Chapter 127 - Hoarding Land: Will It Lead to His Success?
According to the current market trend, if everything progressed smoothly and no major unexpected factors intervened, international crude oil prices were expected to reach around 27 to 28 dollars per barrel between the end of May and early June. At that point, Lin Haoran could seize the opportunity and decisively sell off his holdings to realize his anticipated profits. After completing this round of oil market operations, he would then carry the accumulated funds and flexibly adjust his investment strategy, shifting to the gold futures market. In Central, inside the offices of Global Shipping Group at Prince's Building, Bao Yugang had just finished a long-distance phone call from Japan. After hanging up, an unmistakable trace of helplessness appeared on his face. As a giant in the shipping industry and the world's largest shipping magnate, Bao Yugang's business empire spanned six continents, with a client network covering the globe, making him a bridge sought after by many for assistance and cooperation. Especially given his deep ties with several oil-exporting countries, numerous buyers desperate to purchase oil but unable to secure priority turned to him, hoping to leverage his connections.
At first, Bao Yugang managed to help a few select clients secure advance oil purchases using his extensive network. However, as similar requests surged to over a dozen within a month, even he found himself overwhelmed. No matter how great one's influence was, it was impossible to satisfy everyone indefinitely. After successfully helping two clients, Bao Yugang had no choice but to make a difficult decision to refuse all subsequent requests. He understood that overextending himself would not only be unsustainable but could also damage his long-term relationships with his partners. Therefore, despite the frustration, he chose to stick to his principles and no longer meddle in these thankless matters.
Previously, Lin Haoran had successfully purchased a large quantity of crude oil from Saudi Aramco by relying on Bao Yugang's network, something Bao Yugang was well aware of. Knowing this, Bao Yugang had initially called Lin Haoran to ask if he intended to sell his crude oil holdings. Upon learning that Lin Haoran planned to make a decision in early June, Bao Yugang respected his decision and did not pursue the matter. He understood that every investor had their own insights and strategies based on careful analysis and judgment. Even with his weight in the business world, Bao Yugang knew it was not his place to interfere with others' investment decisions.
Since December, Bao Yugang had been closely monitoring the movements in the international crude oil market, particularly oil price fluctuations. He had initially expected oil prices to stabilize after a short surge, but contrary to expectations, prices continued to rise steadily and even accelerated. From an initial 12 dollars per barrel, prices had now soared past 25 dollars. Each time Bao Yugang checked the latest oil prices, he couldn't help but sigh and feel a twinge of regret.
Recalling six months ago, when Lin Haoran passionately discussed the oil investment opportunity with him, Bao Yugang had been skeptical. Lin Haoran's proposal, while bold, seemed overly simplistic, ignoring the complexities and high risks inherent in the oil market. Yet the current oil price trend forced Bao Yugang to reassess his judgment. He vividly remembered Lin Haoran's confident words when leaving his house: "Uncle Bao, if you are interested in increasing your returns, this oil investment opportunity should not be missed. Although there are risks, the risk-to-reward ratio is very attractive. Even if the oil crisis doesn't happen, our losses will be limited to some turnover costs; but if a crisis occurs, the profits could multiply. I believe this risk is worth taking." Each time oil prices climbed higher, Lin Haoran's words echoed more strongly in Bao Yugang's mind.
In just half a year, oil prices had doubled! Such highly profitable opportunities were rare, and Bao Yugang regretted missing it. Normally, it would take years to see a project double returns, and here it had happened in mere months. Furthermore, judging by the current oil market trend, the price doubling might not even be the final peak. This reminded Bao Yugang of the oil crisis five or six years ago. From January 1973, when crude oil was 2.95 dollars per barrel, to 1974, when it exceeded 13 dollars per barrel, prices had more than quadrupled. After that, oil prices never returned to pre-1973 levels and stayed above 10 dollars per barrel.
Could this time also see a quadrupling of oil prices? Bao Yugang wasn't sure. But he knew that with the way prices were climbing, at least doubling was guaranteed. Thus, the higher oil prices rose, the more he regretted not investing earlier. Although Bao Yugang's shipping business was vast, its profitability was actually quite low. Intense competition made the shipping industry brutally cutthroat. Bao Yugang believed that a shipping recession was inevitable, prompting him to consider shifting investments from sea to land. His battle for control of Wharf Holdings was his first step toward "abandoning ship for land."
Thus, regarding the oil crisis, he could only feel a lingering regret. At present, he was locked in a prolonged battle against Jardine Matheson for control of Wharf Holdings, with no clear end in sight. Until he secured Wharf Holdings, he couldn't afford to divert funds elsewhere. From that first brief conversation with Lin Haoran, to Lin Haoran's bloodless acquisition of Qingzhou Cement Company, to hoarding oil, to the complete privatization of Qingzhou Cement—every move Lin Haoran made astonished Bao Yugang. Was this really something a young man could accomplish? It was simply unbelievable. Lin Haoran was clearly no ordinary person; his future would surely be extraordinary. Thus, Bao Yugang became increasingly attentive to Lin Haoran's activities.
However, ever since the five British shareholders' complaint forced Lin Haoran to privatize Qingzhou Cement, this young man had kept a much lower profile. His actions grew more mysterious, and news about him became rare. Finally, unable to resist, Bao Yugang activated his intelligence network to investigate Lin Haoran's recent movements. Sitting in his office, Bao Yugang reviewed the report his subordinates compiled. "His next move is hoarding land?" Bao Yugang frowned slightly.
Given his stature in the business world, Bao Yugang had powerful sources. Even if Lin Haoran had been keeping a low profile, information about his actions was still obtainable. The investigation results surprised Bao Yugang. Lin Haoran had indeed bought multiple plots of land one after another. Frequent land purchases clearly indicated he wasn't planning immediate development; otherwise, Wan'an Group's construction team would be overwhelmed. The real purpose was obvious: land hoarding.
Bao Yugang, who naturally had great faith in real estate's long-term prospects, still found Lin Haoran's aggressive strategy risky given his current financial strength. After all, Wan'an Group's land purchases were funded entirely by loans that would eventually need to be repaid. Unless Lin Haoran planned a short-term play—buying land and selling it within six months or two years—long-term holding would be extremely difficult with limited cash flow.
"This young man's past judgment has been exceptional, every move remarkable," Bao Yugang thought. "But will hoarding land this time lead to success?" He was genuinely curious. As a veteran businessman, Bao Yugang could see clearly: Hong Kong's property prices had soared crazily since last year, driven by rampant speculation. The housing bubble was growing, detaching itself more and more from the real purchasing power of Hong Kong citizens. When wage growth couldn't keep up with housing prices, a crash was inevitable, potentially triggering a catastrophic real estate crisis.
Thus, Bao Yugang had a cautious outlook on Hong Kong's property market. Although not a real estate developer himself, he had many close friends in the industry, such as Li Jiacheng. He had even discussed the property market situation with Li Jiacheng. Even Li Jiacheng predicted a property crisis looming in the near future because price growth had become absurdly detached from reality.
For Li Jiacheng and others who already owned massive property holdings, the situation was win-win. If prices soared, their assets appreciated. If prices crashed, they would swoop in to buy distressed properties and then ride the next recovery. That was the advantage of having abundant cash flow.
Having spoken with Li Jiacheng, Bao Yugang was convinced that a real estate slump was inevitable. Thus, he was even more curious: would Lin Haoran's land-hoarding strategy succeed like his previous brilliant moves?
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