"This is a misunderstanding! A complete misunderstanding!" the Factory Manager waved his hands frantically. "Our machines are running at full capacity, and our workers are pulling overtime. We will absolutely deliver Sega's orders on time and with guaranteed quality!"
"The machines are running, but you've taken all the money meant for raw materials and poured it into property speculation," the Sega representative cut him off, showing no mercy. "Sega does not need a supplier whose capital chain could snap at any moment. Once the Hong Kong property market crashes and the banks call in their loans, what will you use to buy raw materials? How will you deliver the goods?"
The Factory Manager slumped into his chair, his handkerchief fluttering to the floor.
"We advised you to cash out and exit the market," the representative said, standing up and smoothing the hem of his suit jacket. "Since Boss Li believes we are standing in the way of his fortune, we have no choice but to handle this strictly by the book. Starting next month, Sega will downgrade your factory's credit rating. The orders originally allocated to you will be transferred to financially healthy factories in Dongguan."
The representative turned and walked toward the door.
"Wait! I'll sell! I'll sell that apartment in Repulse Bay immediately!" the Factory Manager shouted, springing to his feet.
The representative didn't stop. He opened the door and walked out.
Mong Kok, Hong Kong. The warehouse of a major electronics distributor.
The distributor, Boss Wang, was directing his workers as they moved boxes of Sega game consoles.
A Sega sales representative walked over and handed him a notice of quota reduction.
"Boss Wang, your supply quota for next month has been cut in half."
Boss Wang's eyes widened. "On what grounds? My sales volume last month was in the top three in all of Hong Kong!"
"Your sales are in the top three, but the security deposit you've placed with us was all borrowed against the properties under your name," the representative said, pointing to the terms in the notice. "You've invested all your cash into the stock market. Sega's channel policy is very clear: distributors are strictly forbidden from over-leveraging their operations."
"The stock market is booming every day. What's wrong with making a little extra money?" the boss retorted defiantly.
"Sega doesn't interfere with your investments. But Sega cannot bear the risk of your bankruptcy," the representative replied calmly. "If the stock market crashes, you won't even be able to pay the final balance for your shipments. The quota reduction is a final decision from Headquarters. If you can provide an unsecured bank certificate within one week, your quota can be restored."
The boss crumpled the notice into a ball and threw it on the ground.
Hoshino summarized the situation.
"We've issued an ultimatum to those suppliers and distributors," Hoshino said, picking up his coffee cup. "Those who listened to our advice cashed out and preserved their cash flow. Sega will continue to work with them. Those who refused, thinking we were meddling, threatened to resist..."
"The ones who refused to listen, thinking we were meddling, threatened to resist. So, the Procurement Department directly lowered their credit ratings. All orders and supply sources were shifted to factories with sound finances that hadn't ventured into high-risk investments."
Takuya Nakayama stood up and walked to the floor-to-ceiling window.
"Strike the snake at its seven-inch mark. Cutting off their supply and orders is more effective than ten thousand lectures." Takuya shoved his hands into his trouser pockets. "A manufacturing company should stick to its core business. Sega cannot be tied to companies that lack even basic risk control. Money in the financial markets comes fast and goes faster. Once the tide recedes, it's obvious who's swimming naked."
He turned around to face Hoshino.
"Sega's foundation is in hardware and games. The supply chain absolutely cannot be disrupted. If production capacity is paralyzed, we'll be at a disadvantage in the end-user market. Your foresight in this matter was excellent. It's far more valuable than that forty percent profit you made in the stock market."
Hoshino stood up and bowed his head slightly.
"Only when the rear is secure can the front line fight freely. The supply chain in Hong Kong has been completely reshuffled. The only ones left are high-quality companies with strong risk resistance." Hoshino closed the folder. "No matter how rough the storm outside, our ship is steady."
Takuya Nakayama walked back to the coffee table, picked up the half-full glass of water, and drained it in one gulp.
"Soros is coming in strong this time. The HKMA will definitely use their foreign exchange reserves to fight back. When gods fight, mortals suffer. If these industrial companies can't read the situation, they won't even have bones left to pick clean in the end. Sega helping them out is already more than enough. If they're ungrateful, let them rot."
Less than half a month after Sega had purged the unstable elements from its supply chain, the international financial markets were suddenly thrown into turmoil.
October 20th, Sega Headquarters in Tokyo, Investment Department's exclusive trading room.
Hoshino grabbed a freshly printed bulletin and strode to Takuya Nakayama's swivel chair.
"Managing Director, the flare has been launched." Hoshino slammed the bulletin down on the coffee table.
Takuya Nakayama picked up the bulletin, his eyes sweeping over the bold headline.
New Taiwan Dollar Plummets 6.5% in a Single Day.
"The Central Bank of Taiwan has given up the fight," Hoshino said, pulling out a chair and sitting down. His fingers tapped the table. "Under the pressure of the spreading Southeast Asian crisis, they've actively allowed the New Taiwan Dollar to depreciate. This is exactly the favorable opportunity on the periphery that Soros has been waiting for."
Takuya Nakayama tossed the bulletin back onto the table, picked up the glass of warm water beside him, and took a sip.
"Once the external defenses crumble, Hong Kong will become an isolated island," Takuya Nakayama said, setting down his water glass. "The Wall Street crowd is about to make their move."
Hoshino nodded, grabbing the internal microphone on the console to issue orders: "Everyone, lock onto the Hong Kong markets! Report any fluctuations in the London foreign exchange market, the Hang Seng Index, and index futures immediately!"
Two days later, October 22nd.
In the afternoon, the atmosphere in the trading room suddenly tightened.
A trader shot to his feet, letting his pen clatter to the floor without a glance.
"Director Hoshino! Massive sell-off in the London foreign exchange market! Someone's dumping the Hong Kong Dollar!"
Hoshino rushed to the console, gripping its edge with both hands.
On the screen, the exchange rate curve for the Hong Kong Dollar against the US Dollar was plummeting, repeatedly smashing through the psychological support level of 7.75.
"What's the volume?" Hoshino shouted.
"Preliminary estimate, over three billion US dollars!" The trader's fingers flew across the keyboard. "It's all the hedge funds led by the Quantum Fund smashing the market!"
As the words fell, another trader monitoring the stock market turned around.
"Massive sell-off in the Hang Seng Index spot market! Borrowed blue-chip stocks are being dumped on the buyers. The index can't hold!"
Hoshino turned to look at Takuya Nakayama, who was sitting on the sofa.
"Full-scale assault," Hoshino said, settling back into his chair as he pulled up the futures data. "They're starting to unleash those 100,000 short contracts they've been accumulating in the futures market. Currency, stocks, and futures—they're attacking on all three fronts. Soros is trying to back the Hong Kong Monetary Authority into a corner."
Takuya Nakayama leaned back against the sofa, crossing his legs. "Let's see how the HKMA counters."
On October 23rd, the situation spiraled completely out of control.
The HKMA's counterattack was brutal.
"The HKMA is intervening!" a trader shouted. "They're using the Exchange Fund to absorb all the Hong Kong Dollar sell-offs in the market!"
Hoshino's eyes were glued to the screen.
"Just absorbing the selling isn't enough," Hoshino said, his fingers flying across the keyboard as he pulled up the Hong Kong Interbank Offered Rate (HIBOR) data. "They have to drain the market's liquidity and drastically raise the cost for speculators to borrow Hong Kong Dollars."
The numbers on the screen fluctuated so wildly that the entire trading floor fell silent.
The overnight HIBOR, which usually hovered around 9%, suddenly took off.
20%.
50%.
100%.
Finally, it froze at a staggering 300%.
The one-month HIBOR soared to 40%, and the six-month HIBOR broke past 20%.
The Prime Rate was hiked directly from 8.75% to 9.5%.
Hoshino swallowed hard, staring at the exaggerated figures.
"The HKMA has gone mad," Hoshino said, leaning back in his chair. "Draining liquidity like this is a pyrrhic victory—killing a thousand enemies while losing eight hundred of our own. The speculators can't borrow Hong Kong Dollars to attack the currency anymore, so the exchange rate is temporarily stable. But—"
Hoshino paused, turning to look at the Hang Seng Index chart.
"But high interest rates will crush the stock market," Takuya Nakayama finished his sentence.
On the screen, the Hang Seng Index was in a freefall.
Green candlesticks plunged downward, one after another.
Every second, hundreds of millions in wealth vanished into thin air.
On October 23rd alone, the Hang Seng Index plummeted 1,211.47 points, a staggering drop of 10.4%.
The entire trading floor fell silent.
The crash continued over the next few days.
From October 22nd to October 28th, in just one week, the Hang Seng Index plunged 3,343.2 points.
A 27% drop.
Seven hundred billion Hong Kong Dollars in market value evaporated.
Hoshino took a summary report and walked over to Takuya Nakayama.
"Managing Director, Soros has won a decisive victory." Hoshino spread the report open. "Their attack on the currency was just a feint. Forcing the HKMA to raise interest rates was their true objective. The high rates caused the Hang Seng Index to plummet nearly 40%. The 100,000 short contracts they'd already positioned in the futures market have paid off massively. This is a classic case of losing a battle to win the war."
Takuya Nakayama glanced at the profit estimates on the report.
"Wall Street really knows how to weave a nested trap," he muttered, reaching for the cigarette pack on the desk and lighting one.
A wisp of blue smoke rose.
"Are our offshore accounts in Hong Kong safe?" Takuya asked, exhaling a cloud of smoke.
"Absolutely," Hoshino replied without hesitation. "The funds are all earning interest. We never put a single cent into the market."
The internal phone on the desk suddenly rang. Takuya pressed the speakerphone button.
"Managing Director, this is Li Cheng from the Asia Supply Chain Management Department." The voice on the other end betrayed a mix of relief and lingering fear.
"Go ahead."
"Hong Kong is in total chaos," Li Cheng said, his words coming fast. "The factories we downgraded and shifted orders away from last month—banks showed up this morning to seize all of them. The Hang Seng Index crashed, the property market collapsed right after, and banks are now frantically calling in loans to protect themselves. Those factory managers used their properties as collateral to speculate on stocks and real estate, and now their cash flow has completely dried up. They can't even pay their workers' severance. Boss Li from the Kwun Tong factory stood on his roof for half the night before the police finally talked him down. And Boss Wang, the distributor in Mong Kok? The banks seized and auctioned off all his shops, and he's already fled."
Takuya Nakayama flicked the ash from his cigarette.
"What about our current suppliers?"
"Steady as a rock," Li Cheng's voice rose slightly. "The ones who stayed are the honest companies that heeded our advice, cashed out early, or never touched the financial markets at all. Right now, factories all over Hong Kong are going bankrupt and liquidating, but our Sega contract manufacturers are actually working overtime to rush production. Their capacity hasn't been affected in the slightest."
"Understood. Keep monitoring the situation." Takuya Nakayama hung up.
Hoshino, sitting opposite him, took a sip from his coffee cup.
"It's a good thing we made the decision to cut out those cancerous suppliers last month," Hoshino said, setting the cup down. "Otherwise, it would be our Sega suppliers lining up on the rooftops these past few days."
Takuya Nakayama crushed his cigarette butt into the ashtray.
"The capital market doesn't believe in tears. They chose this path themselves; they have to bear the consequences." Takuya stood up and straightened the hem of his suit jacket. "Soros ate his fill in Hong Kong. The HKMA is severely wounded, but its foundation is still intact, and Beijing hasn't spoken yet. This battle is far from over."
Takuya walked to the door and gripped the handle.
"Forget Hong Kong," Takuya Nakayama said, turning to Hoshino. "A market this volatile is beyond our control. It's not money we were ever meant to make."
"Continue with the original plan," he added. "Keep your eyes glued to South Korea. Their chaebols won't last much longer."
Hoshino shot to his feet. "Understood!"
Night had fallen over Tokyo.
Takuya pushed open the front door and tossed his car keys onto the entryway storage cabinet. After slipping into his house slippers, he noticed the living room lights were off, save for a single floor lamp casting a soft glow.
Faint voices drifted down from the second floor.
Takuya climbed the stairs. The children's bedroom, right next to the master suite, was half-open.
Kazuki sat cross-legged on the rug, a toy monster in his hand, making sound effects as he played. Miki, in her one-piece pajamas, gripped her brother's shirt with her chubby little hand, giggling.
Eri sat on the edge of the bed, a picture book in her lap, watching the two siblings with a helpless smile.
Takuya pushed the door open.
Kazuki quickly hid the toy behind his back and scrambled into bed, trying to look innocent. Miki followed suit, crawling under the covers next to her brother, leaving only her big, round eyes visible.
Eri tucked the children into bed and dimmed the floor lamp.
Takuya Nakayama stroked their heads.
Then, the two of them quietly slipped out of the room.
Downstairs in the living room, Eri, though now a full-time housewife, still kept a keen eye on TV Tokyo's latest news.
Even back in her student days, she had spent so much time at the station that the staff had nicknamed her "the TV Station Princess."
Her passion for the network hadn't faded, even after marriage.
Eri switched on the television and tuned it to TV Tokyo.
The screen showed the evening financial news, featuring a line graph of the plummeting Hang Seng Index in Hong Kong.
Eri walked to the kitchen, brought out a plate of sliced honeydew melon, and set it on the coffee table.
"Sit down, it's about to start," she said, patting the sofa beside her.
Takuya Nakayama loosened his tie, leaned back on the sofa, and speared a piece of melon with a fork.
"What are we watching? Another late-night show?"
Eri nodded and turned up the volume with the remote.
"Father's team is moving fast," Takuya said, swallowing the melon. "It's been less than two months since they got back from Karuizawa, yet the new drama is already finalized? And the translation and dubbing are done too?"
Please Support me by becoming my Patreon member and get 30+ chapters.
[email protected]/Ajal69
change @ with a
Thank You to Those who joined my Patreon