National Tide 1980.

For the Japanese stock market, the first trading day of the new year in 1990 marked the beginning of a real crash.

For seven consecutive trading days, the market has been experiencing a relentless and sharp decline.

There was absolutely no positive support to be seen; all we saw was the continuous plunge in stock price, sending us straight into hell.

到1月12日周五收盘为止，日经225指数已经从去年收官38409的高点跌去了10000多点，收在了28344点，七天的大盘下跌幅度高达26.%。

If we consider the peak of 40101 points in the Japanese stock market last year, the decline has even exceeded 30%.

The total market capitalization of the Tokyo Stock Exchange also plummeted to behind that of the New York Stock Exchange.

This shows how much wealth evaporated and how devastating the damage was!
The sharp drop in stock prices has caused great anxiety among all the borrowers who provided financing.

Whether it's securities firms or underground financial practitioners, they need to obtain more cash to meet the funding needs of those who use margin trading to speculate on stocks.

Speculators should also try their best to abide by the agreement and replenish their positions as soon as possible.

Otherwise, their positions will be immediately liquidated by those unfriendly underground margin trading borrowers—that is, "margin call".

In response, officials from the Ministry of Finance held emergency consultations over the weekend and issued an emergency response strategy on Sunday, January 14.

First, it was announced that the margin requirement for stocks would be reduced from 70% to 50%.

Secondly, pressure was put on Japan's four major securities firms, demanding that they cease issuing stocks or warrants/bonds until the stock market recovers.

This was an attempt to salvage the stock market's disastrous downturn.

Surprisingly, these two methods did have some effect.

On January 15, 1990, the Nikkei 225 index quickly stabilized upon opening, and then began a seven-day rebound, recovering 4600 points of lost ground in one fell swoop.

到1月23日为止，日经225指数重新回到32927点，阶段涨幅高达16.2%。

As a result, some analysts became optimistic again.

Over the past seven days, financial professionals have repeatedly declared that Japan's bull market is not over.

It is said that under the policy support of Tibet Province, the stock index has stabilized and the rebound can reach at least another 3000 points.

Japan's economy is large and of high quality, and absolutely justifies its current valuation.

However, things in this world are so strange; they were immediately proven wrong as soon as they said those words.

Starting from January 24, the Tokyo Stock Exchange unexpectedly began another 1-day downward cycle.

Moreover, this time the decline lasted from January to February, and the drop was even more severe than the previous seven-day plunge.

By February 15, the Nikkei index had fallen to 19150 points, a drop of more than 14000 points, or 41%.

This Valentine's Day is probably the day when women are most neglected, because the whole of Japan is mourning the loss of wealth.

It was precisely at this time that Japanese financiers, who had previously looked down on Americans, truly realized that the stock index futures that Morgan Stanley had given them, which allowed them to "earn commissions for free," were actually a financial bomb, with enough "power" to send the Japanese economy to its grave.

As a result, Japan's largest professional economic newspaper, the Nikkei, immediately published an article condemning stock index futures for causing the Japanese stock market to fall.

Subsequently, Asahi Shimbun, Yomiuri Shimbun, Sankei Shimbun and other newspapers responded by publishing numerous news reports, identifying stock index futures as the culprit of the stock market crash and demanding that the government quickly introduce countermeasures.

Given this, the authorities can only continue their efforts to support the stock market.

Furthermore, in order to reduce the harm of stock index futures and meet the demands of all parties to "reduce stock index futures trading and increase stock prices," the Ministry of Finance also requested the Osaka Stock Exchange to increase restrictions on stock index futures trading.

Therefore, between February 12th and February 15th, Japan's Ministry of Finance once again introduced a series of policies to stimulate the market.

First, Japan's four major securities brokerage firms were asked to buy shares to support the market.

Second, the required margin has been reduced to 30%.

Third, life insurance companies were required to stop selling shares.

Fourth, the ban on new share issuances has been extended.

Fifth, funds from public retirement funds and postal savings accounts were channeled into the stock market.

Sixth, many accounting techniques are used to prevent institutional shareholders from selling their shares.

Finally, and most importantly, the margin requirement for stock index futures has been increased from 4% to 6%.

Thus, starting from February 16th, the Japanese stock market truly ushered in a 24-day period of rebound.

At this point, it seems that participants in the Japanese stock market can finally breathe a sigh of relief and truly recover their losses.

However, the reality is not like that.

Unfortunately, this rebound was not only fraught with difficulties and setbacks, but its height was also very limited.

The recovery was not as strong as the previous seven-day recovery, only around 4000 points.

That's not all. The key issue is that the market didn't stabilize after that. After a brief rebound, the market began a long and seemingly endless decline.

It's like cutting flesh with a dull knife—the rate isn't high, but the Japanese stock market is bleeding every day, losing its vitality.

It's as if they're about to slide straight into an abyss, and no matter what policies the Japanese government or securities companies introduce, it won't help.

Why is this happening?

The answer is simple: many Japanese people, including the Japanese Ministry of Finance, have misunderstood the main problem behind this stock market crash.

They attributed the bursting of the Japanese bubble to foreigners shorting the stock index futures market, but in reality, that was just a superficial phenomenon, merely a means for Americans to plunder Japanese wealth.

The real reason is the sharp tightening of Japan's monetary situation against the backdrop of a strengthening US dollar.

If this problem cannot be solved, the exploitation of Japan by American financial groups in the capital market cannot be stopped.

As we all know, the essential foundation for the prosperity of any stock market is sufficient liquidity. If the Japanese stock market loses liquidity, it will naturally no longer have the logic for a bull market.

So no matter how hard they try, it's just "holding on" and won't have much effect on saving the market.

In fact, because the Japanese authorities refused to allow the stock and real estate markets to fall enough to reach their proper equilibrium point, they suppressed the market's ability to squeeze out bubbles on its own, which is what economist Schumpeter called "creative destruction."

Ultimately, the Japanese government's mishandling of the situation not only failed to alleviate the problem but also caused even more painful aftereffects of the bubble economy, severely hindering Japan's economic recovery and improvement—a result they certainly did not want. Unfortunately, there's no going back.

Or, to put it another way, given that Japan's government is subject to the control of the United States, and that Japan's capital market has been manipulated by the Americans and has fallen into a trap from the very beginning.

Even if we could do it all over again, I'm afraid many things still wouldn't be able to change.

It's hard to imagine how these officials who formulated the response strategies would feel if they re-examined their past actions years later.

In any case, the Japanese economy was doomed and officially entered a recession; this is an undeniable fact.

Tokyo's dream of becoming a global financial capital was shattered by the drop in stock prices.

Of course, at the same time, there were also many ambitious people and bubble gentlemen who made their fortunes through the bubble economy, and their careers and lives collapsed along with it.

Takahashi Harunori was the first unlucky guy among them to go broke.

For no other reason than his ambition and greed, which led him to take many risky and aggressive measures for the company's rapid expansion, resulting in excessive debt.

More importantly, it was because he offended the wrong people and at a crucial moment he encountered a retaliation that was impossible to resist but deadly enough, which directly led to his downfall.

It's important to understand that EIE Group wasn't the only company severely impacted by the bursting of the bubble.

Furthermore, Harunori Takahashi has many affiliated companies through business dealings, and he himself has the bloodline of Keio University, giving him considerable connections in the Japanese business world.

Even just before the stock market crash, Harunori Takahashi had a closer partnership with the Kuok Group – they were preparing to open golf clubs together in Southeast Asia, and the Kuok Group also invested US$150 million to help him squeeze out his competitors' short positions.

If we only consider economic strength and personal connections, Harunori Takahashi is probably stronger than most other contemporary bubble economy gentlemen who can be compared to him.

Theoretically speaking, if appropriate measures are taken, his EIE Group could still gradually recover.

Even if it can't be saved in the end, at least Harunori Takahashi shouldn't be the first one to go down, after all, even a starved camel is bigger than a horse.

But the worst part was that when he was lying on the ground trying to get up, someone kicked him again from behind.

This kick was like adding insult to injury; it was ruthless and cunning, carrying both old and new grudges, and it directly drew blood from his heart.

The person who delivered the final blow was Ning Weimin, the very person he had always wanted to scheme against, but who had actually been secretly plotting against him all along.

Frankly speaking, this stock market crash has been extremely destructive to Japan's economy and to Japanese listed companies; it is definitely not a good thing.

Even Japanese securities firms, investment institutions, and ordinary Japanese retail investors who bought stocks and failed to sell at the peak in time suffered heavy losses.

But it's not that no one can profit from it.

Besides the large number of short-selling forces led by the United States and other foreign financial groups, Ning Weimin, who was hiding in the shadows and following behind them to take advantage of their favorable situation, was of course one of them.

He's no novice at profiting from chaos.

Back when he was LVMH's white knight in France, competing with Bernard Arnault, he already knew how to use natural disasters to strengthen himself and weaken his enemies.

This time, he certainly played with even more ease and skill.

In fact, before the stock market crash, Ning Weimin had shorted all the stocks he held at Nomura Securities and Daiwa Securities, as well as the stocks he had borrowed from short selling, and was patiently waiting for the Nikkei 225 index to show signs of topping out.

Then he had the group in Osaka use some of the funds he had already freed up to short stock index futures.

By January 25th, just before returning to China for the Spring Festival, Ning Weimin had no shares left, only short-selling contracts for stock index futures.

The amount of money he had accumulated in all his securities accounts alone was as high as 763.2 billion yen.

If we include the value of stock index futures contracts, as well as the money he made from selling several parking lots during this period, it would probably reach trillions of yen.

That is one trillion, roughly equivalent to tens of billions of US dollars in cash assets.

Of course, this also includes the more than 300 billion yen owed to Sumitomo Bank, the unreturned financing from Daiwa Securities, and the shares of Nomura Securities.

There are even unavoidable situations where he has to pay a portion of the taxes to the Japanese government because of his profits from the capital market.

In terms of ownership, although Ning Weimin can dispose of and use the money, it cannot be said that all of it belongs to him.

But don't forget, Ning Weimin still has a large amount of real estate that he hasn't cashed out or sold.

Moreover, after he returned from the Lunar New Year holiday, due to market fluctuations, the Nikkei 225 index plummeted again, and his profits from stock index futures increased by another 100 billion yen.

Therefore, his true net worth is no less than that, which is an indisputable fact.

Clearly, from a wealth perspective, the real money he possesses is more fitting for the title of "creator of a trillion-yen empire" than Takahashi Harunori, who built his fortune solely through borrowing.

Moreover, at this very moment, looking at his opponent—"Keio Boy" Harunori Takahashi—his wealth shrank and his net worth plummeted because he deliberately drove up the stock price against him, and then suffered a stock market crash.

He had already fallen from the high clouds in a very sorry state; to say he was half-dead would be an understatement.

On February 16, when the Nikkei index hit a low of 19150 points, its lowest point in nearly a decade, EIE International's stock price had already fallen to 2 yen.

The stock's market value has shrunk to 983.2 billion yen, which is only a quarter of its peak value.

Because EIE's liabilities exceed one trillion yen, while its net assets are around 1.5 trillion yen, which is enough to cover its debts, its price-to-book ratio is clearly very distorted.

It is conceivable how powerful the Heavenly Tribulation is.

Now that Ning Weimin, who is now completely stuffed, is about to take on Takahashi Harunori, whose entire body has been emptied by the stock market, it's not hard to imagine what the outcome will be.

This is called a zero-sum game; they're not even in the same league, okay?
With Ning Weimin's current personal financial resources, he could swallow the entire EIE at any time if he wanted to.

The key issue is that Takahashi Harunori's allies are also preoccupied with their own problems, each facing their own difficulties and struggling with the stock market crash.

Even if they wanted to, who would have the resources to help Takahashi?
Ning Weimin, on the other hand, has people helping him.

It's important to know that, in order to continue profiting from shorting stock index futures, Americans began targeting companies with high debt ratios and those blindly expanding their assets starting in January, issuing short-selling reports on them.

EIE International, on the other hand, recently became a target chosen by Lehman Brothers, an easy target to exploit.

At this moment, with the right timing, favorable location, and harmonious relationships, it was the perfect opportunity for Ning Weimin to launch a surprise attack.

Can he still ensure that Harunori Takahashi has a good son?
Grandma! (End of Chapter)