The expeditionary force began to dominate Southeast Asia by recruiting defeated soldiers

Chapter 617 Stock Market and Regulation

Gu Gengyu took a deep breath and waved his hands quickly: "Commander-in-Chief, this is really... Ten million knives, this..."

"Hey, have confidence." Zhang Chi interrupted him and felt happy.

I think you don't understand what monopoly is.

"I've given you so much support. I've provided you with land, policies, and even helped you import the best cattle and pig breeds. My goal is to build you into the largest livestock farming giant in Southeast Asia, and even in Asia. Ten million dollars is just a small goal."

He went on to explain:

"In the stock market, there's an important metric for measuring a company's value called the price-to-earnings ratio, or PE for short. It's your company's market value divided by one year's net profit."

"For a leading enterprise like you, with my support, monopoly potential, and in a period of rapid development, the market giving you a 20 times price-to-earnings ratio is not excessive at all."

Zhang Chi stretched out his fingers and gestured:

"What does 20 times PE mean? It means if you earn $10 million a year, your company is worth $200 million!"

"Then, you can take out, say, 30% of the shares and put them on this exchange for a public offering. That would raise $60 million in real money."

"You don't need to repay the principal or interest with this money. You can use it immediately to build a new farm, buy more livestock, expand production, and capture a larger market."

"By next year, your profit might reach $20 million. By then, your company's market value might reach $400 million. The remaining 70% of your shares will also increase in value, becoming worth $280 million."

"Tell me, isn't this much faster and more effective than struggling to save money for expansion, or begging a bank for a loan?"

Zhang Chi's explanation, which combined the common logic of capital operation in later generations, left Gu Gengyu stunned.

Although he was a big businessman, he was mainly engaged in international trade and industry. This was the first time he had heard so thoroughly about this game of financial leverage and capital appreciation.

If you think about it carefully, this is simply a magical method of turning stone into gold.

Using the money you might earn in the future as credit, you can get a huge amount of cash in advance, and then quickly snowball...

Gu Gengyu's eyes lit up instantly, and his breathing became a little rapid:

"Excellent. Commander-in-Chief, your words are truly... truly enlightening! I used to only care about raising cattle and pigs, truly being a novice in the world. The stock market is truly a treasure trove, a fast track."

He seemed to have seen that his livestock company, with the help of capital, would rapidly expand into a huge trust, monopolizing the supply of meat, eggs and milk in Southeast Asia.

"But..." Gu Gengyu was an experienced man after all, and despite his excitement, he didn't get carried away. "The stock price fluctuates. If it falls..."

"So it's financing." Zhang Chi laughed, "The stock price fell, and it affected those who bought your stock later. The $60 million you initially raised was actually sitting in the company's account.

As long as the company's business is solid and profits continue to grow, the stock price will inevitably rise in the long run. All you need to do is use the funds you raise wisely, develop the business well, and increase profits. This is the fundamental thing."

"As for the supervision issue, don't worry." Zhang Chi pointed at Chen Zhenchuan who was talking with Tan Kah Kee and others not far away.

Zhang Chi and Chen Zhenchuan have perfected the separation of central bank operations. The newly established Nanyang Central Bank is only responsible for issuing banknotes and monetary policy, and is not responsible for actual banking operations.

"Governor Chen has taken the lead in establishing a dedicated securities regulatory committee under the central bank. This committee will formulate strict rules to combat insider trading and market manipulation, ensuring that the market operates fairly, openly, and impartially."

"When the time is right, we will establish an independent securities regulatory body. For now, we can only ask President Chen, a talented person, to work harder and do more."

This is Zhang Chi's plan. When an outstanding talent emerges in this process, he will promote him, separate the regulatory business, and establish a new institution to prevent Chen Zhenchuan from having too much power.

Chen Zhenchuan seemed to sense the discussion here. He turned around, nodded and smiled at Zhang Chi and Gu Gengyu, his eyes full of confidence and responsibility.

He has recently been indoctrinated with a lot of modern financial regulatory concepts by Zhang Chi, and he is full of energy.

Gu Gengyu was completely relieved and rubbed his hands excitedly:

"Great! With your guidance, Commander-in-Chief, and President Chen's oversight, I feel reassured. I'll have my accountant and lawyers hurry up with the preparations when I get back, striving to meet the listing standards as quickly as possible and come to the exchange to ring the bell."

Zhang Chi nodded with satisfaction.

What he didn't say was that what he wanted was to allow leading enterprises like Gu Gengyu to take the lead first and become bigger and stronger.

He then used his position as the president to split up and tax these companies, and reinvested the proceeds into national construction and improvement of people's livelihood.

Standing on the upper floor of the exchange, watching the traders wearing numbered vests running around, Zhang Chi held the railing as if he had already seen how the Xingzhou Exchange, a huge capital pump, would continuously draw up private and overseas funds.

Then it was precisely irrigated into the most promising industries in Southeast Asia, giving birth to giant enterprises and accelerating the industrialization process of the entire country.

During the war, others saw danger, but he saw huge opportunities.

A regime capable of concentrating its resources on major tasks, a relatively secure rear area, a market in urgent need of reconstruction, and a financial market capable of effectively allocating capital...

This is simply a golden development formula tailor-made for Nanyang.

And all this will begin with the sound of the gong today.

Inside the exchange, cheers reached a climax again.

Zhang Chi looked at the boiling crowd and the constantly changing numbers, and a smile appeared on the corner of his mouth.

The wave of capital has arrived, and he will be the most important wave rider.

-----

Li Shuisheng was wearing a washed-out but still neat student uniform, carrying a worn cloth schoolbag, and walking quickly with his head down in the shantytown in the north of the city.

Sewage is everywhere, and the air is filled with the peculiar turbid smell of low-quality coal smoke, rotten food, and crowds of people. It seems like two different worlds compared to the newly built, bright and beautiful streets in the south of the city.

Shuisheng is fourteen years old this year. His thin face still shows the childishness of a boy, but his eyes are unusually bright, revealing a calmness and vigilance that is inconsistent with his age.

He is a native Chinese in Yangon.

Three years ago, the Japanese occupied this place.

He would never forget that evening when the Japanese soldiers armed with guns and those fawning Chinese scum wearing armbands (he later learned they were called "traitors") rushed into the neighborhood where his home was located and arrested people from house to house on the charge of "collaborating with the enemy."

His father, an honest carpenter, was dragged out of the house just because he hid a few bags of rice.

The mother rushed forward crying, but was knocked to the ground by a traitor with the butt of a gun.

My father struggled and cursed angrily, only to be kicked by a rifle butt and leather boots in return, and then he was dragged away like a dead dog.

The next day, his body was found in a mass grave not far away, with not a single piece of healthy flesh left on it.

My mother was seriously injured and was shocked and terrified. She passed away within half a month.