A century-old wealthy family that rose from Shanghai

Chapter 227 Shipping Dispute
Chen Guangliang arrived at the Yarn Exchange, and it was indeed very busy, not affected at all by the flood outside.

People continue to dance, horses continue to race, and stocks continue to be traded. This is how the world has always been.

In Shanghai at this time, wherever there is "speculation", there must be a large number of people, because everyone really likes to "get something for nothing"!

So from the "Gold Exchange" to the "Chinese Commodities Exchange (stocks and bonds)", and then to this "Yarn Exchange", they are all full of speculators.

"How's the situation here?"

Upon hearing this, Hu Jinshun vividly described it: "The market is good. It has been rising since June and has now reached over 6. Recently, people have been saying that the flood will inevitably drive up the price of cotton yarn, so they are chasing the increase!"

In July, Changjiang Bank made a profit of more than 7 yuan.

Starting from August, Changjiang Money House once again bought 8 million cotton yarn futures and has made a profit of more than 100 so far.

Of course, these are just minor things for futures!

Chen Guangliang said, "I've asked Wu Xinhe to mobilize funds and prepare to increase the margin. By then, there will be a limit of 500 million. But for now, hold off and wait for my instructions."

This increased margin is the money for opening a bank. Anyway, the bank is still in preparation, so let's take a chance first.

Hu Jinshun vaguely understood that the boss was definitely not chasing high prices, but was probably selling short. Otherwise, he should have had a 500 million yuan limit from the beginning.

"OK, I see!"

At this moment, an 'early financial landscape' had already formed in Chen Guangliang's mind.

On September 918, the Northeast fell, which meant that cotton yarn lost the Northeast market (which was very important). Then the cotton yarn giants would inevitably join forces to short sell, and the price would inevitably fall.
At the same time, the British pound depreciated by 30%. Chen Guangliang borrowed a total of 35 pounds, and could repay 10.5 pounds less, which is almost 200 million yuan.

Subsequently, countries gradually abandoned the "gold standard", which meant that the currencies of various countries depreciated, and gold ushered in a second round of sharp increases. The gold-silver ratio rose from 65 to a high of 80, which was an increase of more than 20%.

With just these three pieces of useful information, Chen Guangliang could make millions.

"Guangliang, you're here too?"

Du Yuesheng was the first to notice Chen Guangliang and walked up to him with a smile.

Chen Guangliang came to his senses and immediately moved to stand with Du Yuesheng.

"Well, come here and see if there's any chance!"

Du Yuesheng asked with great interest, "Do you see any opportunity?"

Chen Guangliang replied, "Hasn't the opportunity already come? The price of cotton yarn has been rising quite a bit recently. It's a pity that I invested very little and only made a small profit of tens of thousands."

Du Yuesheng smiled and said, "You, Chen Guangliang, have come to this day. You missed the opportunity to make money, right?"

It was obviously a joke. The two had always had a good relationship and there was nothing serious about them getting along. Instead, Du Yuesheng helped Chen Guangliang.

Chen Guangliang whispered, "What if I'm fishing?"

Du Yuesheng immediately understood what Chen Guangliang meant and said, "Come on, let's go to my office and talk!"

Back then, he and Zhang Xiaolin had teamed up to short sell, earning them a beating from the cotton yarn tycoons. But Du Yuesheng was no ordinary man, resorting to ruthless tactics and falsely accusing the Rong family of market manipulation. The lawsuit dragged on for years. Later, the Rong family received a bullet casing, frightened enough to ask someone to mediate. Du Yuesheng, therefore, became a director of the Yarn Exchange, extending his influence there.

Chen Guangliang followed Du Yuesheng to his office.

After sitting down, Du Yuesheng said, "Guangliang, what kind of fish are you fishing for? Tell me."

Although he entered the cotton yarn exchange, he did not make any money from it.

To be honest, Du Yuesheng was not a businessman. He lost money in many places, but in the end he used gangster tactics to settle them. Of course, he had to swallow the bitter fruit of the loss of funds in some places.

For example, he lost 600,000 yuan in the cotton yarn exchange, and this was in the late 1920s.

Chen Guangliang said: "This cotton yarn has been rising since June and is now 241 yuan. I plan to find a time to sell it short."

Now that he is engaged in shipping, he has to ask Du Yuesheng for help, because the Green Gang plays a big role in port and terminal matters.

So, I revealed an opportunity to Du Yuesheng and treated it as a deal.

Upon hearing this, Du Yuesheng said angrily, "Guangliang, don't you know that this cotton yarn exchange is heavily controlled by those textile giants? If you're not careful, they can drive up the price of cotton yarn and make you lose a lot of money. What's more, now that the floods may cause production to fall, they will be even less likely to let you short sell!"

Textile tycoons usually sell cotton yarn during the textile off-season and then buy it back during the peak season to reduce costs.

This method has been proven to be effective.

Chen Guangliang smiled and said, "It seems that Mr. Du also wants to get back at this place!"

Du Yuesheng immediately said, "As long as you are sure to help me regain my position, I will help you deal with any problems at the dock in the future!"

"A word is settled"

"A word is settled"

Chen Guangliang immediately said, "The time is not right now. When the opportunity comes, I will inform Mr. Du. Don't worry, if Mr. Du loses face again, I will have no choice but to pay compensation."

Du Yuesheng was also a man who could accomplish great things. Although he was skeptical, he decisively said, "Okay, I'll wait for your notification."

He doubted whether Chen Guangliang could defeat the textile tycoon, but at the same time he felt that Chen Guangliang controlled the newspapers and might start a public opinion war.

In short, he wants to follow!

Chen Guangliang immediately said, "Mr. Du has his own agent, right?"

Du Yuesheng said, "Agent cards No. 52 and No. 76 are both mine. Do you want me to get you another agent card so you can be more discreet?"

Chen Guangliang said directly: "No need, I'm playing an open card!"

Du Yuesheng was stunned, but he had to suppress his curiosity and wait and see how this young man would help him win back face.

As for Chen Guangliang's entry into shipping, after all, his business is mainly in inland rivers and near-sea areas, and he is not in direct competition with him. The two are not competitors for the time being.

Zhu Baozhong was a broker at the Cotton Yarn Exchange. Every day he would go to the Sanxin Company Building on Jiangxi Road to ask for instructions and report to Rong Zongjing because he was Rong Zongjing's man.

The Zhu father and son who were the agents for Shenxin's business were loyal to the Rong family, and Rong Zongjing had absolute trust in Zhu Baozhong.

"Boss Rong, someone spotted Chen Guangliang walking into Du Yuesheng's Yarn Exchange office today!"

After hearing this, Rong Zongjing said, "I remember that Chen Guangliang only had minor incidents at the Yarn Exchange, and Du Yuesheng isn't playing around much these days, is he?" Zhu Baozhong said, "Well, with the two of them getting involved, is there something fishy going on?"

After some thought, Rong Zongjing said, "That's certainly possible, but cotton yarn prices are rising. First, it's the textile season, and second, production is expected to decrease. Even if we wanted to suppress the price, the timing is wrong. So, you hold them off for me and see if they're planning any major deals. Report back to me if anything happens."

"Ok"

In Rong Zongjing's view, the "Yarn Exchange" should serve the textile manufacturers - to reduce costs, and those who speculate in cotton yarn futures should contribute their money to them.

Based on this idea, these textile tycoons can always unite and jointly manipulate the market.

They are still very vigilant against invasion by outsiders.

The two bosses of Jardine Matheson and Swire soon met together to discuss countermeasures.

At the outset, Du Baili bluntly stated, "Chinese people are also worthy of being masters of the ocean. I think this young man is blindly arrogant and wants to come in and get a piece of the pie."

Shi Yueke asked cautiously, "Those four ships must be worth at least four or five hundred thousand US dollars. I heard he's well-established in real estate and finance, and is now investing in shipping. Furthermore, he might have the support of the Southern Whale government!"

"Haha," Du Baili said, "The Nanjing government's China Merchants Group is already struggling. If they don't borrow a huge sum of money, they'll go bankrupt sooner or later. They're supporting a private shipping company to fight us. I think they're desperate. The reason we asked you to come here for this negotiation is to bring down this shipping company."

Shi Yueke nodded. Swire Shipping was an important business for them, even more important than Jardine Matheson's shipping assets, so he was happy to suppress Global Shipping.

"How to defeat it?"

Du Baili said: "It's the same old routine. We will lower the freight rates and crush Global Shipping first. Then we can raise the prices and we won't suffer much loss."

That's what a monopoly is - first lower the price to gain a monopoly, then raise the price so there are no competitors.

Shi Yueke asked, "Should we notify the Chinese and Foreign Trade Association?"

Du Baili said, "They don't have this fixed route, so there's no need to notify them. Besides, we just want to catch this newbie off guard."

"Okay, we at Taikoo will follow suit and lower the price."

Immediately, the two sides began to discuss how much the price reduction would be appropriate.

They believe that this price is a temporary price reduction and will go back up after Global Shipping withdraws from these two routes.

Therefore, the price needs to be reduced a lot, a big reduction!

In early September, just two or three weeks after opening the new shipping routes, global shipping was faced with suppression from imperialism. Jardine Matheson and Swire jointly announced that the freight rates on the two routes from Shanghai to Qingdao and Tianjin, and from Shanghai to Xiamen, Shantou, Hong Kong and Guangzhou would be reduced by 9%.

The incident happened suddenly, leaving many people stunned.

Generally speaking, the price of shipping is negotiated by the "Chinese and Foreign Shipping Association" and must at least be reported in advance.

Now Jardine Matheson and Swire have launched a sudden attack without any prior notification, which is clearly an attempt to suppress the development of China's shipping industry.

But so what? The country is weak and can hardly take care of itself. Who will support global shipping?

In addition, those customers only care about getting cheap freight and don’t care whether the liner is foreign-funded or Chinese-funded.

For a while.

Many people have started to watch the fun. After all, Swire and Jardine Matheson have cut their prices by 30%, which is probably a "loss-making" competition.

"Global Shipping is in dire straits now. Their ships are already large, and if they follow suit and keep the same freight rates, they will lose even more. If this continues, no matter how rich Chen Guangliang is, he will be very weak in front of these two giants, Jardine Matheson and Swire."

"That's right. The key is that the freight costs are the same, so Chinese capital is still at a disadvantage. Generally, merchants will choose foreign merchants with better reputations at the same price."

"That's 200 million! These four ships of Global Shipping are said to be worth 200 million. If Boss Chen continues to lose money, he'll be making even more losses."

Most people are pessimistic, as they have no idea of ​​Chen Guangliang's strength.

Chen Guangliang also urgently convened a management meeting to discuss countermeasures.

Zhao Tieyi said decisively, "Boss, we have to follow the price cuts, otherwise it will be difficult for us to compete. Besides, Global Shipping has no debt. We just need to hold on for a while, and Jardine Matheson and Swire will come to negotiate with us. They simply believe that they can defeat us with a price war. But as long as we show our strength, according to the inertia of foreigners - they always bully the weak and fear the strong, then everyone will return to the negotiating table."

Chen Qingfeng, the head of ship management, also said: "From past experiences of shipping between Chinese and foreigners, it can be seen that foreigners are indeed bullies who are afraid of the strong and bully the weak. The way to deal with them is to first strive for excellence ourselves, and then use all our strength to fight them to the end."

Everyone agreed with the two people's point of view, which was to follow the price reduction.

This price reduction is the same as that of Jardine Matheson and Swire. Although it does not have an advantage, at least we are on the same starting line.

If Global Shipping works harder on service and management, it will surely be able to "stand on equal footing".

Chen Guangliang was very satisfied to see that everyone was in high spirits.

Of course, this fighting spirit is based on their strength. As you can see, Global Shipping has no debt at all, and the price of these ships is unimaginably cheap.

Such strength is enough to compete with Jardine Matheson and Swire in price wars, because everyone knows the character of foreigners and they will eventually come to the negotiation table.

But, is Chen Guangliang the kind of person who "passively takes a beating"?

Obviously not.

Chen Guangliang then said:
"If foreigners lower their prices to suppress us, we should naturally fight back. But if that's all, how can we be worthy of the word 'global'? So I decided:

First, our prices are the same as those of Jardine Matheson and Swire;
Second, we will issue a notice in all our branches: From now on, all merchants who choose our global shipping service will not only enjoy the same low shipping rates as Jardine Matheson & Swire, but we will also donate every cent of their shipping fee to the flood relief efforts in their own name, either personally or as a token of our Chinese solidarity.

If you want to fight, you must fight to boost morale.

During these three months, he even paid money to compete.

Everyone was shocked. You know, the fuel and labor costs are not low, especially for those senior seafarers. Not only do they have to be hired with high salaries, but some foreigners even bring their families to live on the ship and have to be supported.

"Yes, boss"

After all, everyone believed in the boss's ability, quickly followed the arrangements, and prepared to deal with this storm.

Chen Guangliang also seriously considered this plan and felt it had great potential:
First, if the 918 Incident broke out, national unity would be unprecedentedly strong, and the boycott would not only be directed at Japan, but also at the other powers. At that time, his shipping company would definitely have a better business environment.

Second, it was Swire Properties that initiated the malicious price cuts, and it was reasonable for him to follow suit; he donated the freight in the name of his customers, which was a moral high ground.

Third, although he might lose a few months of freight, he has established a firm foothold in these two routes, which will be enough to make it back several times over in the next six years.

It is a crisis, but more of an opportunity!
(End of this chapter)