Chapter 228 - Good News
Feng Yu and Norio Ohga did not sign the contract after their discussion as Norio Ohga still needs to report this matter to the board. After the Board of directors agreed, then he would sign the contract with Feng Yu. Norio Ohga promised Feng Yu that it would not be difficult to get the approval.
Feng Yu also felt that it should not be a problem. Aiwa had reduced its debt these two years, but the amount it owned was still a lot compared to its market value. Aiwa even wanted to build new factories and the debt will increase further. Heitaro Nakajima’s management had made lots of Sony’s shareholders unhappy.
You are already in debt, and yet you still want to expand?
Sony was also not doing well in the past two years, and they had no reason to refuse Feng Yu’s offer. Norio Ohga promised Feng Yu that he would get back to Feng Yu within one week and would come over to China to sign the contract.
Feng Yu happily returned to Bing City to prepare for his final exams. After he entered Arts stream, he needs to memorize more things, but this was what Feng Yu was good at. With his knowledge from his previous life, Feng Yu’s results were much better than his first year.
......
The form teacher was standing in front of the class encouraging the students. He was telling the students to not be nervous about the exams when Feng Yu’s pager beeped.
Before the teacher asked Feng Yu to stand outside the class, Feng Yu walked out of the classroom. The rest of the students knew that Feng Yu would not obediently stand outside the class. Once Feng Yu was out of the class, he would disappear.
“The newspaper, read the newspaper now! !” Li Shiqiang was shouting excitedly over the phone.
?
“Mr. Sun, do you have today’s newspaper?”
“Me? I only read last week’s papers. If you want to read today’s papers, you can go out of the school, and there’s a newspaper stand on the left after the first junction.” The school’s newspapers were only for the school’s leaders. After the leaders finish reading, it would be passed on to the teachers and then passed to Mr. Sun.
Feng Yu ran out of the school for the newspaper stand.
, found it!
“The State had decided to establish a stock exchange at the end of August to early September. The 18 companies which will be the first batch of companies nominated to be listed are Vacuum electronic, …… “
Hahaha, the stock exchange was set up earlier than before!
18 companies were going to be listed on the stock exchange. Feng Yu remembered that only 13 companies were listed in his previous life. Among these 13 companies, 8 were from Shanghai and 5 from Peng City. These 13 companies were later known as Shanghai 8 and Peng 5 shares by the investors.
It was because these 13 shares were like being possessed and the prices kept soaring!
When Feng Yu was acquiring the shares, his main priority was these 13 companies’ shares. But he also bought other shares as those companies would be listed too. The coming year would be China’s first bull market!
Feng Yu felt that these 13 shares would rise at least 8 folds and Vacuum Electronics would increase over 20 times! Because of the other stocks, Feng Yu told Li Shiqiang and the rest that the profits will range from 3 to 5 folds. But now, if the number of listing companies increases, then he might be earning even more.
The State had chosen more companies to be listed might be due to their studies that the stock market could stimulate the country’s development. If it were only 13 companies, there would be too little shares. At least, Feng Yu could tell that the economists now were more willing to take the risk than his previous life.
But there might be another possible outcome. Now, more companies were being listed, and investors had more choices. There might be the possibilities that some stocks might not rise so fast.
But Feng Yu had researched on China’s current policies, and there was not much different from his previous life. The policies were encouraging people to invest in financial instruments, increase spending to promote economic growth. So, the stock market now would be as prosperous as his previous life. The share prices will rise!
Feng Yu now have over 2 hundred million worth of shares, and it was not enough for him to be a big player. On this day next year, Feng Yu’s shares would bring him profits of more than 3 times his investments.
It was not easy to be a big player now. Transactions were done in person, and if the transacted amount were too significant, it would be easy to attract unwanted attention. What if some government officials took notice of Feng Yu?
Feng Yu’s strategy was to wait. The stock exchange had just started, and there are only a few million RMB worths of transactions daily. In Feng Yu’s previous life, the stock market boom happened only after the “Great One” gave a speech during his visit to the South. It was in 1992, around May. The stock market soar by over 100% for consecutive few days. During that time, there were still not price limit policies to reduce the volatility and stabilize the market.
Since the stock exchange had been brought forward, then would the “Great One” visit to the south be brought forward too? Will the bull market start earlier?
Feng Yu felt that it was highly possible!
Moreover, Feng Yu could also use a small number of his shares to do trading. The profits from doing trading will not be low either, and it was not illegal. The only issue was that it was troublesome.
There was no online trading in this era, and Feng Yu could only trade over the counter!
Trades can still be conducted at the banks over the counters, but the share prices will not be the same flatulate fast like the stock exchange. There was still no internet now, and if you buy the shares in the morning, you might have to wait until late afternoon to find out that the shares prices rose. The efficiency was terrible!
……
Feng Yu was sitting in Tai Hua Trading’s meeting room, to share the good news with everyone.
After the stock exchange was set up, the stock prices will surely soar after the initial surge and next year, the value of their shares would be at least doubled!
Everybody was excited. When Feng Yu told them that in 1 to 2 years’ time, their shares will soar by two to three times previously, they were still a bit spectacle and worried. But now, the share prices were increasing.
Today, after announcement, Li Shiqiang and some of the staffs went to the banks to ask. The share prices did increase slightly.
Although the sudden surge did not appear, they had already made some profits. Now all of them believed what Feng Yu said.
After the meeting, everybody was still excited, especially Li Shiqiang. Now he felt that Feng Yu was right to ask him to take up loans to buy shares!
The interest from the loans cannot be compared to the increase in stock prices. He was now eagerly waiting for the completion of the stock exchange. The sooner the exchange starts operating, the earlier he would see his money!
Feng Yu was holding his chin thinking about the stock market. Next year’s January, the stock market would slow down, and Feng Yu planned to sell sold off his shares to trade in futures. After that, he would reinvest all his money into the stock market. By that time, his assets would be enough for his to do a lot of things……
Author’s notes: When securities companies were introduced, shares were still in paper forms, and people still go to the banks to trade. Price limit policies started in 1996 to prevent anyone from manipulating the stock prices.