Rebirth Tokyo 1986

Chapter 452 What are some good projects in South Korea?

Time keeps flowing, and 1997 quickly passed by.

That year, East Asian and Southeast Asian countries first experienced a financial crisis, which then led to an even more severe economic crisis.

What terrifies the ruling classes in these countries and regions even more is that the international speculative capital led by Soros has not yet withdrawn. They are preparing to sweep through again and again, viewing the entire Southeast Asia and East Asia as a cash cow.

However, Soros's sweeping campaigns have also forced some countries to undergo radical social reforms.

For example, most of China's zombie companies were wiped out in this wave of financial crisis.

Of course, reforms will inevitably harm the interests of many people. Tens of millions of workers are the price of this change.

But there was nothing that could be done; at that time, Chinese companies, much like Japanese zombie companies, were consuming more than 90% of the country's loans.

Even worse, these loans were mainly used to pay wages, rather than to introduce advanced technologies to improve production efficiency and thus make more money.

Considering the future, we can only choose short-term pain.

Japan also has similar aspirations, but the drawbacks of its electoral system and its heavy debt ratio prevent the government from making a firm decision to carry out a complete reform, and can only make partial changes.

The differences between the two countries are somewhat similar to the reforms of the Qin and Zhao-Wei states during the Warring States period in China.

One underwent a complete transformation, while the other only made minor optimizations. And the area Japan focused on optimizing during the financial crisis was its domestic financial sector.

Many financial institutions went bankrupt, and the survivors joined forces to form even stronger financial groups.

However, this trend is currently only emerging in Japan. Most financial institutions are reluctant to merge, choosing instead to hold out for a while and wait for the domestic economy to improve.

Unfortunately, they were destined to be disappointed.

The financial crisis was extremely damaging to Japan, and it will take at least five years for new opportunities to emerge. Japanese domestic financial institutions, particularly banks, will find it difficult to survive that long on their own.

Besides forcing national change, Soros's offensives have also brought about many changes for businesses.

Some companies expand too quickly and borrow too much money, leading to bankruptcy, while others find opportunities to get rich.

Xinghai Group clearly falls into the latter category.

Not only did they seize the opportunity to acquire Yamaichi Securities, but they also have their eyes on giants such as Nissan Motor and Changxin Bank, preparing to take them all at once.

The Japanese Lunar New Year passed quickly, but this time he did not go directly to China, but stayed at the group to handle affairs.

"Koreans are truly united!"

As Masato Takeshita sat in the conference room watching a television report about South Korean citizens actively donating gold, he couldn't help but turn his head to look at Rogers, the group's first vice president, to his left.

He also wants to build his group into a company with a Korean flair.

In this way, when the company is in a slump, it can better recover and develop by leveraging the support of the people.

South Korea is a case in point; its economic crisis only lasted for a year or two before it quickly emerged from the shadows.

Soon after, it directly defeated Japan in industries such as semiconductor chips and panels, as well as in downstream consumer electronics such as mobile phones and televisions.

"Yes, this is the first time I've seen a country facing economic problems and people actively donating gold to help."

Rogers was also greatly shocked, as such a thing could never happen in his Western homeland.

When the motherland is in trouble, it is extremely rare for capitalists in Western countries not to hoard goods and make a fortune from the war, let alone actively donate money to help the country get out of the quagmire.

In terms of unity, South Korea is indeed superior at this time, with virtually no other country able to match it.

It's worth noting that in this gold donation campaign, the South Korean government received tens of tons of gold, which in turn brought in a large amount of foreign exchange.

"It was truly shocking, but unfortunately, it was like a mantis trying to stop a chariot."

"Yes, South Korea has accumulated too much debt for development, so a few dozen tons of gold is just a drop in the bucket."

Rogers is very familiar with the economic situation of various Asian countries and knows that South Korea needs to come up with tens of billions of dollars to repay its debts.

Even if the amount of gold were increased tenfold, let alone the current amount, it still wouldn't be enough.

Besides, financial crises have a chain reaction.

Countries like Malaysia and Singapore have strong economies and little debt, yet their stock and currency markets have both plummeted.

The same is true for Japan, which, dragged down by Southeast Asia and South Korea, saw its stock and currency markets both decline.

It reached its highest point in the foreign exchange market, with an exchange rate against the US dollar exceeding 1:150.

Two years ago, this number was around 1:90.

It can be said that throughout East Asia and Southeast Asia, except for the three countries of China, North Korea, and Mongolia with underdeveloped financial industries, stock and currency markets have all experienced declines.

"Well, I guess in the end they will still accept the conditions for a fully open market offered by the US-controlled International Monetary Fund."

Japan and South Korea have very different fates.

Japan has a strong economic foundation and can rely on its own funds to repay its debts. Therefore, while it was significantly impacted by the financial crisis, its economic and industrial independence remains very strong.

South Korea is in a different situation. Without borrowing money from the International Monetary Fund, the entire country would face credit bankruptcy and become a vassal state completely controlled by the United States in both political and economic spheres.

However, becoming a vassal state also has significant advantages, namely, it allows Japan to access more technology and funding that the United States proactively releases to it.

"So, once South Korea accepts, can we launch a full-scale operation against South Korea?"

“That’s right, but we can’t become the largest shareholder of the selected target.”

The unity of the South Korean people deterred the Starsea Group from rashly acquiring top companies in South Korea.

He worried that once the acquisition was completed, the South Korean public would spontaneously refuse to use the company's products.

Especially in the financial sector, one must be extremely careful.

What if Xinghai Group acquires a top-tier bank, and then ordinary people transfer their money and close their accounts shortly afterward?

That would mean we acquired it for nothing!

He wants more business, not just an empty shell.

"Yes, President, I understand!"

Rogers immediately understood that South Korea's fervent nationalist sentiment was indeed unsuitable for the group to directly acquire top companies.

Small and medium-sized companies, on the other hand, do not have any messy national honors, making them more suitable for Xinghai Group to acquire as a whole.

Whether it can be developed depends on subsequent measures.

Of course, Xinghai Group is not entirely without the opportunity to acquire large financial institutions.

If an acquisition is to be made, it would be best to wait three to five years, until the fervent nationalist sentiment in South Korea has subsided somewhat, and then complete the acquisition at a more reasonable price.

In this way, the South Koreans will not feel aggrieved or taken advantage of, and will not hold too much grudge against the Xinghai Group's acquisition.

That's often how doing business works.

If you acquire a company at a low price, you will incur the open and covert resentment of the local people and the government.

Therefore, companies often prefer to acquire assets at normal prices in normal years rather than wait for prices to drop during an economic crisis.

As for those who just want to make money from this opportunity, that doesn't matter.

This is why, when Soros swept through Southeast Asia and East Asia, American capital always arrived late to provide assistance.

After discussing the acquisition and equity investment, Masato Takeshita thought about the major money-making projects that had emerged in South Korea after the financial crisis.

"Based on available information, South Koreans have begun betting on PC-based online games. I think this industry has great potential, and the company should invest more in this area." "Online games?"

Rogers raised an eyebrow, his interest piqued.

After all, this is the industry he has dedicated half his life to.

"That's right, it's an online game. A game where people from different places can play together online."

"Quake, designed and developed by Carmack and others, is an online game."

Carmack was acquired by Starsea Games early on, and projects he later spearheaded, such as Quake, were naturally also under the Starsea Group.

However, unlike Americans, South Korea, which was heavily influenced by Japanese games at the time, mainly focused on RPG games.

This was also the most influential game genre globally at the end of the 20th and beginning of the 21st century.

Even if FPS, MOBA and other game genres rise in the future, RPG games are still the most profitable.

However, unlike FPS and MOBA games, RPG games have seen a diverse range of genres and styles.

They make a lot of money, but there's simply no game that can represent this type of game.

This may also be related to the game genre.

FPS and MOBA games emphasize competitiveness and follow a fair competitive approach, thus exhibiting a stronger Matthew effect.

RPG games focus on dungeons and raids, which makes it difficult to attract the vast majority of players.

Even World of Warcraft, a representative of PC RPG games, could not capture the vast majority of the market at its peak.

Unlike MOBA games, which have unparalleled monopolistic power and can achieve a winner-takes-all scenario in the mobile internet market.

"I understand, Chairman, you mean I should inform Kikuno-san?"

"No, no, no, I'm just letting you know first. I plan to talk to Kikuno-san about this tomorrow, and then the two of you can go there together to find suitable projects to invest in."

He couldn't allow Rogers to extend his reach into Starsea Financial; that was his private territory.

"That's it, I understand."

Rogers didn't care; he was well aware of Xinghai Financial's standing in his chairman's eyes.

However, this is normal. Xinghai Group's rapid expansion with a debt ratio of less than 20% is at least half thanks to Xinghai Financial.

If this were a world without Xinghai Financial, Xinghai Group would need to have a debt ratio of at least 60% to grow to its current size.

Of course, for the vast majority of companies, 60% is not a very high figure, and many companies have debt ratios that easily exceed this ratio.

However, it's best to avoid having a high level of debt if possible.

If it weren't for the need to cultivate good relations with the government and the business community, the young man would have even considered following Nintendo's zero-debt strategy.

Of course, this small amount of debt is not a big deal right now.

Xinghai Group has enough cash reserves to easily repay its loans while simultaneously making the company even stronger.

Once a decision is made, it must be made quickly. Takeshita Masato arrived at Xinghai Financial early the next morning.

"How are you settling into your new job?"

Kamoto Takamasa is busy handling various matters at Yamaichi Securities every day, so most of the work at Seikai Financial is temporarily handed over to Kikuno Shinji.

In other words, he not only has to manage Xinghai Investment, but also the entire Xinghai Financial.

As for Starsea Ventures, the US operations have been handed over to Tom, a local. The smaller operations in Asia will remain under his responsibility for the time being.

This is why, when young people are preparing to invest in the South Korean game development market, the first person they think of is Shinji Kikuno.

"For the time being, Xinghai Investment is fine."

Xinghai Investment takes a long-term approach and rarely engages in daily operations, so Shinji Kikuno doesn't need to put in too much effort.

As for companies like Galaxy Capital, they are in similar situations, which makes him relatively free on weekdays.

"That's true, Xinghai Financial does have very little to do on a regular basis."

Takeshita Masato nodded in agreement, and then began to explain the purpose of his visit.

"Investing in the South Korean online gaming industry is no problem for me."

Shinji Kikuno readily agreed. He was a bit of a restless person, and the lack of work these days made him feel restless.

"OK, then I'll leave this to you and Rogers-san."

After explaining his investment in Korean games, Masato Takeshita hurriedly went to Xinghai Electronics.

When he thought of South Korea, he thought of an electronic consumer product that almost bankrupted Sony—the MP3 player.

Yes, the MP3 music player developed by South Koreans almost caused Sony Group to go bankrupt in later generations.

As for why, it goes back to Sony's original business.

Sony has two flagship products in the consumer electronics field: the Trinitron television and the Walkman.

These two products ensured that Sony had a continuous source of funding for research and development.

But at the end of the 20th century, the MP3 developed by South Koreans for the Internet directly brought the Walkman to its lowest point.

People no longer listen to music on portable music players, but rather on more convenient and stylish MP3 players.

Sony instantly lost a music player market with annual sales of tens of millions of units.

At the same time, Trinitron technology is no longer favored by TV manufacturers and users.

High-end, profitable televisions are starting to use plasma display technology, with a small number using LCD display technology.

With its two major consumer electronics products sectors both crippled, Sony's other major sector, entertainment, is also in dire straits.

Due to the impact of online piracy during the millennium, neither Sony Music nor Sony Pictures made much money.

As a result, Sony was left with only the PlayStation game console as its sole major product.

Yes, that's exactly it.

Shortly after the turn of the 21st century, Sony's business collapsed, and it was on the verge of bankruptcy.

Ultimately, it survived the bankruptcy crisis thanks to continuous financial support from its gaming business.

It can only be said that the future profitability of the gaming industry is extremely strong.

Not only Sony, but also top internet companies like Tencent made their fortunes through games.

Even Apple, which doesn't make games, will rely heavily on the gaming industry in the future. The majority of the revenue from their Apple Store comes from commissions on game sales.

More importantly, this part of the business requires very little investment but yields very high profits.

This is also the most important factor that led Microsoft to acquire Activision Blizzard.

If a company succeeds in the gaming industry, it can generate a very stable cash flow.

Of course, Masato Takeshita was referring to online games. Purely single-player games generally don't generate much revenue.

(End of this chapter)