Hong Kong 1980: The Savage Era

Chapter 389 390 [Continue to Decline]

Wednesday, May 10

An article titled "The Private Benefits of Suspending the Market" was published in a newspaper, adding fuel to the already panic-stricken market, and many people cursed the Chairman of the Hong Kong Stock Exchange, Mr. Li Fook-chiu.

At the press conference on the 20th, Australian reporters bluntly questioned Li Fuzhao: Is the order to suspend the market related to personal interests (family stocks managed by Li Fuzhao)?
As the chairman of the Hong Kong Stock Exchange, Li Fook-shao has always been quite domineering, with a status like that of Karl Lagerfeld. He could not stand this tone, so he flew into a rage, glared at the ignorant foreign reporter, and angrily scolded him in English.

The reporter was a man who never shied away from publicity, so he published this news in all newspapers.

A Western newspaper reporter called Li Fuzhao an "uneducated country bumpkin."

The public was originally extremely dissatisfied with the market suspension, and now with the help of the media, the situation has become even more out of control.

Under this pressure, the Hong Kong government announced the establishment of the "Securities Industry Review Committee", and Li Fook-chiu, Chairman of the Hong Kong Stock Exchange, was the first to bear the brunt.

Luo Qihong threw down the newsprint. He knew that Li Fuzhao's measure of closing the market was a stupid move, but it was definitely not just for personal gain.

However, things have come to this point and the Hong Kong government cannot take responsibility and can only drag Li Fook-chau out to take the blame.

The most important thing is that the stock market will become even more tragic because of the 4-day closure. Once the market opens, investors will inevitably flock in and sell their stocks.

Some companies' stocks may become worthless.

Although Luo Qihong wanted to buy at the bottom and make a profit, he also didn't want the market to become so dire. After all, he could make money when the market was good.

Monday, September 10
As soon as the market opened, selling orders came in like a tidal wave. In just 15 minutes, the Hang Seng Index fell by more than 650 points. By the time of the lunch break, the Hang Seng Index had fallen to 2476.69 points.

It is a staggering drop of 3949.43 points from the peak of 1472.74 points.

Many stockholders stumbled out of the exchange, muttering "It's over, it's over"

In fact, the stock prices of many companies have fallen by more than 80%, the stocks have become worthless pieces of paper, and some company bosses have quietly fled.

Siu On Real Estate Company Office

The three giants gathered in Luo Qihong's office, and even when it was time for lunch, they had no appetite.

"This stock market crash is even more severe than the last one in 82. The decline exceeded 2% in less than two days. Many companies have applied for suspension of trading." Cheng Jianshen said in a deep voice.

"We can't stop this. Who can stop a tsunami sweeping the world?" Luo Qihong said with a bad face, "How much has the share price of our subsidiary company fallen?"

"Zhaoan Real Estate fell by 8% and Huaguang Real Estate Company fell by 12%," Cheng Jianshen reported.

Seeing that the atmosphere was cold, Chen Zhilong flattered him, "It is the boss who has foresight and vision, otherwise our company would be like an ant on a hot pot, burning with pain."

"You guys get ready and send out the company's first half earnings report. Try to save as much of the stock price as you can." Luo Qihong said helplessly.

"What about Huaguang Real Estate Company and Furama Hotel? Do they need to be announced?" Cheng Jianshen asked.

"Don't disclose the financial information of these two companies, only Zhaoan Real Estate Company. In order to better privatize these two companies, after the disclosure is completed, you should privately contact other newspapers and ask them to question why the financial situation of the two companies is not disclosed." Luo Qihong said.

This is obviously intended to further suppress the share prices of Furama Hotels and Huaguang Real Estate Company so that Zhaoan Real Estate Company can start the privatization process.

In fact, this only accelerated the decline in the stock price, and there was not much difference from the final stock price. After all, the assets of Huaguang Real Estate Company and Furama Hotel were good. "Boss, we are not in a hurry to privatize these two companies. Don't we need to spend this money?" Kang Wenyi suggested.

"Well, let's use this advertising fee as employee benefits. Divide it equally among the company's departments so that they can have a good meal." Luo Qihong accepted the suggestion with a smile.

The Hang Seng Index has fallen so sharply, and China Real Estate Company has a lot of debt, so the share price should be able to fall by half, and the Furama Hotel could fall by 6% to 7%, which can save a lot of money.

Return to Luo’s villa in the evening.

After dinner, Luo Qihong and his wife, Luo Qixing and his wife came to the study to discuss the stock market crash.

"How is Shengyun Real Estate? I heard that the stock prices of small and medium-sized companies have fallen sharply." Luo Qihong said lightly.

Before the disaster, Luo Qihong had already reminded Luo Qixing and his wife, but if they didn't listen, there was nothing he could do.

We can't let Luo Qihong force them to do things.

"We have lost 18.3% of our market value. Fortunately, we sold 11% of our shares before the disaster and recovered 5 to 6 million in cash. Otherwise, we would have really gone bankrupt," Luo Qixing sighed.

This global stock market crash was so severe that if it weren't for his younger brother Luo Qihong's reminder, he might have really considered selling Shengyun Real Estate's core assets and all his personal assets to overcome the difficulties.

Hearing Luo Qixing's tone, Luo Qihong knew that they discounted his suggestions, and such behavior made him helpless. Those who could be taught did not need to be taught, and those who could not be taught could not be taught.

Luo Qixing is naturally the latter.

"It may be a good thing for you to fight against the company. You can make money from the difference in stock prices." Luo Qihong said, "You can even take the opportunity to increase your equity holdings."

Luo Qixing nodded and said, "Shengyun Real Estate is a small company. Wouldn't it be more profitable to invest in stocks of large companies?"

"Brother, you don't believe in yourself. Shengyun Real Estate Company is your own company. Don't you have the final say on how much money it can make?" Luo Qihong laughed. "Look at Liu Luanxiong of Chinese Estates. He is desperately using his personal funds to expand Chinese Estates. It shows that his own company still makes more money."

"Ah Hong, we are different from you. You are rich, but we don't have much private funds. If Shengyun Real Estate issues shares to raise funds, it will be difficult for us to cope with it." Chen Yusan said.

"You still have to figure it out yourself. De'an Company invests in securities and stocks. You can talk to Ayan." Luo Qihong pursed his lips. These two people still think that he has been helping and supporting them all the time, but they like to disobey others. They really have problems with their brains.

"Brother, sister-in-law, the current situation is not very clear, but De'an Company has some reputation in the field of securities and stocks. If you want, De'an Company can help you with the operation." Seeing that Luo Qihong had spoken, Bai Jinyan could only agree.

"The stock market crash will continue for quite some time. Let's talk about bottom fishing later. For now, we must run the company well." Luo Qihong said calmly.

Chen Yusan's mind was active, and she said, "Shengyun Real Estate wants to acquire high-quality companies. What do you think, Ah Hong?"

"I remember that Shengyun Real Estate Company had a lot of debt before, so acquiring other companies may not be a good choice," said Luo Qihong.

Bai Jinyan didn't want to care about these things. In her eyes, making money was enough, so she said, "Sister-in-law, I think we can consider the acquisition after the Spring Festival next year. The company's stock price will definitely not be high at that time."

Chen Yusan didn't believe Bai Jinyan's words, "Well, we'll talk about it when the time comes."

"Which company have you taken a fancy to?" Luo Qihong asked thoughtfully.

"Hai'an Real Estate Company! The market value of this company is far lower than its asset value. It is our first choice." Luo Qixing glanced at Chen Yusan and said.

(End of this chapter)