pjbooks Chapter 333 Bloodshed on Wall Street
Chapter 333 Bloodshed on Wall Street
Chapter 333 Bloodshed on Wall Street
New York, Manhattan.
If there is one place in the world where the carnival never ends, it must be Wall Street right now.
In the Waldorf Astoria's rooftop ballroom, the crisp popping of champagne corks echoed throughout, mingling with the smoke of top-quality cigars, filling the air with a psychedelic atmosphere. Meanwhile, the Nasdaq index had followed a dazzlingly steep parabola over the past year, with the Nasdaq Composite Index just breaking the 5,000-point mark.
In this crazy spring, traditional value investing theory has been completely thrown into the trash.
In a corner of the banquet hall, a young man of only twenty-four, who hadn't even graduated from university, was holding a martini, surrounded by a group of seasoned Wall Street fund managers in suits. This young man had founded a shell company with only a ".com" domain name, whose most basic business plan was incoherent and nonsensical. Its core business was simply selling pet food online, and it lost money on every bag sold.
But that didn't stop him from ringing the bell on Nasdaq and raising a large sum of cash on the first day with a valuation of $500 million.
"Those old fogies who're still looking at P/E ratios and traditional factory financial statements should have been eliminated by the times long ago!" A hedge fund partner, his face flushed, mocked the steady, traditional industrial capital with a red Windsor knot. "It's an attention economy now! Traffic is king! As long as your company name includes 'Internet,' even if you're selling air online, you can double your money on NASDAQ tomorrow!"
Greed blinded everyone. In this game of musical chairs, everyone believed they could sell their worthless pieces of paper—with price-to-earnings ratios of hundreds of times or even no profit at all—to the next fool before the music stopped, at an even higher price.
No one believed the grand feast would stop.
However, it was quite different from the glitz and glamour of the Waldorf Astoria Hotel.
A few blocks away, in the top-floor trading room of the Kitahara Group's North American branch building, the atmosphere was as quiet as an icebox.
On the huge, curved electronic screen, red and green candlestick charts were flashing wildly. Hundreds of traders sat in front of their computer screens, and apart from the crisp sound of their fingers tapping on the keyboards, no one whispered to each other.
Chief Financial Advisor Zosam stood in the center of the trading floor. He wasn't wearing a suit jacket, his tie was loose, and he was staring intently at the unusually steep Nasdaq index curve on the screen, his hands resting on the control panel.
The air conditioner was on full blast, but a fine layer of cold sweat seeped from Zosam's forehead.
This was not out of fear, but rather an instinctive awe in the face of the abyss, and an almost trembling admiration for the young boss in Tokyo.
He recalled the death order that Kitahara Shin gave over an encrypted transoceanic phone call a few months ago, when the Nasdaq index had just broken through 4,000 points and the whole market was clamoring for it to reach 10,000 points.
"Don't be stingy with the last penny. I want to see all the tech and concept stocks in the Kitahara Group's North American accounts completely liquidated by March."
At the time, several local traders in the North American branch even strongly protested this instruction, arguing that it would cause them to miss out on at least 30% of future profits. But Kitahara Shin offered no explanation, only saying, "Execute it, or take your severance pay and get out."
Now, looking at the shaky trading volume of the market, Zosamu finally understood. Market sentiment had been pushed to its limit; this was not the prosperity of the new economy at all, but the last gasp before a major collapse.
"Mr. Zosam, the last two million shares of Cisco and Qualcomm have been split and are being sold through twelve different covert accounts." The trading manager walked up to him and reported in a low voice, "The stocks of those internet upstarts have also been sold off to retail investors and funds that bought them in the past few days, taking advantage of the positive news."
"There is no room for hesitation." Sasaki straightened up, his eyes turning exceptionally cold. "Press the sell button for all of them."
We're not keeping a single tech stock; we're converting it all into US dollars and locking it up in our vault.
"yes!"
With Sasaki's command, the Kitahara Group, this giant crocodile lurking in the deep sea, silently spat out its last piece of bloody fat, flicked its tail, and completely withdrew from this crazy sea area that was about to become a meat grinder.
The wheels of history often roll down when no one is prepared.
2000年3月10日，纳斯达克指数创下了5048点的历史最高纪录。周末过去，到了3月13
Monday, the death knell tolled precisely on time.
There was no major geopolitical crisis, nor any sudden black swan event. It was simply a few financial media reports questioning the rate at which internet companies were burning through cash, and a few huge sell orders, that were like the last straw that broke the camel's back.
A massive avalanche has begun.
In the first hour of trading, the Nasdaq index suddenly began to plummet. Initially, the brainwashed retail investors and fund managers thought it was just a "technical correction" and rushed in shouting "buy the dip".
But on the second and third days, the plunge turned into an unstoppable panic sell-off. Star tech stocks that were originally worth hundreds of dollars plummeted by 30% and 50% in just a few days! Those ".com" companies that had no profit to support them and relied entirely on venture capital to stay afloat saw their stock prices plummet to the level of worthless paper dollars.
This is fundamentally different from the bursting of Japan's bubble economy in the early 1990s.
The core of Japan's bubble economy lay in the "land myth" and "bank credit." Companies used ever-appreciating land as collateral for bank loans, then invested the loans in the stock market, creating a tangible link between the two. When the Japanese government proactively burst the bubble, raised interest rates, and tightened credit, it triggered a systemic debt crisis across society, a long "lost decade." It was a slow strangulation based on the collapse of tangible collateral.
Meanwhile, the dot-com bubble on Wall Street was a pure "equity game" and "hype." These internet companies had no land or factories to mortgage; their funding relied entirely on venture capital (VC) in the primary market and retail investors in the secondary market. When market confidence collapsed overnight, VC firms immediately tightened their purse strings. This meant that these shell companies, which were burning through millions of dollars every month to maintain servers and Google, had their cash flow snapped instantly, unable to even pay their employees' salaries for the following month!
A stampede effect occurred.
Inside the trading hall, cries of agony filled the air. The phones rang shrilly, all urgent calls from brokerages demanding additional margin.
"Sell it! No matter the price, clear out all of it!" The hedge fund partner who had been mocking the real economy in the banquet hall just a few days ago was now bloodshot, his tie torn to shreds, roaring madly at the trader.
But nobody wanted to take it over.
A large number of once-arrogant financial upstarts experienced a dramatic fall from billionaires to heavily indebted individuals within weeks. Some broke down in tears in front of their computer screens, while others walked out of the trading room with deathly pale faces, silently climbed to the rooftops of Manhattan skyscrapers, and jumped to their deaths.
Wall Street, a scene of bloodshed.
Chiyoda Ward, Tokyo.
The cherry blossoms of early spring have quietly bloomed in the courtyard of Kitahara Manor, and a gentle breeze has caused the petals to fall in abundance.
Kitahara Shin, dressed in comfortable loungewear, sat in front of the floor-to-ceiling window of the tea room, quietly watching the koi fish swimming in the pond outside.
A pot of fine Shizuoka sencha is gently bubbling on a small red clay stove, emitting a tranquil aroma.
The encrypted satellite phone next to me rang.
"President." On the other end of the phone, Sasaki's voice, though trying hard to remain composed, still trembled with the shock of surviving a close call and a resounding victory. "We're completely safe. Wall Street is littered with corpses. The Nasdaq has fallen by nearly a third and is still dropping. All the funds we cashed out at the peak have been liquidated, and the cash flow in our offshore accounts is a full 20% more than we expected six months ago!"
Faced with this enormous fortune—enough to buy a small country—Kitahara Shin's face didn't show much elation. His eyes remained as unfathomable as a deep well.
"Well done, Sasaki." Kitahara Shin picked up his teacup, took a small sip, and said, "Have the traders go on vacation in shifts. As for you and the core business team, get your shotguns ready."
"A shotgun?"
"Wall Street has bled enough." Kitahara Shin put down his teacup, looking out the window towards the other side of the ocean. "Now, it's our turn to go to Hollywood and pick up the pieces."
In fact, this was not a spur-of-the-moment commercial plunder.
More than half a year ago, when Inception was first conceived, Shin Kitahara and Sasaki had already made a far-reaching and secretive plan in their Los Angeles office, studying the Hollywood industry map.
Outsiders only saw Kitahara Shin focused on making movies, but they didn't know that Sasaki's financial intelligence team spent eight months thoroughly dissecting the cash flow of the six major Hollywood studios and hundreds of small and medium-sized related companies.
They discovered a fatal weakness: in the past two or three years, due to the dot-com bubble, a large amount of Silicon Valley tech capital and Wall Street venture capital poured into the entertainment industry. Many Hollywood film companies and special effects studios, in order to expand, became deeply tied to these tech capital firms, some even using ".com" company stock as collateral—
Project financing.
Kitahara Shin and Sasaki, like two patient, hungry wolves, had long been eyeing this area. They compiled a "hunt list" that was dozens of pages long, just waiting for the anticipated avalanche to arrive.
Now, the storm is coming.
The Wall Street avalanche spread to Hollywood studios with alarming speed. Silicon Valley tech giants, struggling to survive, withdrew their investments from the entertainment industry. The financial chains snapped in an instant.
A major Paramount sci-fi production was forced to halt because its investors went bankrupt. Dozens of top visual effects companies in Burbank are facing the prospect of not being able to pay salaries due to unpaid bills from studios. Numerous small and medium-sized independent film companies, struggling with cash flow problems, have filed for bankruptcy liquidation.
Hollywood as a whole is facing an unprecedented liquidity crisis. In this capital winter, those who hold cash are like gods, wielding the power of life and death.
In mid-April, Kitahara Shin secretly flew to Los Angeles.
Inside the top-floor conference room of the Kitahara Group's North American branch, the curtains were drawn tightly shut. The enormous conference table was piled high with lists of high-quality assets that would normally be impossible to acquire even at three times the premium.
Sasaki pushed up his gold-rimmed glasses and handed several documents to Kitahara Shin.
"President, everything is proceeding as we predicted six months ago. In Los Angeles right now, apart from the six giants who can barely stay afloat thanks to their parent companies' financial support, the underlying industrial chain is on the verge of suffocation."
Kitahara Shin flipped through the documents. His primary target wasn't some glamorous celebrity agency, nor those overpriced studios of established directors.
What he wanted to buy were the fundamental industrial assets of Hollywood: special effects rendering technology, physical prop workshops, and the land holding the film projection equipment. These are the unshakeable foundations of an entertainment empire.
Two days later, in a high-end office building in Santa Monica.
This is a top-tier visual effects studio called PhantomFX, which has participated in the production of many visual effects blockbusters such as Titanic, and possesses the most advanced fluid rendering engine and motion capture patents in Hollywood. However, due to the parent company's broken investment chain, the studio has already owed its employees two months' salary and faces the fate of being auctioned off.
Thomas, the founder of Phantom Industries and a tech geek who once worked at Lucasfilm, sat dejectedly at the conference table, his eyes bloodshot.
Sitting opposite him was Kitahara Shin, dressed in a dark bespoke suit with a cold gaze.
"Mr. Thomas, I've reviewed your accounts. Your current debt shortfall is thirty-five million US dollars." Without any pleasantries, Kitahara Shin pushed an acquisition contract directly at him. "The Kitahara Group is willing to take over all your debts and inject fifty million US dollars for subsequent hardware upgrades."
Thomas stared at the contract, gritting his teeth. "Mr. Kitahara," he said, "Phantom Industries' patents are worth far more than this. If it weren't for this damn stock market crash, we'd be on our Series B funding round soon. We need to retain at least 30% of the equity and sign a performance-based agreement."
"You don't seem to understand the situation." Kitahara Shin leaned back in his chair, his voice calm and even, yet it carried an irresistible sense of oppression. "Right now, there are special effects artists everywhere outside who are preparing to jump off buildings because they can't get paid."
Without my cash, your company will be sealed off by the bank tomorrow morning, and your prized patents will be broken up and sold off cheaply to pay off debts.
Kitahara Shin took a pen out of his pocket and placed it on the contract.
"One hundred million US dollars in cash, no performance-based agreement, no installment payments. I want 100% absolute control of Phantom Industries. Your team can stay with the company and continue to be paid, but from today onwards, you will only serve Kitahara Productions."
In this harsh winter when even raising a few million dollars in cash is difficult, the visual and psychological impact of a hundred million dollars being thrown onto the table is devastating.
Thomas stared at the indenture that left no room for negotiation, the struggle in his eyes gradually fading. Faced with this enormous sum of money that could save all his employees' jobs and even allow him to escape unscathed, he finally reached out with trembling hands, picked up the pen, and signed his name.
But this was only the beginning of a massacre.
Over the next two weeks, Zosam led an acquisition team of hundreds of top lawyers and accountants, sweeping through the commercial real estate markets of Los Angeles and New York like a swarm of locusts.
The underlying logic of this bargain-hunting operation for cinema land is exactly the same as that of Kitahara Nobu's bargain-hunting of Minato Ward real estate during the bursting of Japan's bubble economy.
When the stock market crash triggered a sharp drop in commercial real estate valuations, the Kitahara Group didn't even bother negotiating with those cinema operators.
Zosam directly approached banks and trust companies on Wall Street that desperately needed cash to fill their financial holes, and bought up the ground floor commercial real estate and debts leased by large chain multiplex cinemas at extremely low prices.
When the theater chains came to their senses, they were horrified to discover that the creditors and landlords of the theater sites they had leased in prime locations in downtown Los Angeles and Times Square, New York, had all become shell real estate companies under the Kitahara Group.
By taking this drastic measure, Kitahara Shin effectively strangled the physical throat of North American film distribution.
This is different from their solo efforts in Japan back then. The Kitahara Group now possesses an extremely large professional team, a sophisticated tax avoidance structure, and unparalleled cash flow reserves. This efficiency of coordinated operations allows them to act so quickly that their competitors simply cannot react.
Within just one month.
Executives from six major companies, including Warner, Paramount, and Universal, are still holding various emergency meetings in a state of utter panic to deal with the withdrawal of funds from Silicon Valley.
Just as they finally regained their footing and attempted to reintegrate Hollywood's resources, an internal report on the Kitahara Group's recent acquisitions was slammed onto the desks of the six major executives.
The vice president of Paramount looked at the list in the report, and cold sweat instantly soaked his back.
Three of Hollywood's top ten visual effects companies, including Phantom Industries, were fully acquired; ownership of more than 400 chain theaters in prime locations in major North American cities was transferred; and thousands of low-priced film and television IP rights were secretly bought out and packaged.
Inside a private mansion in Beverly Hills, Los Angeles.
Shin Kitahara stood before the enormous floor-to-ceiling window, overlooking the film capital city beneath his feet. Sasaki stood behind him, handing him a list of assets with all legal transactions completed. Kitahara didn't take the list; instead, he raised his glass and downed the whiskey in one gulp. The glass reflected the neon lights of Los Angeles, mirroring the cold, predatory glint in his eyes.