What do you mean by quitting the business? I'm not a big shot.

Chapter 574 The 1987 Stock Market Crash
Shi Zhanpeng rushed to the office, pushed open the glass door, bowed and called out, "Boss."

"How many shares of 0002 does the company still have?" Yin Zhaotang asked, standing up as he held his cigar.

Shi Zhanpeng replied, “Thirty-six million shares, with a market price of HK$7.82 per share, are worth HK$280 million. This represents 4.7% of CLP Power’s equity and 17.8% of the foundation’s holdings. The average purchase price was HK$6.74, resulting in a profit of HK$35 million.”

"0002 has been rising recently, driven by positive news and a strong upward trend. Funds still have HKD 4 million in funds, which can be used for large-scale purchases."

Because the big boss himself pays close attention to 0002, the fund will treat 0002 as its number one stock and operate it accordingly. In terms of holding ratio, it is already considered a heavy position.

Yin Zhaotang took a puff of his cigar, glanced at the fund manager whose face was brimming with a desire to show off, and gave a cold smile: "Sell!"

"What's so good about it, Mr. Yin!" Shi Zhanpeng, wearing glasses and designer clothes, looked astonished. Selling a stock with a large upward trend would obviously affect fund returns and, more importantly, the performance bonuses of the managers.

Yin Zhaotang, however, remained cold, waved his hand decisively, and said, "Sell all of 0002."

Shi Zhanpeng wanted to offer some advice, but seeing the boss's aggressive demeanor, he suppressed his thoughts and bowed again: "Yes, boss."

Watching the fund manager leave, he went to the calendar and saw that the date was September 1987.

In October, the stock market crash broke out.

Although he couldn't remember the exact time, he did remember "Black Friday," a Friday in October when the Dow Jones Industrial Average suddenly plummeted for no apparent reason.

The chain reaction immediately swept the globe, with stock markets in the UK and Canada plummeting.

Two days later, Hong Kong stocks opened and the Hang Seng Index plummeted, known as "Black Monday," with the largest drop in history second only to the "August 1st Crash."

Yin Zhaotang had no idea that someone was using 0002 to set a trap, but the stock market crash was coming soon, and the stocks he held were already at a high price. He could sell high now and buy low later, making a fortune in one go.

At this point, the higher the stock price has risen, the more severe the fall will be later.

Even if he wanted to acquire 0002 again, he would have to wait until after the stock market crash.
As sell orders increased in the market, stock 0002 experienced a brief dip, but the Far East Club's stockbrokers poured money into buying it all, and after the brief decline, the stock began to climb again.

There were many rumors circulating in the market. Some people said that CLP Power would build a new power plant in Lung Kwu Tan, Tuen Mun. Others said that CLP Power had signed an agreement with Taiwan to expand its business. Each rumor seemed plausible, attracting many citizens to buy shares and making 0002 even more popular.

Back then, with the success of the Far East Exchange, stockbrokers who started their businesses with Li Fuzhao and others became either financial newspaper columnists, guest experts on stock programs, or highly renowned top brokers who independently opened their own exchanges.

With connections and public opinion, the financial chains that can be leveraged are unimaginable. It would be an exaggeration to say that they can control everything in the Hong Kong stock market, but manipulating the rise and fall of a single stock is a piece of cake for them.

Seeing 0002 continue to rise, the managers of Zhongyi Fund were all kicking themselves, wanting to chase the rising price.

In the cigar room of the Far East Club at the Chinese Building on Queen's Road Central, Li Fuzhao looked at a portfolio report, a hint of fear flashing in his eyes: "Yin Zhaotang sold all his British-owned companies?"

Hu Baixi, with his large belly, sat on the sofa, sipping his coffee, and said, "Yes, according to the publicly disclosed changes in the holdings of the Zhongyi Foundation, within a week, Shenxiantang not only sold off all of 0002, securing 36 million shares, but also sold off all of his shares in various British-owned companies, with a total value of over 300 million Hong Kong dollars." Li Fuzhao patted the report, looking puzzled: "Although it's a foregone conclusion that Chinese capital is larger and foreign capital is smaller, foreign capital still holds a considerable amount of high-quality assets."

"Selling British but not Chinese, selling foreign but not Chinese, what kind of trick is Shenxiantang up to?"

Hu Baixi suddenly chuckled and reminisced about the past: "This reminds me of 1973, when the Far East Exchange had just been established. Even Chinese business owners rarely visited it; the major clients were all ordinary citizens. Chinese-funded companies were just starting out, competing with British companies for money when they went public. The foreigners used the Jardine Matheson Milk scandal to create a stock market crash, causing many citizens to go bankrupt and jump off buildings."

"Back then, we were newcomers, and we favored British companies over Chinese ones, selling foreign assets to foreign companies over Chinese ones. We saved many good Chinese-owned companies. For example, if we hadn't managed them, how many of Cheung Kong, Hopewell, and Sun Hung Kai would still be around?"

Li Fuzhao nodded with deep emotion, saying, "If it weren't for that battle, the Far East Association wouldn't have been able to become the largest stock exchange, and I wouldn't have become the chairman of the Stock Exchange. With Shenxiantang's methods, there's bound to be another stock market crash, Ah Xi. Will there be a stock market crash?"

Li Fuzhao suddenly became serious and looked at Hu Baixi, who was in charge of information. Hu Baixi also frowned and said, "Global stock markets are doing very well, and even the US stock market, which is most prone to problems, is currently very stable. Unless there is a sudden political event like the August 1st stock market crash, there is no reason for a stock market crash to occur!"

Li Fuzhao nodded: "There is no political risk. Perhaps Shenxiantang received an incorrect message and misjudged the situation."

Hu Baixi cautiously said, "If you haven't caught any fish, should you pack up? If you put the bait back now, you can still make a profit."

Li Fuzhao said calmly, "Shenxiantang received the wrong information and didn't make a move. If 0002 rises again in a few days, he will definitely be unable to resist investing heavily."

“Raise the price even higher, I don’t believe he can hold back.”

In fact, the Far East Club's operation was very successful. Apart from Yin Zhaotang's personal withdrawal, the entire market was chasing the high price of 0002.

Many employees of Zhongyi Fund bought shares using their personal accounts. Coupled with the overall bull market, nobody believed a stock market crash was imminent.

Even though Yin Zhaotang's trading methods were crude, experienced people could tell he was trying to avoid risk. But the market frenzy not only clouded the judgment of retail investors but also clouded the judgment of the behind-the-scenes manipulators.

In a broader sense, the major players in Hong Kong stocks are just small fish in the international market.

When Wall Street pulls the net, no one can escape.

On September 30, the Hang Seng Index broke through 4000 points, reaching a new high of 4021 points, and remained at a high level for the next few days. Until October 16, a Friday, after opening, it suddenly dropped 100 points, rebounded at noon, and closed at 3783.20, down 45.44 points, causing turmoil.

That evening, the Dow Jones Industrial Average in the United States plummeted by 91.55 points, triggering computer-driven sell orders and causing a chain reaction of declines in global stock markets.

Even Wall Street traders probably didn't anticipate that a simple short-selling move would trigger a global stock market crash. This is because computer trading has only become widespread in the US in the last two years, and many trading firms and large clients have stop-loss orders set on their computers.

This short selling first triggered the program setting of "automatic selling when the price drops by more than 10%", and then the panic selling by this batch of accounts directly caused all the accounts with "automatic selling when the price drops by 30%" to sell their stocks!
The stock market crash caused by computational programs far exceeded the imagination of Li Fuzhao, Hu Baixi and others.

(End of this chapter)