Chapter 190: Taking Advantage of Landlord

After entering the 1980s, as Hong Kong's future was uncertain, some Hong Kong capital lacked confidence in the future and began to bet on both sides.

The middle class, in particular, have chosen to sell their Hong Kong dollar assets in preparation for relocating.

Moreover, due to the aggressive business strategies of banks, the loans of Hong Kong's commercial banks are overly concentrated in industries such as real estate and stocks, which are plagued by "bubbles".

Coupled with the serious imbalances in related industries such as real estate and stock markets, banks themselves are already at great risk.

The most famous events were the collapse of Xie Liyuan Gold Shop and the bank run on Hang Lung Bank.

On top of that, there were rumors rife in the market at the time that the RMB was about to replace the Hong Kong dollar, causing panic among Hong Kong residents.

Citizens began to lose their minds and lined up at bank windows that provided foreign currency exchange services to exchange their Hong Kong dollars for US dollars, fearing that the Hong Kong dollars in their hands would become worthless.

There was also a phenomenon of looting of daily necessities, and most supermarkets were emptied.

Some businesses have even begun refusing to accept Hong Kong dollars in order to avoid losses caused by exchange rates.

The panic spread further, and the whole of Hong Kong looked like the end of the world.

As a result, the Hong Kong dollar exchange rate has been under tremendous pressure, and the exchange rate of the Hong Kong dollar against the US dollar has been in a downward channel.

Since the middle of this year (82), the exchange rate has fallen below 6:1. This is just the beginning, and it will fall to a maximum of 9.6:1.

In order to save Hong Kong's financial system, the Hong Kong government later had to anchor the currency to the US dollar, with the exchange rate set at 7.8 Hong Kong dollars to 1 US dollar.

In any case, the Hong Kong dollar will depreciate by nearly 4% in the next two years.

Liu Zhicheng had already observed this through the financial report and fortunately he had been prepared, otherwise his assets would have shrunk severely.

When the negotiation was in progress, some newspapers in Hong Kong began to publish articles criticizing the British Hong Kong government in an effort to create favorable conditions for the negotiations, even resorting to the financial card.

“Whoever issues banknotes must be responsible to the citizens. Whoever issues the Hong Kong dollar must be responsible to the citizens.”

This was the headline of most media outlets, fiercely criticizing the British Hong Kong government.

Faced with the worsening Hong Kong dollar crisis, in order to stabilize Hong Kong's financial market, it decided to seek help from some wealthy people in the city.

On September 9, Liu Zhicheng came to the Hong Kong government and was personally received by Youde, who began to listen to proposals from all walks of life on how to deal with the Hong Kong crisis.

"Governor, Hong Kong is the starting point of my career. I am very worried about the current situation in Hong Kong and I urgently hope to make my own contribution to the prosperity and stability of Hong Kong."

After Liu Zhicheng finished speaking, he placed the plans for the Tin Shui Wai project, the Cha Kwo Ling project, and the Tai Lam Tunnel project on Youde's desk.

Liu Zhicheng plans to invest HK$500 billion in the entire Tin Shui Wai project, which will be implemented over ten years, with annual investment reaching HK$50 billion.

This does not include the HK$50 billion investment in Cha Kwo Ling and the investment in Tai Lam Tunnel.

After a moment, Youde expressed his support and was satisfied with the opening of the Tai Lam Country Park Tunnel and the improvement of traffic in Hong Kong.

Moreover, it promised to provide tax incentives to enterprises moving into Tin Shui Wai Electronic Plaza, and a 5% discount on the land compensation for converting industrial land to commercial land in Cha Kwo Ling.

Although Youde was in urgent need of launching several major projects to stabilize people's hearts, Liu Zhicheng decided to cater to his wishes and make his own contribution to stabilizing the exchange rate of the Hong Kong government.

"Du Xian, for the sake of Hong Kong's stability, I am willing to transfer US dollars from overseas and exchange them for Hong Kong dollars through Far Eastern Bank to stabilize Hong Kong's financial market."

Youde was overjoyed after hearing this and expressed his gratitude for Liu Zhicheng's contribution.

Out of consideration for his business reputation, Liu Zhicheng did not participate in short selling during the depreciation of the Hong Kong dollar.

But he did not rashly participate in the market rescue because he knew where the low point was. Now that the time is ripe, Liu Zhicheng must leave.

On September 9, the Hong Kong government announced a 12% interest rate hike and said it was studying measures to stabilize the Hong Kong dollar exchange rate.

At the same time, Whampoa Group also announced its own HK$500 billion investment plan, which eased the pessimism in the Hong Kong real estate industry and some people began to wait and see.

On the same day, Far Eastern Bank announced that Mr. Liu Zhicheng had mobilized huge amounts of foreign exchange from overseas to stabilize the Hong Kong foreign exchange market.

In order to benefit ordinary citizens of Hong Kong, each person is limited to exchanging US$50,000 per day.

The main reason for the restriction is that Liu Zhicheng’s US dollars are limited, and it is also to stabilize the emotions of ordinary citizens.

Ordinary citizens are the most insecure group of people, and they are the cornerstone of Hong Kong's future.

Liu Zhicheng prepared a total of 10 billion US dollars, which was enough for Far Eastern Bank to last until October 15th.

In order to prevent citizens from settling scores later, Far Eastern Bank broadcast through a small loudspeaker every day, asking citizens to remain calm and have faith in the Hong Kong government's ability to govern Hong Kong.

Liu Zhicheng is of course happy with those citizens who choose to hold Hong Kong dollars, but for those citizens who insist on exchanging them for US dollars and suffer exchange rate losses, it will be difficult to blame Liu Zhicheng in the future.

As of October 10, within this one month, Liu Zhicheng exchanged nearly US$14 billion (part of which was loaned from Citibank) through Far Eastern Bank.

This time, Liu Zhicheng made almost 40 billion Hong Kong dollars from the simple exchange rate difference profit.

Of course, Liu Zhicheng's act of using his own US dollars to exchange Hong Kong dollars for ordinary citizens was unanimously praised under the guidance of his own media, and he gained both fame and fortune.

Liu Zhicheng certainly wouldn't care too much about it. Everything has its pros and cons. Among ordinary citizens, there will definitely be people who criticize him and there will also be people who praise him.

He is not satisfied with his current achievements and is preparing to make a new layout to buy at the bottom.

There is a stock on the Hong Kong stock market, which investors call "No. 0008" because its stock code is . It is the Hong Kong Telephone owned by Hutchison Whampoa.

In its previous life, by the end of 82, the debt scale of Swire Properties was about to reach HK$100 billion, and it had to sell its properties to recover its losses.

In 83, Jardine Matheson sold its South African company for HK$13 billion and also sold a sugarcane plantation in Hawaii for HK$5.4 million.

At the same time, 38.8% of the shares of Hong Kong Telephone were sold to the British Eastern Telegraph and Wireless, cashing in HK$14 billion.

Even if these three projects cashed in more than HK$30 billion, it still could not solve the huge debt problem of Hong Kong Holdings. In the end, they had to sell HK Electric to Li Chaoren to solve the urgent problem.

Liu Zhicheng was attracted by No. 8 Hong Kong Telephone, not because it monopolized Hong Kong telephones, telegraphs, and international long-distance calls, but because he saw its telephone network.

The Hong Kong Telephone Company was the largest Internet provider in Hong Kong in the past, and it used dial-up Internet technology.

Liu Zhicheng just saw this point and made plans for the Internet he had in mind.

In this life, I wonder if Li Chaoren still has a chance to take over Hong Kong Electric. Thinking of this, Liu Zhicheng couldn't help but smile. ………

At the Sail Boat Hotel, Liu Zhicheng had an appointment to meet with the shipping king today.

The shipping magnate sought to abandon his ship and land, which was his established policy.

To outsiders, the charter king's disposal of old ships is a normal business behavior.

Only Liu Zhicheng, since he became friends with the ship charter king, had discussed this issue many times and understood the king's true thoughts.

He wanted to land not to recreate his past glory in a new industry, but to leave a stable family asset for his four daughters and sons-in-law.

Although it is not easy to abandon the ship, it is still not too late as long as you take it slow. After years of hard work, the shipping king has accumulated a lot of cash.

But landing is not so easy. The entire Hong Kong real estate market has long been controlled by traditional British capital and a dozen Chinese real estate upstarts.

The family of the charter king can indeed enter the real estate market, but under the current circumstances, they dare not act rashly.

Besides, due to the health problems of the charter ship king, it is impossible for him to start a new business in another field.

Therefore, acquiring an existing industry became his only choice.

Otherwise, he would not have acquired the wharf properties and real estate shares from Liu Zhicheng that year.

Today, Liu Zhicheng's purpose in meeting the shipping king is very simple, which is to kill Superman and make him a pure businessman.

As for Jardine Matheson, it is heavily in debt and needs to sell its businesses. Finding a suitable buyer has become Jardine Matheson's recent goal.

"Mr. Bao, long time no see. I hope you are well." Liu Zhicheng was waiting at the hotel early. When Bao Chuanwang arrived, he stood up and shook hands to welcome him.

"Mr. Liu, it's been a long time since we last met. However, you seem to be missed so much every day." The boat charterer said with a smile.

"I'm just lucky." Liu Zhicheng said with a humble smile.

In the business history of Hong Kong, the 80s was the decade when business dominance was transferred from Chinese to British capital.

The most fundamental reason is the change of Hong Kong bosses. British capital is afraid of being held accountable later, so they just flee.

If Chinese capital wants to grow bigger, it can only take over or forcibly acquire it.

"Mr. Liu is too modest. I have paid attention to everything you have done. Your success is a reflection of your accurate judgment and strength."

Liu Zhicheng did not dwell on this issue any further and asked, "Mr. Bao, when you bought shares of Zhidi last time, were you interested in Zhidi?"

"I did have this idea, but Shen Bi kept refusing, so I couldn't force him to buy it." The charter king shook his head and said.

In fact, the development of the shipping king is inseparable from the support of HSBC. HSBC is not only the financial backer of the shipping king, but also an important shareholder of Universal.

Liu Zhicheng suddenly said, "I know someone who is very suitable for Bao Sheng."

"Which one?" The boat charter king suddenly became excited. He had been unable to find a suitable target. If there really was one, then he would have a direction.

"What Mr. Bao actually wants is to stabilize his wealth and pass it safely to future generations, right?" Liu Zhicheng did not answer directly.

“Yes, the shipping market is unpredictable, especially in recent years, the oil crisis and regional wars have had a huge impact, so when it comes to making money, it’s naturally huge profits.

But if an accident happens, it is possible to go bankrupt. If a ship with a tonnage of tens of millions cannot find a customer, it will lose millions of Hong Kong dollars every day.
The risk is too great. I don't want my descendants to do this kind of business. The shipping market has just changed, and I want to take this opportunity to invest in some real estate and other businesses in Hong Kong.

Although real estate may also encounter a crisis, the worst that can happen is that the value will be cut in half, and the rent will be reduced. Unlike ships, it will not cost a lot of money to maintain and berth every day. "The charter king finished his thoughts in one breath.

"There's nothing wrong with this idea, but the Hong Kong real estate market is in a mess right now, and it's indeed a good time to buy at the bottom," Liu Zhicheng said, shaking his head.

"Mr. Liu, there's no need to beat around the bush. I know Mr. Liu is not asking me to buy the property market at the bottom." The charter boat king asked with a smile.

"What I did prepare for Bao Sheng was not a real estate company, but an industry that is more stable than real estate.

No matter what crisis we encounter, we will have plenty of business." Liu Zhicheng smiled and pointed to the lamp next to him.

"Mr. Liu, are you talking about electricity?" The ship charter king was a smart man, so he naturally would not think that Liu Zhicheng was talking about the desk lamp.

"Yes, it's electricity. No matter what economic crisis or real estate crisis there is, Hong Kong citizens, office buildings and factories all need electricity. And as the population of Hong Kong increases, the demand for electricity will only increase," Liu Zhicheng said with a smile.

"In fact, I have thought about this before." The charter king paused and said, "Hong Kong Electric is now owned by Hong Kong Land, and CLP is your subsidiary."

"Of course it's Hong Kong Electric owned by Jardine Matheson Land Development." Liu Zhicheng said with a smile: "To be honest, I have had ideas about Hong Kong Electric, but the Hong Kong government's laws do not allow it."

In the 60s, the two power supply groups, China Light and Power and Hong Kong Electric, considered merging to improve power generation efficiency and reduce the cost of laying the power grid.

However, it was strongly opposed by all the wealthy and powerful people in Hong Kong and several major British trading companies. They were probably worried that if a monopoly really emerged, everyone might become lambs to be slaughtered.

In addition, all the ordinary people also disagreed. In order to comply with public opinion, the Hong Kong government finally blocked the merger.

Although there are many monopolies in Hong Kong, even the two power groups have monopolies in their respective areas, but because there are two of them, they dare not go too far, so there can be a comparison.

"Mr. Liu has a good eye." The charter king nodded and said with a smile.

In later generations, there were a total of four most famous infrastructure companies in Hong Kong, which were described by the media as making money without doing anything. They were Hong Kong Electric, China Light and Power, China Gas and Hong Kong Telecom.

Electricity, like water, is the most basic need for a city's existence and is indispensable at all times.

The power transmission in Hong Kong has always been privately owned. The power plant supplying electricity to the entire Hong Kong Island is Hong Kong Electric, and the power plant supplying electricity to the Kowloon Peninsula is China Light and Power.

From the current perspective, the scale of HK Electric and CLP Power is similar. As for the future, it depends on their long-term operating capabilities.

"Bai Sheng, HK Electric has another advantage, which is that it has been operating in Hong Kong Island for a long time, has a long history, and owns a large amount of high-quality land, which will also be an important source of profit in the future," Liu Zhicheng continued.

"It seems that Mr. Liu is full of confidence in the future of Hong Kong." The charter king thought for a while and said, "According to Mr. Liu's analysis, this is indeed a good deal. But should I stop it, or what should I do?"

He is a shipping king, and he is one of the world's top shipping companies, but he has no experience in acquiring companies. In his previous life, the charter king relied on great strength to make acquisitions happen.

"Let's take over peacefully. I just happened to be eyeing the telephone company under Jardine Matheson Land Development. Jardine Matheson Land Development is now heavily in debt. Why don't we go to the British Empire together?

It is our responsibility to have a friendly negotiation with the Keswick family and help them out of this predicament." Liu Zhicheng said with a smile.

(End of this chapter)