’,” Su Zhixue affirmed.

"As far as we know, it was initially initiated by several graduate students who had studied your views on high interest rates, market risks, corporate profit pressures, and global capital flows either during or after your speech."

They meet regularly to discuss your views and try to use these frameworks to analyze current economic data and market phenomena, especially to verify your prediction logic for a decline in US stocks.

Subsequently, they applied directly to have 'Linmen' become a student club, and even found several well-known economics professors as advisors, and surprisingly, they were approved by the school!

Now, 'Linmen' is a registered and legitimate student organization affiliated with both Harvard Business School and MIT Sloan School of Management.

Meanwhile, because your reputation is growing in the United States, it's said that more and more students are applying to join 'Linmen'.

Su Zhixue paused, then added more specific details: "They even compiled an informal 'Collection of Lin's Views,' which circulated privately."

The content is mainly based on your public speeches and your assessment of the economic situation as quoted in some subsequent media reports.

The key point is that these young people are very serious. They are not just admiring each other, but rather engaging in an academic discussion and practical simulation.

Several core members have even tried using your analytical framework in demo accounts or small-scale live trading, and reportedly with quite good results.

Lin Haoran listened quietly, feeling a mix of amusement and exasperation.

This was completely unexpected for him.

He anticipated that his remarks would spark discussion and even debate among professionals, but he never imagined that they would give rise to a kind of "factional" following phenomenon in top universities.

This is less about idolizing him personally and more about recognizing the rigorous logic of his analytical methods, which have been initially validated by the market.

“Interesting.” Lin Haoran finally spoke, his voice devoid of much emotion. “What was the main point of their discussion, besides verifying my point of view?”

“According to the information we have received,” Su Zhixue replied, “they are currently most interested in two topics: one is to explore in depth the issue of ‘revaluation of corporate valuation models in a high-interest-rate environment’ that you raised, and try to establish a more refined quantitative model;

Secondly, they seem very interested in how you anticipate these risks and how you build your portfolio to hedge them.

Some people are even trying to reverse-engineer your asset allocation strategy.

A barely perceptible smile appeared on Lin Haoran's lips.

These young people from the top ivory towers have a keen sense of smell.

However, these people who want to study him to find out how he made the right judgment will probably never get the answer.

After all, only he knew that his judgment that the US stock market would inevitably fall was based on historical trajectories he knew from his previous life, combined with cross-validation of current economic data.

This is an unreplicable "prophetic" advantage, stemming from his soul from the future.

Of course, he would never tell anyone this secret.

To outsiders, this was his extraordinary insight and talent.

"Furthermore, as far as I know, the founder of 'Linmen' was five students, and 'Linmen' regards you, Boss, as its core spiritual leader."

They originally wanted to invite you, boss, but considering that 'Linmen' was just established and its influence was still small, and that you were in such a far place as Hong Kong, they temporarily shelved the idea.

However, they didn't seem to give up, and continued to try to learn more details about you beyond the publicly available information, especially your plans outside of Hong Kong, through their own channels. Su Zhixue continued his report, his tone tinged with admiration for the perseverance of these young people.

"Five founders?" Lin Haoran asked.

"Yes, based on what we know so far, four of the core five are from MIT and one is from Harvard University, and two of them are of Asian descent."

"These five people come from diverse backgrounds, but all are from the economics or business schools of two different universities. They came together because of their shared interest in your views, and because of your comments, they made a fortune by investing in US stocks in advance," Su Zhixue replied.

"Okay, I understand. If there's nothing else, I'll hang up now. It's getting late in America, so you should go back and spend time with your wife and children," Lin Haoran said with a smile.

Previously, when Lin Haoran went to the United States, he learned that Su Zhixue had given birth to another daughter, who had just turned one month old. On the occasion of the one-month celebration, Lin Haoran specially sent a "big red envelope".

It's a little past eight in the morning in Hong Kong, but it's already evening in New York.

"Thank you for your concern, boss! It is indeed getting late, and the little one at home is probably making a fuss again." Su Zhixue's voice carried a gentle smile, typical of a father. "Then I'll stop my report here for now."

I will continue to follow the situation at 'Linmen' and will report back to you with any significant developments. I wish you all the best in Hong Kong, boss!

"Yeah, you too, take care and get some rest." Lin Haoran said and hung up the phone.

The receiver was put back on the landline, and the living room returned to silence.

Lin Haoran stood by the window, not immediately returning to the sofa.

The morning sunlight streamed through the glass, warmly bathing me, and the greenery in the courtyard soothed my mood.

The "Lin Men" consisted of five founding students who made huge profits in the US stock market by trusting his judgment and regarded him as their spiritual leader...

"interesting!"

These thoughts swirled in his mind.

The development trajectory and potential of this unexpectedly born student club are indeed thought-provoking.

In particular, the five core members were able to make independent judgments and make decisive bets when the market was generally skeptical. Their mindset and courage have surpassed that of most people.

If they can grow up smoothly in the future, they will surely be extraordinary.

Their gathering under the banner of "Linmen," bound together by the study of his ideas, contains countless possibilities in itself.

Perhaps, this will truly become a seed, growing into an unexpectedly towering tree in the future.

However, these are ultimately long-term and uncertain foreshadowings.

Lin Haoran quickly brought his thoughts back to the present.

Right now, Hong Kong is the stage where he needs to focus all his attention.

Lin Haoran was already very excited after learning about Forbes's actions.

Hong Kong's real estate crisis was bound to erupt sooner or later, and it's not bad that it's erupting now, after all, his various groups now have a lot of cash flow.

Besides investing overseas, holding more properties in prime locations in Hong Kong is also a good strategic move.

"Haoran, what's wrong?" At this moment, Guo Xiaohan came out of the bedroom yawning.

Wearing sexy pajamas, she exuded a charming and alluring aura.

The morning light outlined her exquisite curves, her languidness tinged with the innocent charm of someone just awakening.

She walked behind Lin Haoran, stretched out her arms, gently wrapped them around his waist, and pressed her cheek against his broad back.

Feeling the warmth and softness coming from behind him, Lin Haoran's worries were instantly washed away by the tenderness.

He turned around, pulled Guo Xiaohan into his arms, and gently kissed her smooth forehead.

"It's nothing, just a work call from the US." Lin Haoran inhaled the fragrance of her hair, his tone relaxed. "Did I wake you up?"

"No, I should have woken up by now." Guo Xiaohan snuggled against him like a lazy cat. "I just saw you standing here in a daze and thought you had something on your mind."

Last night, my uncle told me that the economy is bad lately, and it seems like the Hong Kong real estate market is going to have problems…

As the richest man in Southeast Asia, Guo Henan obviously received news from the United States yesterday that Forbes was going to publish some articles that were unfavorable to Hong Kong's real estate economy.

Therefore, it's quite normal for him to tell his niece, Guo Xiaohan, about this.

She looked up, a hint of worry in her bright eyes.

Although she never inquired about Lin Haoran's work, she knew that he owned many properties in Hong Kong, and upon learning this, she still instinctively felt concerned.

Looking into her clear and concerned eyes, Lin Haoran felt even warmer inside.

He pinched her delicate cheek and smiled, "Don't worry, your brother Haoran has already made preparations. No matter how big the storm is outside, our home is as stable as Mount Tai."

His tone was firm and confident, carrying a reassuring power.

Looking into his deep, smiling eyes, Guo Xiaohan's worries vanished instantly, leaving only a deep sense of dependence and sweetness.

She nodded vigorously: "Yes! I believe you!"

"Let's go out onto the terrace. The sun is shining brightly today. Have the servants bring up breakfast," Lin Haoran said with a smile.

"I'm going to wash up first."

In late December in Hong Kong, the temperature was below 20 degrees Celsius, but the sun still generously shone on the terrace of the villa on Sham Road.

Under the white parasol, Lin Haoran, dressed in comfortable linen loungewear, sat opposite Guo Xiaohan. On the mahogany coffee table in front of them were a pot of fine Pu'er tea, several plates of exquisite Cantonese dim sum, and a few copies of the morning newspaper that had just been delivered.

Just as Lin Haoran had expected, some mainstream media in Hong Kong had also received the news, and the headlines on the front pages of their newspapers were even more shocking.

Forbes issues a startling warning: Hong Kong's real estate "perfect storm" countdown begins! "Cracks beneath the illusion of prosperity: International authorities point to hidden economic concerns in Hong Kong"

"The risk of a real estate collapse has surged; where should investors go?"

Forbes predicts that Hong Kong's real estate market is about to collapse!

The bold, striking headline dominated the front pages of almost all major newspapers, including the Hong Kong Commercial Daily, Sing Tao Daily, Ming Pao, and Oriental Daily News.

The accompanying images were either silhouettes of skyscrapers under a gloomy sky or charts of a stock market crash, creating an exceptionally oppressive atmosphere.

The fact that the Oriental Daily News reported on this matter was naturally with Lin Haoran's approval.

He had already instructed Cui Zilong to just report as usual and not to have any reservations.

Guo Xiaohan picked up a copy of the Hong Kong Economic Journal, looked at the summary of the core content of the Forbes article reprinted on it, her eyebrows furrowed slightly again, and she subconsciously looked at Lin Haoran.

Lin Haoran, however, remained calm and even leisurely picked up the small purple clay teacup, gently blew away the foam, and took a sip.

The rich aroma of tea melted in his mouth. He put down his teacup, picked up the copy of the Oriental Daily, and calmly glanced at the sensational words.

"Forbes has surprisingly told a lot of the truth this time. The data they found is quite accurate, and the logic is basically sound," Lin Haoran said with a smile.

He already knew what Forbes was going to publish yesterday, and he had long anticipated that the Hong Kong media would report on it extensively.

After all, the media cares about traffic. If they don't report such big news, other media outlets will. They don't care about the fate of Hong Kong's real estate industry.

"Won't that affect Landsea Group and the others?" Guo Xiaohan put down her newspaper, somewhat worried.

She knew that Lin Haoran's business empire was deeply rooted, but anyone would feel uneasy in the face of such a "systemic risk" assertion.

Lin Haoran turned to the financial section of the newspaper, where local analysts had already begun to follow suit with their comments, each one more pessimistic than the last.

He pointed to one of the paragraphs: "Look, it says here that 'most real estate companies have a debt ratio of over 70% and tight cash flow' and 'bank mortgage loan valuations continue to decline.' These are facts, but in the past, everyone tacitly agreed or selectively ignored them."

Now that it's been exposed by an influential media outlet like Forbes, the fig leaf is gone, and panic is naturally ensuing.

He paused, looked at Guo Xiaohan, and explained with a smile, "As for the impact, don't worry. Do you remember how Hongkong Land sold off many projects a year ago? At that time, I had already recovered a lot of funds, so even if a real estate crisis really occurs in Hong Kong, it won't have any impact on me!"

Indeed, when Hongkong Land Group was selling off some of its real estate properties, she was still learning about business from her uncle, so she naturally had some understanding of the matter.

Hearing Lin Haoran's explanation, Guo Xiaohan finally felt relieved.

Yes, more than a year ago, when the market was at its most frenzied, Hongkong Land quietly sold off a large number of projects in non-core locations, raising a huge amount of money.

At the time, she privately wondered why she should sell the property when the market was at its best.
Looking back now, it seems that Haoran's vision has already reached a distant place that ordinary people cannot reach.

"So you knew it all along..." Her eyes shone with admiration.

"It wasn't something we anticipated, it was something we prepared for," Lin Haoran corrected, his tone gentle. "The market has cycles; after it overheats, it will inevitably cool down. That's the law."

I simply noticed the pattern a little earlier than others and took preventative measures in advance.

He put down his teacup, his gaze fixed on the seagulls circling above Victoria Harbour in the distance. His voice was calm, yet carried a detached understanding of the world: "This Forbes article is merely tearing down the window paper that everyone knows but dares not say."

Now, the real show begins.

Just as Lin Haoran had predicted, the Forbes report, with its extensive reprints, interpretations, and embellishments by local Hong Kong media, exploded like cold water thrown into boiling oil.

Panic spread at an alarming rate.

The Hang Seng Index opened more than 3% lower that morning.

The real estate sector was hit particularly hard, with several leading real estate stocks such as Cheung Kong Holdings, Sun Hung Kai Properties, and Henderson Land Development all plummeting by more than 5% at the opening.

Small and medium-sized real estate stocks fared even worse, with many falling by more than 10% in less than half an hour after the market opened.

Banking, construction, and building materials stocks were also severely dragged down, and the market was in a state of utter despair.

Inside the trading hall, the electronic price display screens, indicating a decline, were so bright they hurt the eyes.

Brokers were overwhelmed with calls, almost all of them from panicked sell orders.

The once bustling and noisy hall was now shrouded in a suffocating sense of panic and despair, with only occasional sighs and curses.

"I can't hold on any longer! It's dropped another 5%!"

"Liquidate! Liquidate all positions!"

"Even Forbes has said so, this time it's really over!"

The share prices of real estate giants including Cheung Kong Holdings, Sun Hung Kai Properties, New World Development, Hopewell Holdings, Swire Properties, and Carnegie Mellon Group all fell sharply after the market opened, showing no signs of rebounding.

Selling orders flooded in like a tidal wave, while buying orders were few and far between, creating a one-sided stampede.

Even Hutchison Whampoa, under Lin Haoran's control, was affected, but because Lin Haoran had become the owner, the stock price was not as severely impacted as that of other real estate companies.

However, Lin Haoran didn't seem to care about the decline in Hutchison Whampoa's stock price.

After all, he had no intention of increasing his holdings, and Hutchison Whampoa did not need to raise external financing, so he did not really care about the share price of Hutchison Whampoa.

Not only the stock market, but the real estate market also froze instantly.

Real estate agencies are deserted; where there used to be a few prospective buyers, now even the phone inquiries have almost stopped.

Some homeowners, eager to cash out, have lowered their asking prices again and again, but still no one is interested.

The market liquidity seemed to have been completely drained overnight.

Faced with such a surging wave of public opinion and market panic, several giants in Hong Kong's real estate industry could no longer sit still.

That afternoon, Li Ka-shing of Cheung Kong Holdings, Kwok Tak-shing of Sun Hung Kai Properties, Li Chiu-kei of Henderson Land Development, Cheng Yuk-tung of New World Development, and Chen Songqing, chairman of the recently troubled Caring Group, among others, unusually spoke out through various channels in an attempt to stabilize market sentiment.

In an emergency interview with the Hong Kong Commercial Daily, Li Jiacheng stated, "Hong Kong's economic fundamentals remain sound, and the short-term adjustment in the real estate market is a normal phenomenon. Citizens do not need to panic excessively."

Cheung Kong Holdings has a healthy financial position, ample cash flow, and strong confidence in the future.

Guo Desheng, through Sun Hung Kai Properties, issued an announcement emphasizing that the group's "debt ratio is at a low level in the industry, it holds a large number of high-quality rental properties, and its cash flow is stable enough to withstand market fluctuations."

At a special shareholders' meeting of Henderson Land Development, Li Zhaoji reassured investors: "The Group had foreseen market risks and adopted prudent financial strategies in advance."

The current stock price decline is largely driven by sentiment and has deviated significantly from its intrinsic value.

Zheng Yutong was even more vehement, telling a reporter from Sing Tao Daily: "The Forbes report is biased; it only sees the problems and ignores Hong Kong's unique advantages and resilience."

New World Development has cultivated a strong foundation in Hong Kong for many years and will never be swayed by temporary market noise.

Even Chen Songqing, who was overwhelmed with problems, mustered his spirits and declared to the outside world: "Jianing Group is actively disposing of non-core assets and optimizing its debt structure, and is confident in overcoming the current difficulties."

The long-term positive trend of Hong Kong's real estate market remains unchanged.

However, the joint appeals for "stability maintenance" from these bigwigs appeared pale and powerless in the face of Forbes' report, which was rich in data, logically rigorous, and endorsed by international authorities.

Citizens and investors are more willing to believe cold, hard data and rigorous reasoning than optimistic statements from business leaders driven by self-interest.

More importantly, the Forbes report's mention of high debt, price bubbles, and low rental yields accurately hit the market's sore spots.

For many older Hong Kong residents who experienced the devastating bursting of the real estate bubble in 1973-74, the deep-seated fears of the past have been rekindled.

That crisis caused housing prices to plummet by more than 70%, the wealth of countless middle-class families to evaporate, and the tragic scenes of businesses going bankrupt are still vivid in our minds.

"It looks like a 1973 remake!"

"That's how it was back then. The experts all said it was nothing, but I fell so badly that even my mother didn't recognize me!"

"If even major foreign magazines are saying this, it's probably even more serious!"

Similar comments quickly spread among tea restaurants, office buildings, and street vendors.

Panic, like a plague, spread from the financial markets to the hearts of ordinary citizens.

Potential buyers who were originally interested in "buying at the bottom" or waiting and seeing have completely given up on the idea and are now holding cash and waiting.

The sellers' psychological defenses gradually crumbled amid the continued lack of interest and increasingly pessimistic expectations.

Real estate transactions in Hong Kong nearly dropped to zero within just 48 hours of the Forbes report being released.

The market has fallen into a state of extreme liquidity shortage and frozen confidence.

This pervasive panic and stagnation, in turn, further exacerbated the self-fulfilling nature of the crisis.

Banks are even more reluctant to lend, and debt collection is becoming more stringent;
Suppliers are tightening credit terms and even demanding cash on delivery.
Small and medium-sized developers who rely on sales revenue and rental income are experiencing a rapid depletion of cash flow;
Some already shaky, highly leveraged companies, such as "Yongtai Construction" and "Changsheng Real Estate," were pushed to the brink of collapse after news of banks formally demanding repayment and bill holders jointly pressuring them was "timely" exposed by the media.

A vicious cycle has already formed.

Faced with the sudden surge of panic, real estate giants issued urgent statements, market transactions were frozen, and panic spread like wildfire...

Hong Kong seemed to have been pushed to the edge of a cliff overnight.

However, amidst this gloomy and desolate atmosphere, one person stood out from the crowd.

On the evening of the 29th, on the terrace of Shi Xun Road villa, Lin Haoran calmly sipped his tea and watched the stunning sunset over Victoria Harbour.

He didn't go out today because he knew there must be a "storm" outside.

He even had the leisure to pick up a delicate coconut cake, savor it carefully, and then smiled at Guo Xiaohan, saying, "The kitchen's desserts are quite good today, you should try some too."

Looking at his composed demeanor, Guo Xiaohan's unease vanished, replaced by an almost blind trust.

She obediently picked up a piece, took a small bite, and her eyes curved into crescents: "Mmm, so delicious."

"Master, Mr. Li Jiacheng has arrived," the butler announced at the opportune moment.

"Let him come over." Lin Haoran put down his teacup. (End of Chapter)