1977: The beginning of the blind date with the daughter of the king

Chapter 753 The Real California Capital!
The conference room on the upper floors of the Long Technology Building was filled with laughter and cheerful conversation.

After all, if people were still somewhat skeptical about Li Changhe's plan to exploit Japan before, now, with the establishment of the US-Japan Monetary Council and the opening of the Japanese financial market, they no longer have any doubts about the plan.

Putting everything else aside, given the nature of those Wall Street people, if a country with such a high level of economic development as Japan were to loosen its financial controls, they wouldn't be the infamous Wall Street if they didn't cause trouble.

After the meeting, everyone else left, but James stayed behind.

"Vic, I heard you made a fortune again during the foreign exchange fluctuations in Hong Kong!"

James smiled and said to Li Changhe.

In those days, banks' funding channels were relatively transparent and limited. For Li Changhe's funds, from the United States to Hong Kong and back again, there were only a few banks available, and Li Changhe was only familiar with the American Bank and Chase Bank.

Anyone who follows Victor can get a general idea of ​​how much money went out and how much came back. Profit margins are relatively easy to calculate, especially for high-ranking executives at Bank of America like James.

"Actually, the gains from exchange rate fluctuations themselves are not significant. The real gains come from asset acquisitions brought about by exchange rate fluctuations, but the assets in the East are not very useful to you."

"Don't worry, James. Hong Kong is just an appetizer for me. Our real prize is in Japan, and that day is not far off."

"You keep an eye on the movements of the US Treasury Department. I'll go to Japan later; we still need to find a partner there."

At this moment, Li Changhe solemnly spoke to James.

James nodded, then looked at Li Changhe, as if he had something else to say.

Seeing James hesitate, Li Changhe smiled and asked, "James, is there anything else?"

When James heard Li Changhe's question, he thought for a moment and then said, "Vic, I have some things I'd like to talk to you about."

Li Changhe gestured, "Go ahead!"

James then carefully said, "It's about the Rockefeller family."

"The Rockefeller family?"

Li Changhe looked slightly puzzled.

James then revealed everything.

"Recently, the Rockefeller family has been in constant contact with some families in California, intending to integrate California's resources, especially some of the arms industry."

"Actually, in the past, I think many people would have found it difficult to resist the Rockefeller family's recruitment, but now, because of your appearance, many families are not short of money and have multiple considerations in this regard."

"However, we also know about your close relationship with the Rockefeller family, so in this matter, all the major families are inclined to find out your thoughts."

After listening to James's explanation, Li Changhe immediately understood the root of the problem.

To put it bluntly, it means that the infiltration of Eastern financial groups into Western California financial groups has begun.

Over the past two years, if we were to say which conglomerate in the East has made the most money, it would undoubtedly be Rockefeller.

The oil crisis may have been a disaster for the world, but for Rockefeller, who made his fortune in oil, it was a massive wealth-reaping exercise.

Just look at Texaco's ability to invest two billion US dollars in one go, and you'll know how profitable these oil companies are. They have so much money they don't even know what to do with it.

As for the Rockefeller family, which owned shares in numerous oil companies such as ExxonMobil, New York Petroleum, California Petroleum, and Texaco, their dollar profits at the top of the oil chain were even more substantial.

Looking at Li Changhe's exaggerated investment returns over the past two years, the fact that the Luo family isn't particularly envious or actively involved shows that they might not actually be interested.

However, with so much money, the Luo family would definitely want to expand their influence, so without a doubt, the other party set their sights on the military industrial enterprises of the California consortium.

In contrast to the Rockefeller Group, California's arms industry fell into difficulties after the end of the Vietnam War. After all, without war, where would the arms orders come from?
California's arms conglomerates were losing money year after year, and California's financial sector was underdeveloped at the time. Bank of America and Wells Fargo were just following Wall Street around, barely scraping by.

Therefore, before Li Changhe appeared, the California consortium's situation was deteriorating and becoming increasingly useless.

In other words, Li Changhe and the California consortium made a fortune during the oil crisis, and the outbreak of the Iran-Iraq War brought some orders to the arms consortium in the region, which gave the California consortium a little more breathing room.

Therefore, the California consortium now has more confidence to refuse the Luo family's invitation to expand. After all, who would be willing to hand over their company to someone else if they could be in charge themselves?

However, the California consortium is not stupid. For them, the biggest profits currently come from two sources. The first is the Iran-Iraq war, especially the orders from Saudi Arabia and other Middle Eastern countries to support Iraq.

Secondly, there's the financial gain that Li Changhe brings them. The profits that a financial genius can generate on the financial battlefield are actually no less than the profits from their arms business, and in many cases, even more lucrative.

However, there is a very real problem: Li Changhe has close ties with California conglomerates, but even closer ties with the Rockefeller family, which is something that is almost universally known throughout the United States.

So, the question is, if Rockefeller were to forcibly merge the California consortium and Li Changhe had to choose between the two, what choice would Li Changhe make?

Previously, the California consortium might not have considered this issue, but now they have to seriously consider it.

On this point, they must consider Victor's opinion, or at least know one of his inclinations, in order to avoid being utterly defeated in the future battle for control of the conglomerate.

After listening to James's words, Li Changhe sighed.

“James, you know that I’m not very willing to get involved in politics. For a businessman, especially for a businessman of foreign ethnicity like me, getting involved in politics in the United States is a very dangerous thing.”

James shook his head and said, "Vic, in fact, from the moment you set foot on this land, when your wealth accumulated at the top of this country, you have already become involved in American politics."

"No wealthy person can truly avoid American politics. Just like you, aren't you coming back now to support the Republican Party? Isn't it politics in itself?"

Upon hearing James's words, Li Changhe fell into thought.

He's considering whether to stir up some historical narrative here in California.

California is currently considered a stronghold of the Republican Party, and the California conglomerates are essentially part of it. This is largely due to their involvement in manufacturing; in a sense, manufacturing, military, and energy are intertwined, unlike the financial and capitalist Democratic Party. The core reason for California's potential shift to deep blue and becoming a Democratic stronghold lies in the Lowe family's recent acquisition.

Without Li Changhe's appearance, the California conglomerate would have been powerless to resist the encroachment of the Eastern conglomerate, and its core industries would gradually be taken over by Rockefeller and Morgan.

The result of taking it away was the relocation of manufacturing. For example, Lockheed later merged with Martin Marietta to become the famous Lockheed Martin.

The company is certainly impressive, but its industries are no longer in California, and the industrial workers and jobs have also left. California will then decline.

Later, the Democratic Party began to support California and the internet technology industry. The Democratic Party became the helmsman of internet technology and also made California a mecca for immigrants from all over the world.

Gradually, California changed from deep red to deep blue, and from staunch supporters of the Republican Party to staunch supporters of the Democratic Party.

Li Changhe knew James and his group's concerns. To put it bluntly, the military industry could leave, but their banks couldn't. Rockefeller might expand the military industry, but he might not be so interested in absorbing the banks.

At that time, the California conglomerate will fall apart, and without the support of the manufacturing industry, Bank of America will undoubtedly gradually decline and be slowly controlled by other conglomerates.

After thinking for a moment, Li Changhe finally spoke.

"James, let me share my thoughts with you first. First, I have a prediction about the future of business in the United States: the conglomerate model will become weaker and weaker!"

James didn't seem surprised by Li Changhe's words; instead, he listened attentively.

“James, American conglomerates are different from those in Europe and the East. In Europe, such as Britain, their conglomerates are often family-run. Just like my company in Hong Kong, as long as I am the major shareholder, I have the final say, and the other small shareholders have no say.”

"As for the conglomerates in the East, taking Japan as an example, their conglomerates are based on a bank core system. To put it bluntly, it means that a bank is the core, and all other affiliated companies revolve around this bank. The six major conglomerates in Japan, such as Mitsubishi, Mitsui, and Sumitomo, all follow this model."

"But the United States is different. In fact, I think that before this, American conglomerates had both of the above factors."

"Whether it's the so-called Rockefeller Group, your California Group, or DuPont, Morgan, from the initial shareholder control, like Rockefeller's oil trust, to the later bank control, such as Morgan's Morgan Bank, and the position of your Bank of America in the California Group."

"In fact, it's like you initially inherited the British conglomerate model, and later developed the Japanese conglomerate model."

Have you ever wondered why this change happened?

Li Changhe said softly.

James replied without hesitation, "Of course, I know very well, Vic, it's because of antitrust."

For Americans, if there is one business rule that is deeply ingrained in American business and cannot be changed, it must be antitrust.

The American transformation from breaking up trusts to building up commercial banking conglomerates actually stemmed from their fear of monopolies and their support for anti-monopoly efforts.

When oil and steel became trusts, the United States dismantled these trusts and suppressed oil tycoons Rockefeller and steel tycoons Carnegie and Morgan.

Later, when banks became the new core of financial groups, the United States began to suppress the banking industry. Morgan was split in two, and investment banking and savings businesses could no longer operate in parallel.

The same was true for Bank of America. In the 1970s, Bank of America's business surpassed that of Chase, and it also had a behemoth like Amtrak under its umbrella. Then it was investigated and suppressed by the US government, and Bank of America was forced to break up with Amtrak.

This is why James could blurt it out; after all, Bank of America was a participant and a "victim" of this experience.

Upon hearing James's reply, Li Changhe smiled and said, "Then James, you should understand what I mean."

"As long as the core principle of antitrust remains, it will be difficult for Rockefeller, the California conglomerate, or Morgan to form a monopolistic enterprise with a controlling nature."

"Because whichever company creates such a business is going against the entire United States, the US government will launch an investigation, and it will be attacked by everyone."

"You should know what the consequences of this model will be!"

After listening, James seemed to be deep in thought, and a glimmer of inspiration appeared in his mind.

"Vic, you mean to say?"

Li Changhe said softly, "Another business mindset brought about by the anti-monopoly principle is meritocracy. To put it bluntly, individual ability is more important than family control. Whoever has the ability should run the company. This is also the benchmark of liberalism!"

“Even DuPont, which has always insisted on family marriages and had the core of the family in charge of General Motors, now has an outsider sitting in the president’s seat. This is a trend.”

"So I personally believe that in the future, the United States may see giant companies, but there will be no more giant shareholders."

"Just like IBM, which is constantly under antitrust investigation and undergoing share splits, how much influence can its behind-the-scenes controllers still have over the company?"

"Can the Morgan family completely command Morgan Stanley now? Can Rockefeller completely control Chase Manhattan?"

“We can acknowledge that they have enormous influence, but they no longer have complete control as they did before.”

Do you think I'm right?

James nodded in understanding: "That's right, Vic. The current business situation is somewhat like what you described. So, what do you think we should do next?"

Li Changhe looked at James and then revealed the core intention he had just come up with.

"James, let's not talk about how Rockefeller and his family transformed their businesses. Let's talk about Bank of America first. At present, it's difficult for those families in the arms industry to resist Rockefeller's takeover. After all, their business model dictates that they need orders from higher levels and support from the top. Rockefeller has a firm grasp on this."

"But Rockefeller's model has actually provided you with some direction, hasn't it?"

"Rockefeller is integrating energy and military industries. In fact, its model is no longer simply based on a single trust or behemoth. However, it has shares and influence in almost all major companies across various industries."

"This model doesn't involve infiltrating individual companies, but rather infiltrating and controlling an entire industry, becoming the invisible controller of that industry. I call this model capital!"

"For Bank of America, I think your next step is to find a suitable direction, then imprint your influence into it, gradually shedding the shell of a California conglomerate and transforming yourself into a true 'California Capital' entity."

(End of this chapter)