Rebirth of Hong Kong 1981

   Chapter 586 Rich and Confident

  In the United States, the acquirer must fulfill the disclosure obligation when it acquires 5% or more of the equity of a listed company.

   It is necessary to file with the exchange and the target company within ten days. After that, every time you sell or buy 1% of the shares, you need to file with the above-mentioned institutions in a timely manner.

   In order to facilitate the operation, the transaction is not so troublesome, and the dispersion of shares is necessary.

  Although to a certain extent, some shareholders' rights and interests have been lost, this is not an unacceptable thing for Yang Chen. Those companies that he likes have no intention of affecting anything.

   He is purely for making money, as long as he can make money, he doesn’t care about any rights or interests.

   This time, there are two main reasons why Yang Chen came to the United States so eagerly to acquire the stocks of these companies.

  The first one is that he has money now.

  No money, no confidence.

   Rich and confident.

   After the GB game console was launched, he had a lot of dollars in his hand. If he didn't spend it, he would feel unhappy in his heart.

  Of course, the main reason is that cash is easy to depreciate in hand. Every extra minute you hold in your hand is a loss of thousands of dollars.

  Why do they say that the rich have many troubles, every day they know how busy they are and how busy they are.

   There was no such pain before, but now that Yang Chen has become one of them, that is really very touching.

   Seeing that the money in my hand is depreciating again every minute, the worry in my heart is not to mention.

  The poor work hard to earn money to support their families.

  Rich people work hard to keep their money from depreciating.

   In addition to this, the second reason is that not long ago, the US Securities and Exchange Commission had a lot of easing on the stock repurchase behavior of listed companies.

  The stock repurchase of listed companies in the United States appeared as early as the 1950s.

   However, at that time, due to the strict supervision of the CSRC, for a long period of time, listed companies faced more legal risks. Under normal circumstances, the shares issued were basically not repurchased, and the scale has been relatively limited.

  Before 1982, listed companies that repurchased their own shares were subject to two very serious legal responsibilities, insider trading and market manipulation.

If a listed company has material inside information, if it buys its own company's stock, it may constitute a crime of insider trading. The company's stock repurchase in the open market is often completed in a series of transactions, which will result in a negative impact. Affect the stock market price changes, and thus fall into the risk of market manipulation.

   Therefore, before 1982, few listed companies would repurchase their own shares, because once a repurchase plan was initiated, they would definitely bear legal responsibility, and the intermediate risk was relatively large, and if they were not careful, they might be punished by the law.

   Therefore, many listed companies, except in the face of hostile takeovers, generally do not dare to play this left-handed to right-handed capital game.

   It’s just that this situation has undergone a huge change after 80 years.

  The United States is one of the two superpowers after World War II. Economic changes directly affect most countries in the world. Its every move is particularly noticeable.

  In the second half of this year, that is, in 1981, news was already revealed.

  Although this news was only mentioned briefly in the American news media, and it was not widely reported, but at that time, Yang Chen jumped his feet instantly after seeing this news.

  In the later generations, the US economic growth is as slow as shit, but the market value and stock price of many listed companies are rising.

   What is this for?

   is not caused by listed companies repurchasing their own shares.

  Especially for technology companies. Today, billions of dollars in repurchase and tens of billions of dollars in repurchase tomorrow. Whether it is true or not, after every news comes out, the stock price will go up.

  Especially for those listed companies with good profits, they like to buy back the shares of their own companies almost when they have nothing to do.

   New shares were not issued, and they were repurchased at every turn, resulting in a serious drop in the number of outstanding shares in the market and a high stock price.

  If the stock price of a company is high to a certain extent, then ordinary people should not expect to drink soup from it.

After a listed company repurchases its own company's stock, all that is left for everyone is soup, soup, and water, and the soup, soup and water left is still mixed with venom, and if you drink it, you risk being cut by leeks .

  Although the US Securities Regulatory Commission has set a series of rules after relaxing the repurchase of shares by listed companies, such as:

  The trading conditions include: the trading method, the daily repurchase is only implemented through one broker.

  Trading hours: that is, it does not constitute an opening transaction and is not implemented within a specific time period before the market is closed.

   Trading volume: The daily repurchase volume shall not exceed 25% of the average daily trading volume of stocks in the previous month.

  Transaction price: The repurchase price shall not be higher than the highest independent transaction quotation before the repurchase or the price of the last independent transaction.

  …

   The SEC revised its rules to open up a legal channel for listed companies to repurchase their own shares.

  Compared to the previous case, which may be charged with insider trading and market manipulation, the new rules are not worth mentioning at all in the eyes of listed companies.

   It is undeniable that the repurchase of their own shares by listed companies has greatly improved the returns of investors and also played a role in stabilizing the market.

   However, in this way, whenever the US entity investors have no good investment opportunities after the financial crisis, most of them will reinvest the money earned by the company into their own companies.

After the financial crisis, under the general environment, the stock prices of some high-quality companies will inevitably be affected by the market, and the stock prices will be lower than the actual value. The company's repurchase of its own shares can not only effectively promote the recovery of stock prices, but also attract global capital inflows. bring the economy back to life.

  The above is the good side, but there is also the bad side, and it is more serious.

  After a listed company has a legal way to repurchase its own stock, in order to increase the company's market value and increase its own value, shareholders will inevitably continue to absorb the stocks of their own company that flowed into the market in the early stage.

   In this way, as the number of stocks in the market becomes less and less, the market value of many companies will skyrocket, and over time, the market value of the company will rise to a value that is much higher than the actual value of the company.

  When the general environment is good, naturally everyone makes money and is happy. Once the general environment is bad, the market value of listed companies will fall wildly.

   Take a look at the companies that have fallen from the peak market value of tens of billions to hundreds of billions in later generations. Why did their market value fly to the sky one second, but the next second they fell into Chinese cabbage that no one cares about.

   One of the reasons is here.

  ——

   Thanks for the reward from the dumb scholar, thank you for your support, and a toast.

   (end of this chapter)