What was the real era of "Flowers"? It was not Mr. Bao who made a fortune by speculating in the "electric vacuum", but Yang Million
In the early 1990s, Wanguo Securities Co., Ltd. at the intersection of Xizang Middle Road and Guangdong Road in the center of Shanghai was one of the gathering points for stockholders. Source: Visual China.
Author | Wen Shijun
Edit | Chen Fuye
Produced by | Prism Tencent Xiaoman Studio
With its rich tones, dancing light and shadow, and jumping and switching shots, Wong Kar-wai uses his signature visual language to bring us back to the 90s, when adventure and opportunity were intertwined, and back to the wild Shanghai Tang of China's financial market.
"Shanghai in 1992 was as beautiful as neon and a sea of flowers. "Southern talks, stocks, the Shanghai Composite Index rushed from 100 points to nearly 1,000 points in a year.
"Everyone is equal in the face of opportunities, and if you seize the opportunity, you have the potential to change your life. Some people ride the wind, and some people go to zero in half a day. "Looking back, most people are in the middle of it, and they don't know it. But Hu Ge's Shanghai young man Ah Bao became a trendsetter in that era.
Just as the "noble" uncle said to Bao, "I am here to calculate the affairs on the Huangpu River for you, but your heart is full of Suzhou Creek", Wong Kar-wai unfolded the picture of A Bao and the three women on a snowy night, and also described the ups and downs of the sea in Shanghai more than 30 years ago for the audience.
At the beginning of the play, the young Ah Bao was ordered by his uncle to borrow money (now it is leverage) to buy the "electric vacuum". The stock price of "Electric Vacuum" fell first and then rose, rising five times, which became the first pot of gold for "Bao" to become "Bao Zong".
"Electric vacuum" does have its own strands, and its prototype is one of the "old eight strands" of vacuum electronics.
"Old Eight Shares" appear many times in "Flowers", referring to the first eight stocks listed and traded on the Shanghai Stock Exchange, namely Feilo Audio, Yanzhong Industrial, Aixiang Electronics, Vacuum Electronics, Shenhua Electrician, Feilo Shares, Yuyuan Shopping Mall, and Zhejiang Phoenix.
The origin of China's stock market
Before the liberation, Shanghai was an important stock exchange market in the Far East, and there were a number of "old stockholders" like "Granduncle" who knew about the securities market. After the reform and opening up, Shanghai naturally became the first fertile ground for the stock market to explore.
In the early 1980s, with the expansion of the autonomy of state-owned enterprises and the pressure of "succession" and employment brought about by the return of educated youths to the city, some state-owned enterprises in Shanghai began to form a collective "tertiary industry" in order to increase their income and absorb and arrange rich labor.
As early as September 1980, the 17th Shanghai Cotton Factory took the lead in issuing "stock coupons" to raise 300,000 yuan. However, most of these "stock bonds" are actually a kind of internally issued bonds, which are not issued to the public and cannot be circulated. Not only may there be difficulties in the issuance of employees' reluctance to subscribe, but the effect also restricts its ability to raise funds.
Xu Jiashu, former deputy director of the Shanghai Municipal Commission for the Reform of the Structural Reform, once wrote an article recalling that the emergence of a large number of "stock coupons" "paved the way for the reform of the shareholding system and created an atmosphere."
Another context is the macroeconomic policy of 1984-1985. After the reform and opening up in 1978, while the economy developed rapidly, there was also a relatively serious round of inflation. At the decision-making level, measures for "economic adjustment" were proposed. Specifically, one of the core measures is to control credit and fixed asset investment. At the implementation level, it is not easy for many collective enterprises to obtain loans.
It is not difficult to understand why in July 1984, the Shanghai branch of the People's Bank of China issued the "Interim Administrative Measures on the Issuance of Shares". It is precisely this measure that stipulates for the first time that collective enterprises may issue shares to the public.
At that time, Qin Qibin, then the director of Shanghai Feilo Electroacoustic Factory, was worried about funds.
Qin Qibin was born in 1940, was admitted to Fudan University in 1958, majoring in electronics, and was assigned to the technical department of Shanghai Radio No. 9 Factory after graduation. In the early 80s, under the wave of younger and more professional cadres, Qin Qibin was promoted to deputy director of the office of the Component Industry Company of Shanghai Instrument and Telecommunications Industry Bureau.
But soon, Qin Qibin, who was in his early 40s, felt that "his personality was not suitable for working in an agency, and proposed to do some practical work at the grassroots level." In 1984, Qin Qibin became the director of Shanghai Feilo Electroacoustic General Factory.
At that time, "music cafés" were very popular in Shanghai, and audio became a hot commodity in the market. Qin Qibin then proposed that the speakers produced by the factory can be made into audio in addition to supporting the TV. To this end, Qin Qibin set up a "three-industry" audio company, aiming at this market. But where will the funds come from to build the factory?
Qin Qibin happened to step on the beat of history. In November 1984, a few months after the issuance of the Interim Administrative Measures for the Issuance of Shares, Shanghai Feilo Audio Co., Ltd. was established. Feilo Audio issued 10,000 shares, with a par value of 50 yuan per share, raising a total of 500,000 yuan - 35% of these 10,000 shares were subscribed by legal persons, and 65% were publicly issued to the public.
This is the first joint-stock company after Shanghai's reform and opening up, and it is also the origin of China's stock market.
At that time, a stock was a "ticket" that existed in the form of a physical entity. The stock of Feilo Audio refers to the stock style of Shanghai Nanyang Cigarette Factory before the liberation, and is printed by Shanghai Banknote Printing Factory according to the standard of printing RMB. As the "first share" after the reform and opening up, the seal of Chairman Qin Qibin on the ticket also made him a participant and witness of history. The form is printed on the back, and the stock transfer is handwritten and stamped on it for record.
In November 1986, John Joseph Phelan Jr., then chairman of the New York Stock Exchange, presented him with a New York Stock Exchange Golden Key badge to the central leaders who met him.
Chen Muhua, then governor of the People's Bank of China, who accompanied the central leaders to the meeting, gave back to Fan Erlin a stock of Shanghai Feile Audio.
The smallest exchange in the world
For the stock market to develop, there must be liquidity brought by the secondary market.
Soon after the issuance of Feilo Audio's shares, there were holders who began to transfer. However, in the first few years of China's "stock market", sellers had to find buyers on their own, and then go to the Jing'an branch of the Industrial and Commercial Bank of China Shanghai Trust and Investment Company to handle the transfer procedures.
And the stock price cannot be "speculated" at will. At that time, it was stipulated that the stock transaction price was the par amount plus the current savings interest. At that time, the stock was more of a "shareholding + dividend" certificate.
In fact, the "Jing'an Branch of the Industrial and Commercial Bank of China Shanghai Trust and Investment Company" has a special historical position in the Chinese stock market: in September 1986, in a barber shop of more than 10 square meters at No. 1806 Nanjing West Road near Jing'an Temple, the company established the Jing'an Securities Trading Department, which was the first stock trading counter in China.
The first to trade were only two stocks: Feilo Audio, and another street collective enterprise that was publicly offered in January 1985, Yanzhong Industrial Co., Ltd. - "Yanzhong" refers to the street of Yan'an Middle Road. The way of trading is also very "traditional", with quotes written on a blackboard.
But this means the beginning of a real secondary market: shareholders can entrust the counter to list here, purchase and sell, without having to find sellers and buyers themselves.
Li Jizhao, a columnist for Securities Times, was one of the planners who participated in the joint-stock stock market in the 80s. He has interviewed Huang Guixian, the former manager of the business department of Jing'an Securities, and other parties many times. According to their recollections:
On the opening day, the door was originally scheduled to open at 8:30, but at 7 a.m., the inside and outside of the sales department were crowded with shareholders and people watching the excitement, and the big tree at the entrance was full of people watching the excitement. After the official opening, Feile Audio opened at 55.6 yuan and Yanzhong Industrial at 54 yuan. The first buyer, a disabled person in a wheelchair, bought 18 shares of Feile audio for 1,000 yuan. After the close of trading at 4:30 p.m., a total of 1,540 shares were traded, with a turnover of 85,280 yuan.
Interestingly, John Verlin, then chairman of the New York Stock Exchange, who received the shares, also came to the "smallest exchange in the world" in person and transferred his shares of Feile Audio.
Chen Muhua's gift of Feilo Audio shares was officially transferred to Fan Erlin, chairman of the New York Stock Exchange, who also became the first foreigner to own Chinese stocks after the reform and opening up. Source: Wen Wei Po.
The Legal Daily once recorded this scene: Hu Ruiquan, then deputy manager of the Jing'an Securities Business Department, was very embarrassed and said to Fan Erlin: "I'm sorry, we just started here, it's too small!" Fan Erlin's answer is also interesting: "It's much better here than when we started, after all, there is a house, and the New York Stock Exchange was first traded under a plane tree." ”
Due to the small size of the site, the sales department was soon relocated to No. 101 Xikang Road, which flashed on the note of the Peace Hotel in "Flowers", which is where Po started.
In less than a year, the number of Shanghai stock trading counters increased to nine. By November 1987, the stock trading price was also liberalized, and the par amount and bank interest were no longer looked at, and the stock price went with the market - this was the real beginning of "stock speculation". In fact, in the following years, the "Jing'an Index" compiled by the Jing'an Securities Trading Department also became one of the most important indicators reflecting the decline of China's stock market at that time.
On December 19, 1990, the Shanghai Stock Exchange was officially opened. Eight stocks, including Feilo Audio and Yanzhong Industrial, no longer need to be over-the-counter and are officially listed on the exchange, which is the "old eight shares" of the Shanghai Stock Exchange.
Today, Feilo Audio (600651. SH) as the first stock after the reform and opening up, is still active in the trading market, its major shareholder has been restructured several times, and is now Shanghai INESA Electronics (Group) Co., Ltd. Although its main business is no longer audio, it has not departed from its old business - automotive electronics, module packaging and chip testing, etc.
As of the third quarter of 2023, Feilo Audio's revenue is 1.39 billion yuan, and the net profit attributable to the parent company is 15 million yuan, making it a small and medium-cap stock with a total market value of less than 10 billion yuan. However, compared with the delisted Ai Ling Electronics and Zhejiang Phoenix in the "Old Eight Shares", as well as Feilo Shares, which has become "ST Zhong'an", this situation is not bad.
The issuance time and status of the "old eight shares" of the Shanghai Stock Exchange, the current market value is as of January 22, 2024, before the opening of the market. Drawn by the author
"Mr. Bao" is speculating on big blue chips
In "Flowers", when the young Ah Bao first started to buy "electric vacuum", the "scalper" introduced this stock as "big and a leading stock". Indeed, compared with the total shares of 500,000 yuan in Feile Audio, the scale of vacuum electronics is much larger.
In 1986, Shanghai Municipality began to brew a pilot project for large and medium-sized state-owned enterprises to issue shares on a trial basis.
In January 1987, the first landing: Shanghai Vacuum Electronic Devices Co., Ltd., transformed into Shanghai Vacuum Electronic Devices Co., Ltd., with a total registered share capital of 200 million yuan, of which 51.09 million yuan was raised by issuing shares to the society. In that year, it issued 145,000 shares at a price of 100 yuan per share through over-the-counter trading, and in 1988 and 1989, it continued to issue the remaining 365,900 shares. This is what early investors called the "electric vacuum".
This was an astronomical figure at the time, and it can be referred to that by 1987, Shanghai's GDP had just exceeded 50 billion yuan.
The predecessor of "Electric Vacuum" is the Electric Vacuum Industry Company of Shanghai Instrument and Telecommunications Industry Bureau, which is the earliest company in Shanghai to produce black and white TV picture tubes. An important purpose of this stock issuance was to raise funds for the construction of color television picture tubes, which could not be produced in China at that time.
"Electric vacuum" has naturally become the earliest "large-market blue chip". Shanghai Securities News once interviewed Gu Peizhu, the former chairman of "Electric Vacuum": "Among the old eight stocks, the capital and trading volume of the other seven stocks such as Feilo Audio are less than half of that of Electric Vacuum. Even after the opening of the Shanghai Stock Exchange, this situation persisted for a long time.
In 1987, Shanghai Vacuum Electronics shares were issued at an issue price of 100 yuan per share. Source: China Securities Museum.
In "Flowers", the "electric vacuum" made Po famous. In the initial period of China's stock market, Yang Huaiding, a well-known retail investor "Yang Million", was named "million" by speculating in the "electric vacuum".
"Yang Million" once recalled to Nanfeng Window Magazine: In 1990, with the profits obtained from speculating in treasury bills, he "boldly bought 2,000 shares of electric vacuum stocks with a face value of 100 yuan". After September 28, 1990, the price of electric vacuum in the Shanghai stock market rose rapidly to 700 yuan per share, and after the National Day, it rose to 850 yuan. At this price, I sold my entire electric vacuum stock. Then the stock price fell rapidly, but I was able to complete the 'million' journey that I never dreamed of. ”
Gu Peizhu, the former chairman of "Electric Vacuum", also recalled: "The highest income of electric vacuum has increased 25 times, that is, 100 yuan to 2,500 yuan. ”
Of course, the massive funds raised by the "electric vacuum" are all used for the construction of the first phase of Yongxin color tube. This also made this company later become one of the eight major color picture tube manufacturers in China, along with Beijing Panasonic Color Tube, Samsung SDI China, Thomson Guangdong and other foreign-funded enterprises, and throughout the 1990s, it was very profitable.
Four bull-bear conversions of the Shanghai Composite Index in the early 1990s. Drawn by the author
At the end of "Flowers", Mr. Bao quoted a sentence from "Gone with the Wind" when negotiating with the Kirin Club, saying that he would withdraw from the stock market and concentrate on planting flowers.
The follow-up to "Yang Million" is not so romantic, but it is also worth mentioning: in 1993, he invested the money he earned in the stock market in real estate.