Rebirth Tokyo 1986

Chapter 234: Four Asian Tigers

At the end of the new year, on the first day of the Tokyo Stock Exchange's official opening, the stock market fell in a very embarrassing way.

"Professor Tokugawa, what do you think of today's stock market situation?"

"It's just a technical adjustment, there's no need to worry about it."

"The Nikkei 225 index will soon break through 4 points, and climbing to 5 points is not a dream."

"Our Japanese economy is unrivaled in the world, but our stock market is far from matching it."

Tokugawa Akihiko waved his arms, his voice full of confidence.

My country is so powerful that a slight drop in the stock market is of no consequence and it will rise again soon.

"Fanatical believers, they are so scary."

Masato Takeshita sat on the sofa, looking with emotion at the university professor in front of him who was crazily advocating the Japanese economy.

If he was not a time traveler, he might have been persuaded by those inflammatory words.

Because this professor truly believes everything he says on TV.

Not only did he mortgage his house to invest in stocks early on, he also brought his family along to invest in stocks.

Because I entered the market early, I did make a lot of money, but I don’t know if I can withstand the next big drop.

If you are not so greedy, you will at most give up a portion of your profits.

If you are too greedy and use too much leverage, not only will you vomit out everything you eat, but you will also owe a huge amount of debt.

"President, do you also think it is a technical adjustment?"

"What do you think?"

The young man looked at his secretary general and asked back with a half-smile on his face.

Keiko Sakai thought calmly for more than ten seconds, then responded cautiously.

"Well, I think the possibility of continued growth is slim."

"The central bank has raised interest rates several times, which has attracted a large amount of funds to bank deposits, and the funds in the stock market have begun to decrease."

"More importantly, President, you have completed the divestment."

Secretary Sakai was not clear about the specific affairs of Xinghai Investment at first, but so much time has passed that the news of the chairman's withdrawal of investment has spread within the Xinghai Group.

The vast majority of employees who had purchased Japanese stocks followed the young man's footsteps and retreated after hearing the news.

But there are also some who refuse to give up and still stubbornly hold on to the stocks they hold.

Keiko Sakai belongs to the former and withdrew her investment and ran away early.

He believed in his own president far more than the so-called experts.

"Very good. In that case, trust your own judgment."

The current central bank governor, Yasushi Mieno, believes that Japan's stock and property markets are in huge bubbles and that tough measures must be taken.

Therefore, starting from June last year, the central bank began to raise interest rates aggressively.

It would be fine if it was just a rate hike, the Japanese stock market could still withstand it.

After all, the returns from the stock market far exceed bank interest.

What’s worse is that the central bank has ordered a contraction in lending business.

The era when one could easily get a loan even if they had nothing will never come back.

This was a complete buzzer beater.

The current Japanese stock market is a highly speculative place that requires huge amounts of funds to continuously push it up and support it.

It is somewhat similar to the Chinese real estate industry in the future.

As prices continue to rise, many people will choose to purchase with loans, even if it is difficult to repay the loan, they will still force it.

Not rising anymore.

Then many people will choose to wait and see.

If more people wait and see, real estate companies will be unable to bear it and will be the first to choose to lower prices.

Gradually, falling housing prices became the general trend.

The same principle applies to the stock market.

As the amount of funds decreases, the Japanese stock market has shown signs of not being able to sustain itself.

Many capitalists had a bad premonition and were secretly withdrawing while encouraging the public to continue to increase their efforts on television and other media.

It can be said that the Bank of Japan's various tough strategies have indeed effectively cracked down on speculative behavior in the stock market.

The central bank had not anticipated the possible serious consequences.

They simply and crudely believe that if the Japanese stock market falls, companies will return to traditional manufacturing.

Large companies will also increase their investment in research and development again.

Unfortunately, things don't turn out that simple.

Most companies will be frightened by this stock market crash.

Not to mention R&D investment, even marketing investment has begun to shrink.

Japanese companies have become more interested in hoarding large amounts of cash rather than investing in research and development.

Survival is always the most important thing.

Storing large amounts of funds is good for individual businesses, and the company's ability to resist risks is greatly enhanced.

However, such things will seriously hinder the development of the country.

Because there is a limited amount of money in the market.

If companies store too much, market liquidity will be greatly reduced, resulting in deflation.

At the same time, the company's investment in research and development will be insufficient.

This is the right thing to do for traditional industries.

Because traditional industries develop slowly, you can get super high returns without investing too much.

But for emerging industries, conservative management can be fatal.

Emerging industries, especially the semiconductor industry where Japan currently dominates, are industries with strong cyclical fluctuations.

Usually there are a few years of huge profits and a few years of losses.

What semiconductor companies need is to produce hard and accumulate more funds in the profitable years, and then build factories on a large scale in the loss-making years.

In this way, when the factory construction is completed, you will catch up with the industry's profit cycle and earn more money.

Samsung Electronics and TSMC are experts in this field.

Therefore, the status of these two companies in the semiconductor world continues to rise.

Japan is a negative example.

Because they were frightened by the stock market crash, they dared not invest more when the semiconductor industry encountered a downward cycle, for fear of losses and bankruptcy.

As a result, Japan's semiconductor market was quickly divided up by South Korea and Taiwan, and even the United States got a piece of the pie.

Of course, the collapse of Japan's semiconductor industry is also due to the loss of the end-consumer market.

In the second half of the 20th century, Japanese electronic products were marketed around the world.

Japanese semiconductor companies have also achieved rapid development through this.

In the 21st century, Japan's electronic products are in decline.

Whether it is computers or mobile phones, sales have been relegated to other options.

Without the support of electronic products, the semiconductor industry is bound to decline.

The situation in Europe is actually similar.

As companies such as Siemens, Alcatel, Philips, and Nokia gradually withdraw from the consumer electronics market.

Europe's semiconductor industry is also gradually dying out.

South Korea is another story.

Due to the rise of companies such as Samsung and LG in the consumer electronics market, the semiconductor industry quickly became a pillar industry in the country.

As for Taiwan's semiconductor industry, it is the result of the strength of American electronic products.

American electronics brands have re-emerged in the 21st century, regaining the world's top spot from Japan.

But the labor costs in the United States are too high, so it can only place its industries in dependent territories.

Taiwan is the best in this area, so we gave the OEM business to Taiwan.

However, with Masato Takeshita in this world, it is difficult for Japanese consumer electronics to completely decline.

Therefore, Japan's semiconductor industry chain would not suffer such a terrible defeat.

Of course, don't even think about being the only one standing out like you are now.

This kind of thing will not be allowed by the United States, Europe, or even our neighbors next door. Japan can be one of them, but it cannot be the only one.

There weren't many things to do at the headquarters, so after simply dealing with them, Masato Takeshita stretched.

"Ah~"

"Sakai-san, let's go to Xinghai Investment."

"Hi!"

When he arrived at Xinghai Investment, Masato Takeshita didn't bother to say hello and asked directly.

"Kamoto-san, how much Japanese yen does the company have left?"

"The company still has nearly 5 million yen to process."

It is impossible to convert all the 700 billion to 800 billion yen in cash into US dollars at once.

This amount of US dollars is equivalent to Japan’s foreign trade income for more than half a year.

If the scale is too large, it will cause concern among government departments.

What do you mean?
Such a large-scale capital flight.

Masato Takeshita crossed his legs and thought about it.

"Well, that's it."

"We are now investing in Hong Kong stocks and Korean stocks among the four Asian tigers, as well as all of the four Asian tigers."

“These places recognize the yen, which can speed up the processing of assets.”

If the only contribution of Japan's bubble era is to be said, it must be that the Japanese yen went global and became one of the world's currencies.

Through world monetary policy, most countries in the world have begun to recognize the Japanese yen.

Especially in places where the economy is obviously not as good as Japan, even if the yen is not as good as the US dollar, the difference is not much.

"The Four Asian Tigers?"

Hong Kong stocks and Korean stocks were targets that had been determined long ago, while Indonesia, Malaysia, Thailand and the Philippines were the investment targets that Masato Takeshita thought of during the Chinese New Year.

This will be the protagonist of the future Asian financial crisis.

At first, he was completely clueless and paid no attention to these countries.

It was only when I happened to see a travel program that I realized what I had missed.

This was the fastest-growing country in Asia in the 1990s, and we must take advantage of the dividends.

As for quitting, that's even simpler.

Whoever is buried inside, it won’t be Xinghai Investment.

"Yes, these countries have developed very well recently. We can buy some stocks of leading companies."

"Especially the giants in real estate, finance and telecommunications should increase their investment."

The prosperity of the four Asian tigers is entirely based on the substantial appreciation of the Japanese yen and the transfer of low-end industries from Japan.

But except Malaysia, these four little tigers are a bit eager for quick success.

Instead of learning from Japan in the 1960s and 1970s, China learned from Japan during the bubble era and frantically increased its investments in real estate and finance.

Especially Thailand, which has learned the most, even crazier than Japan.

Because Thailand saw the opportunity of Hong Kong's return in 97 and wanted to replace Hong Kong as one of the world's financial centers.

Unfortunately, Thailand has completely ignored the special status of the port city.

The reason why Hong Kong has become a world financial center is basically because it is China's largest window to the world.

Thailand has no window effect and its geographical location is very ordinary, so it is impossible for it to become a world financial center.

It's good to have a big heart, but not too big.

It’s no wonder that this castle on the beach will break into pieces if touched in the future.

"Understood. I will arrange for someone to go to Thailand to collect industry information."

It was only because this happened suddenly that Kamoto Takamasa asked subconsciously.

In fact, his understanding of the details of the Four Asian Tigers may be much deeper than that of Masato Takeshita.

Because of the wave of Japan going overseas in recent years, Southeast Asian countries are a major destination.

Countless Japanese companies have transferred low-end manufacturing to Southeast Asia due to cheap labor and obstacles from the United States.

Toyota is one of the best.

Regardless of the country, automobiles are a pillar industry.

The United States is no exception.

The three major automakers and their affiliated companies provide livelihoods and clothing for millions of American workers.

In order to protect its own automobile industry, the United States has repeatedly launched trade wars against Japanese cars.

Toyota is the protagonist among them and receives the most attention from the United States.

In desperation, Toyota could only transfer part of its production capacity to Southeast Asia, which was not targeted.

It is somewhat similar to Chinese companies after 2016 in the previous life.

When its own company was targeted, it transferred part of its production capacity to Southeast Asia and Mexico.

Because Thailand offers more favorable policies, Toyota Motors finally chose to settle here.

Subsequently, many automobile companies and auto parts companies also chose to build factories in Thailand.

Thailand has had a great time during this process.

Soon, it became the automobile production center of Southeast Asia.

Economic development is also getting faster and faster, with the average annual GDP growth rate remaining stable at above 9%.

"Different people will go there several times, and then buy several copies of the information from the consulting company for comparison."

"Hi!"

When it comes to money, you can never be too careful.

He didn't understand the stock markets of the four Asian tigers, so he naturally had to be extra careful.

“Also, the data on the emerging telecommunications industry must be detailed.”

“I need to understand their development and strategic planning.”

"Especially the bosses of these telecommunications companies, there must be enough detailed information."

Masato Takeshita's main target was the Thai Sivana family.

This is the family of Thailand's future Prime Minister Thaksin Shinawatra, and also the most prestigious political family in Thailand in the future.

But other telecom companies cannot be negligent either.

Xinghai Mobile needs to cooperate with these telecom companies.

Thinking of the Xinghai mobile phone, Masato Takeshita could no longer sit still.

He returned to Xinghai Semiconductor and found the company's president, Lou Gerstner.

“How much funds does the company have?”

"About 3400 billion yen can be withdrawn without affecting production."

Xinghai Semiconductor has sufficient funds and ample cash flow.

Of course, most of these are five-year loans borrowed before the Bank of Japan raised interest rates in June last year.

Xinghai Semiconductor has always been pursuing a debt-based operating strategy.

This is also the common route for most companies in their development process.

A company that does not operate with debt, or has only a small amount of loans, is an outlier in its development.

As long as the company is not as crazy as Evergrande in the future or the current Korean conglomerate, some debt will be beneficial to the company's development.

For example, Xinghai Semiconductor.

If we had not chosen to operate with debt, we might still be a small shrimp now.

I don’t know when it will develop into a large semiconductor company with tens of thousands of employees and four wafer fabs.

"Very good. The company will allocate part of its funds to invest in telecommunications giants in Southeast Asia and Latin America."

"Xinghai Mobile needs to go abroad and become a shareholder of a local telecom giant, which is the best way to cooperate."

The share prices of telecom giants in developed countries are too expensive, and Xinghai Semiconductor cannot afford to play with them for the time being.

This part of the resources requires the help of Xinghai Investment.

Xinghai Semiconductor only needs to be responsible for a small number of backward countries and regions.

“Southeast Asia is fine, but Latin America may be short of funds.”

(End of this chapter)