Recently, Li Ka-shing, the richest man in China, has been in trouble. This trouble may be a fatal blow for Li Ka-shing. Many people may think that this trouble is Li Ka-shing's loss of hundreds of billions in the UK. In fact, Li Ka-shing lost some money in the UK, but the so-called 100 billion is the value of the company's market value evaporation, and the company's performance impact is not large.
So what is Li Ka-shing's big trouble? According to Hong Kong media reports, Hong Kong will limit the number of election committees for a magnate consortium led by Li Ka-shing.
Li Ka-shing is a businessman, elections are a political matter, what does it have to do with Li Ka-shing? If you know Li Ka-shing and hong Kong, then you know how much this matter has affected Li Ka-shing. This place in Hong Kong is a little similar to South Korea, where it is the world of big chaebols. South Korea has the famous Samsung, and Hong Kong has four famous families, and the leader is Li Ka-shing.
In the past, Hong Kong tycoons protected their interests by influencing the political and media circles, and the root of their interests was real estate. Restrict hong Kong's land supply through slogans such as environmental protection to protect Hong Kong's property market. The high property market in Hong Kong can be said to be incomprehensible to mainlanders, and it is already the second largest in the world. In fact, the so-called land in Hong Kong is already a lie that everyone knows, and 70% of the green space is not developed, which is the reality.
The rich live in large mansions on the top of the hill, while the poor cannot even get a public rental house. Li Ka-shing is hailed by many as the world's richest man in stealth. His wealth is truly remarkable, and his business involves more than a dozen industries in more than 50 countries around the world. Of course, no matter how much Li Ka-shing has done and how many countries he has invested in, his base camp is Hong Kong, and it is Hong Kong's real estate.
Some time ago, Li Ka-shing released a report, which is a detailed record of Li Ka-shing's Changshi Group's 500 billion properties around the world, of which more than 300 billion are in Hong Kong, about 100 billion in the mainland, and the remaining 20 to 30 billion are in foreign countries.
This figure shows how important Hong Kong real estate is to Li Ka-shing's business empire. Li Ka-shing started with Hong Kong real estate, and how did Hong Kong real estate allow Li Ka-shing to accumulate such a huge wealth in just a few decades?
Hong Kong's property market developed in the 1950s, and there were many ups and downs in the middle, and Li Ka-shing successfully threw it at a high place every time, and then picked it up at a low place, so that a few times back, Li Ka-shing's assets doubled thousands of times.
From the listing of Li Ka-shing's Yangtze River Group in 1972, Li Ka-shing's personal assets have increased by about 5,000 times, which is still a conservative estimate.
In fact, Li Ka-shing has long seen through Hong Kong real estate, when he talked about his global development in the 80s, he said that Hong Kong real estate is policy-oriented, if the policy changes in the future, then the golden age of Hong Kong real estate will pass.
How do Li Ka-shing and others make money in the Hong Kong property market? Real estate in the mainland is manufacturing, and to put it bluntly, the added value earned by developers, who buy land and then build the land into houses. Then earn the difference between the land price and the construction cost and the selling price, and the net profit margin of mainland developers is generally about 10%. This is a very reasonable rate of return.
However, this is not the case for Hong Kong real estate rich people such as Li Ka-shing, who buy a piece of land and stockpiles it for a few years, then slowly start work, waiting for house prices and land prices to rise. Some people say that they don't have a cost for money, and they also need a cost. The key is that many of people's projects are own funds, and loans are very small. In this way, in addition to earning the difference in construction costs, their biggest profit comes from the rise in land prices.
However, the number of houses needed in a city each year is fixed, and you take the land but do not develop or slowly develop, which will cause the supply to exceed demand, that is, it will raise the price.
The mainland market is huge, so the situation is different. If the price of one city is too high, then talent will flow to other cities, and the Hong Kong market is too small, so Hong Kong people can't choose to go elsewhere. However, many Hong Kong people are now choosing to buy property in other cities in the Greater Bay Area because the cost of buying a home is much lower.
Li Ka-shing has many projects in the mainland, and he will make billions or even more when he sells them in 10 years. This model earns a lot and has a low debt ratio, which is a very safe way. Li Ka-shing made money in real estate and then invested in other industries, bringing many industries in Hong Kong under control. Not only Li Ka-shing, but also other property tycoons. So Hong Kong's economy is controlled by the big chaebols.
The drawbacks of this policy were discovered years ago. Because the price of houses in Hong Kong is getting higher and higher, and then the living pressure of the people at the bottom is getting bigger and bigger. So after '97, managers wanted to reform. However, Hong Kong chaebols have used various means to influence Hong Kong's political circles and hinder the progress of reform, the most typical of which is the downfall of Leung Kam-song. Liang Jinsong's reforms have been very effective, making the lives of the people at the bottom better, but they have hit the interests of the big chaebols.
So they thought of a way to get Liang Jinsong to step down. Eventually, many of the reform policies proposed that year were abolished. Many people also describe hong Kong chaebols as the kings of Hong Kong.
If you understand the movie "Cold War", you understand the politics of Hong Kong. It will be more convenient to let others line up on the stage. Movies come from reality. Read the movie and you'll understand.
No matter what Li Ka-shing thinks, he is the biggest beneficiary of the old system. Therefore, this change in the system, Li Ka-shing is naturally the most influential. In addition, from this matter, the manager's determination to crack down on the chaebol is also very clear. Chaebols can make money, but they can't bend the means, and they can't stretch their hands too long. If you try to influence the political circles to gain benefits, sooner or later there will be accidents.
Looking at the current situation, you may understand why Li Ka-shing began to develop internationally in the 80s. He had long known that this day would come sooner or later, but sooner or later. Now the first step is to reduce the influence of the chaebols, and then the upper and lower levels can reach a single heart, which is more efficient and will not encounter resistance, and then reform little by little.
In fact, if Li Ka-shing is smart, they should learn from Ho Hung-sun and actively embrace change and take the initiative to accept change.