Chapter 263: Price Limit
But before that, opening short positions is still the priority.
Wu Sibao went to find Ye Jiqing.
“Sister-in-law, from what Gu Yansheng meant, these Japanese might strike at any time. I’ll go open short positions first thing tomorrow morning. Do you want to come along?
Plummeting from over 400 bucks, ha, we’re gonna get rich big time!
We only put in ten hundred thousand US Dollars, now it’s turned into three hundred thousand. This wave could directly turn into one million. With leverage, it could even reach two million, three million!”
Ye Jiqing was also pondering this matter.
Japanese forced requisition of cotton yarn means cotton yarn futures prices will inevitably plummet. This is a sure-profit deal with no downside, no reason not to join.
But if Gu Yansheng himself isn’t participating, is it appropriate to partner with Wu Sibao?
She eyed Wu Sibao up and down.
Wu Sibao found her dithering annoying. “What’s there to think about? Cotton yarn at over 400 bucks—you think it’ll last forever?
Even without the Japanese making a move, it’s due to fall. Don’t forget, the big market makers have all run off. Only the foreigners don’t know yet. Once they do, they’ll run too.
If you don’t join, I’ll go alone. Just lend me the money, and I’ll calculate normal interest for you.”
If not for borrowing money to expand his stake, Wu Sibao wouldn’t even bother coming.
“I’ll trust you once.” Ye Jiqing took out the money box and handed it over. “But no leverage for me. A little profit is fine.”
“You’re too cautious. What a waste of the market trend.”
Wu Sibao rolled his eyes, then smiled ingratiatingly. “Lend me a bit more. You can do that, right?”
“You take less too. You’re not broke. Why bet so big all at once?”
Ye Jiqing said that, but still took out money and gave it to him. “Ten ten thousand silver dollars. This is funding—it has to be repaid.”
“A once-in-a-thousand-years opportunity—gotta seize it!”
The next day at the exchange.
Wu Sibao took his men to disperse and buy short positions.
Having mixed in the exchange for so long, he was well aware of the rule: never buy big all at once, or you’ll get targeted by the market maker.
The exchange’s market trend was indeed hot right now, way more stockholders than when he first entered.
But watching the stockholders excitedly eyeing the rising cotton yarn market trend, Wu Sibao felt a strange sense of everyone drunk but me sober.
That was the wonder of inside information.
Meanwhile, a few old stockholders he knew greeted him with laughs. “Mr. Wu’s here to lose money again.”
“Watch your damn mouth—cursing me first thing in the morning.”
Seeing Wu Sibao angry, the crowd laughed merrily, showing no fear.
Word was out that Wu Sibao was from agent headquarters. Who made him come every day, the stock market’s guiding light? As old stockholders, they always checked the guiding light’s opinion before buying stocks.
Do the opposite of Sibao, villas by the sea.
The priciest seafront villas on Shanghai Bund were in that stretch by the Bund.
Why not use it if it’s there?
They’d also figured out Wu Sibao was from agent headquarters. As long as it wasn’t too much, this was the concession—no trouble from him. So they could tease a bit.
“Mr. Wu, you think cotton yarn rises or falls today?”
“Why tell you?”
“Coffee on me.”
“I see it falling.”
“Yo, bosses—today’s a sure thing.”
“Hahahaha.”
Wu Sibao was used to it by now. He laughed, “I bought one hand fall, and one hand rise. Go guess.”
“Bad news—sideways today. Everyone can clock out.”
“Hahahaha.”
Meanwhile, upstairs in the dedicated private room.
Sato Kenji’s assistant came to report what he’d heard below.
He joked, “President, we checked. Looks like our luck’s bad today—the one buying short positions is that jinx. And he bought a lot.”
Wu Sibao thought his dispersed buying wouldn’t be noticed, but at this stage, anyone suddenly opening big short positions en masse—besides us Japanese, there weren’t many.
Especially all at once first thing in the morning—hard not to notice.
Sato Kenji frowned upon hearing it. “Why’s he buying so many short positions right now? Did our info leak?”
Sato didn’t believe in jinxes. Plenty of daily losers in stock trading—Wu Sibao was just one of the richer ones.
If he had less money, he’d be out after two losses. No way he’d draw long-term attention like Wu Sibao.
Were they not jinxed?
Pure stupidity.
“President, I don’t think so.” The assistant laughed. “This guy’s the famous guiding light. No one knows what he’s thinking. Look—everyone’s buying rise, so he should buy fall. If he bought rise, that’d be unreasonable, right?
Besides, our internal decision—only non-Japanese don’t know. Limited to each company’s president or trader. No chance of leaks.
I think it’s just luck.”
Sato thought it over. Wu Sibao had no way to get their internal info—probably just luck.
At that, he sneered too. “Didn’t expect this guy’s luck to turn. Let him win this one.”
Reports from each house: spot cotton yarn mostly cleared out. Now all of China’s cotton yarn businessmen were in Shanghai. Once contracts signed and money paid, it was sold for them.
Whether it could be hauled away? Not their problem.
Better if it couldn’t—easier to reclaim later.
“Contact each house’s broker. Morning as usual. Twenty minutes before close, dump big—open massive shorts. Prepare for battle!”
They would clearly signal their entry—from today, declare Japanese capital entering the field!
“Hai.”
Downstairs.
The exchange teemed with people.
Morning cotton yarn related industries still hot. Concession funds took such a big position—naturally hyping to keep the cotton yarn market trend going.
Newspapers’ propaganda offensive, expounding cotton yarn’s importance to all sides today from multiple angles.
Concession’s Chinese experts, British experts, US experts, German experts—all agreed: today’s cotton yarn isn’t just for clothing and warmth. Elevate its status to military supplies strategic materials.
Cotton products’ irreplaceable role in cold resistance. Armies need cotton yarn not just for warmth, but as indispensable raw material in military industry production—core component in bullet and cannonball propellant.
Multi-layer cotton quilts can make simple armor to block bullets and shrapnel. With war at this stage and both sides valuing manpower, this greatly boosts soldier survival rates.
For victory, both sides will use any means. Cotton yarn at over 400 bucks—ordinary folk can’t consume much on income—but armies have money.
More surviving soldiers means more daily cotton yarn demand, driving further consumption.
Cotton yarn can also make bandages—battlefield consumption huge, of course.
Both sides’ shelling burned down many cotton yarn warehouses, so cotton yarn price increase inevitable.
Experts’ words rang true.
From scientific logic, explaining reasons for cotton yarn price increase.
Then arranged stockholders in the crowd passionately boasted—reasons and profits.
Just talk about how much they’ve made lately, how fast—the crowd gathers, hailing him stock god. Nothing more tantalizing than making money.
Of course, most crucial: the oscillating uptrend in cotton yarn futures prices.
Price rise gave market huge confidence, drawing steady inflow of outside watching funds.
Cotton yarn price stably above 450 bucks—looks like breaking 460 today.
Easy money lying down—stockholders already planning evening fun.
As for the slight dip in cotton yarn futures twenty minutes before close—price surged to 460, then smashed to 448.
Absolute wash trading!
Not the first time—main force intimidating again. Too mean.
Upstairs, in several concession funds’ private rooms, brokers spotted something off.
Their plan today: pull price to 460 and up. But now, clearly big funds borrowing spot goods to sell—short selling.
They conferred, sensed trouble, immediately phoned their backers.
Next door, Sato at close saw the price and smiled. The real show was starting.
Those who ran today had the last escape chance.
Back at Mitsui Company, phoned Fu Xiao’an to announce formation of cotton yarn control committee for price cap trading on cotton yarn.
“Hold an emergency press conference right now—announce this. I mean today. Must be done today. I want to see it in papers tomorrow.”
Fu Xiao’an had long awaited this day, but refused this demand.
Too damaging to credibility.
He orchestrated the cotton yarn price increase—sold to businessmen at hundreds. Now cap at 70? What about his reputation?
Anyway, he didn’t believe Japanese could hold out. Announce when needed—why be the bad guy.
“Mr. Sato, unless it’s an order from Greater East Asia Ministry, this old man is powerless.”
One businessman couldn’t command him—Fu Xiao’an wasn’t that soft.
Sato hadn’t expected Fu Xiao’an’s lack of cooperation. Notifying Greater East Asia Ministry temporarily too troublesome—after all, it was cabinet’s.
Procedures too slow.
Sato chose to hold the press conference himself.
At Mitsui Company, Sato and several Mitsubishi Kawasaki presidents jointly announced to reporters.
“SH city’s recent cotton yarn price abnormal fluctuation. City government and consulate recently received many citizens’ complaints—cotton yarn price plummet affecting SH citizens’ daily needs.
Our Mitsui Company, to stabilize the market, for citizens’ living environment, specially decides: from today, form cotton yarn control committee, cap cotton yarn prices. Standard unit price upper limit uniformly restricted to 70 bucks.
Above this price—harsh penalties!”
“70 bucks?”
Price out, reporters in uproar. Recent cotton yarn market trend boom—many got rich. Money-making speed made non-trading reporters envious.
They knew the over-400 price.
But now, one announcement—capped at 70?
Sassoon House, top floor.
Concession capital reps gathered here.
Japanese cotton yarn price cap news already reached their ears.
Ding-a-ling, ding-a-ling.
Sha Shun picked up the phone, listened, soon hung up and told the others: “Verified. Today’s main sellers were brokers from several Japanese chambers. They opened the most short positions too.”
Public Works Bureau’s British Director Kaiseke couldn’t hold back—smashed his red wine glass on the floor, shattering it.
He raged: “So Fu Xiao’an plotted against us from the start?
From 450 down to 70.
Sha Shun! You introduced him—you take responsibility!”
“Calm down.”
Kadoorie Family’s Eli Kadoorie said gravely: “He wanted revenge. Our own greed made us believe his lies. You could’ve stayed out, but since you joined, don’t blame just Sha Shun.”
“You bought little, so you don’t care. I bought 1500 ten thousand! Fifteen million US Dollars!” Kaiseke glared furiously.
Talk of money soured all faces. They tallied: took one hundred eighty million worth from Fu Xiao’an.
Plus chips they’d bought along the way—total likely over two hundred fifty million.
If Japanese capped like this, all hurt bad. No one immune to that pain.
“Sha Shun, what say you? We can’t eat this loss. Can’t let Fu Xiao’an off.”
“Right! Must sanction Fu Xiao’an!”
At that moment, Sha Shun—gazing out the window, lost in thought—turned. “Stock market’s about strength. Fu Xiao’an fooled us, trapped us—that’s his skill. No sanctioning. Loser pays up.
We’ll revenge for sure—but not on Fu Xiao’an. On Japan.
I’m pondering: the exchange is concession’s, yet it always feels under Japanese orders. Not good.
Take cotton yarn—we’ve lost two years running.
Fair competition on strength, loser pays. But Japanese using admin orders to force us—that can’t continue.
Global war chaos now—Shanghai’s stock market actually a value depression, great investment spot.
If we don’t seize initiative, Japanese capital will fully control concession economy. Outside money comes—we get none.
So, time to drive Japanese out of the concession.”
“You have a way?” Eli Kadoorie eyed inquiringly.
Sha Shun nodded. “Of course. But needs our full cooperation.”
Kaiseke’s face twitched with hate. “As long as it teaches them! Any cooperation’s fine!”
“Good. You go back first. I need to see two people. Contact after.”
“Who else? Just call them here.”
“Zhang Xiaolin, Gu Yansheng.”
Half hour later, Sassoon House.
Gu Yansheng walked in. He’d never shown face on cotton yarn, not a stock trading fan—naturally clueless.
“What do you want?”
Sha Shun pulled out a money box, smiled and pushed it over. “Ten ten thousand US Dollars. Help me out.”
“What favor’s worth that much?” Gu Yansheng laughed curiously.
Sha Shun smiled faintly: “Heard Japanese issued cotton yarn price cap. I thought cotton yarn pricey this year—didn’t know where to procure. But now capped at 70—that’s a bargain.
So I want a batch of cotton yarn. Many cotton yarn factories in your West Shanghai. Can you step in, contact their bosses, have them sell to me? Anyway capped at 70—sell to anyone. Might as well me, right?”
Sounded normal. Hard to guess Sha Shun’s game.
Gu Yansheng thought briefly, smiled: “I can help. But convincing them needs incentives. Price drops from over 400 to 70—many can’t accept. They might wait. What if Japanese policy flips, back to 400? I’d be the bad guy.”
“Your face is worth 90 to them. But only today.”
“My face only 20 bucks? Make it 100.”
“Deal.” Sha Shun nodded readily. “Your price. Contact the bosses—we sign contracts now.”
“This urgent?” Gu Yansheng teased. “You got inside line with Japanese—price rebounds in days?”
Sha Shun shrugged with a smile: “Japanese stuff—possible. It’s a gamble. Win, I profit. Lose, I lose 30 per unit. Ten thousand units—three hundred thousand. Not small.”
Gu Yansheng too lazy to guess Sha Shun’s play. More money? Fine by him.
Phoned Lu Bowen, have each factory’s owners come sign contracts.
Sha Shun seemed urgent, fearing they’d back out—not just demanding their scant inventory overnight, but prebooking next two months’.
And set tenfold penalty for breach.
Leaving Sassoon House.
Lu Bowen was baffled. “What’s Sha Shun up to?”
Gu Yansheng chuckled lightly. “Dunno. Doesn’t stop you earning. Next two months’ output all 100% booked upfront—you won’t lose.”
Indeed no loss—Lu Bowen could die laughing. All these factories’ output money in advance—too comfortable.
“Have him haul the goods. We ignore the rest.”
“Got it.”
Later, Zhang Xiaolin’s men drove trucks overnight, hauled all goods away.
Blink—next day arrived.
“Extra! Extra! Japanese announce cotton yarn control committee, price cap on cotton yarn! Stock market plummet imminent!”
“Great positive news! From today, cotton yarn factory price capped at 70 bucks! New Year’s clothes cheaper!
