Chapter 158: Capital Influx
Chapter 156 Capital Influx
The Vienna Stock Exchange, established in 1771, was the largest stock exchange center in Eastern Europe in this era, bringing together investors from all over Europe.
June 11, 1850 at six o’clock in the morning, the Vienna Stock Exchange, this time is already crowded.
What could make the stockholders come over early to line up was naturally a big event. Austria’s largest railroad company, the Austrian Federal Railway Operating Group, went public here today.
After such a long time in the making, the concept of railroad stocks has long been fired up, and almost everyone thinks that this sunrise industry will be able to bring them rich returns.
A middle-aged man in fancy clothes got off the carriage and looked at the queue of people and cursed, “Damn, why are there so many people today, are they rushing to get to Geh scheien!”(Eat shit?)
His actions soon caused people to look at him angrily, the young policeman who was maintaining order came over and said disgruntledly, “Sir, please pay attention to the quality, this is a high-class place, the use of profanity is prohibited.”
The man in Chinese clothes obediently shut up, he knew that if he continued, there was no chance that a charge of disturbing public order would come down.
Normally it doesn’t matter, the big deal is to go to the police station, swear a few words, it’s not a big crime at all, pay a fine and be done with it.
But not today, hit the new shares has always been the favorite of the shareholders door, not to mention the potential of the railroad shares, if you miss today, and then want to buy is not in a price.
Seeing his reaction, the young policeman left with satisfaction.
The people who come here to line up will not be any big shot, the real big shot are directly into the VIP trading room upstairs.
The last thing that Vienna lacks is power and nobility, don’t look at these unassuming little police officers, it’s possible that they are the side branch of some noble family.
This point in fact look at the temperament to understand, thugs and aristocrats standing together are out of place, a glance can be distinguished.
Time passes by, the door of the trading hall opens at eight o’clock on time, and despite everyone’s urgency, they don’t rush to pour in.
The rules are very important here, look at the rows of police standing in front of them, people don’t want to be invited to the police station to drink tea. If they missed the trading time because of this, then they would only cry.
In this era, there is no internet, no electronic display, not even electricity, all transactions are conducted manually.
A large blackboard, the staff wrote data on it. Stockholders look at the data on it and decide whether they want to go to the trader to register their trades.
At this time, a stock exchange manager walked out and roared loudly, “The Austrian Federal Railway Operations Group has listed on the Vienna Stock Exchange today, with a total valuation of the company: 100 million guilders.
A total of three million shares were issued to the public, accounting for thirty percent of the total share capital, with an issue price of ten guilders per share, and a plan to raise thirty million guilders in foreign capital, so welcome friends who are interested in coming to snap up the shares.”
As soon as his words fell, they were followed by a staff member repeating them to the crowd, letting everyone know this information as much as possible.
There was no way, communication in this era depended on yelling, if you didn’t have a loud enough voice, you wouldn’t be able to eat this job.
……
Trading had already begun, and although it was said that three million shares were issued to the public, there were certainly not that many shares in circulation on the stock exchange, and the banks and stock companies had all subscribed to some of them in advance.
This is also the most common way to raise the stock price, if the circulation is too large, the market is saturated, even if it is a high-quality stock will also avalanche.
Concerned about the share price of a lot of people, this is related to everyone’s investment, the Austrian Federal Railway Operations Group’s share price, will directly determine everyone’s income.
Even Franz also attaches great importance to this listing, if the federal railroad stock skyrocketed, then Austria’s next big railroad construction will not have to worry, rely on the capital market can solve the funding gap.
As long as the railroads are built, the efficiency of the railroad company is good or bad, and Franz has nothing to do.
Can’t operate? No matter, the Austrian government does not mind taking over the bottom.
The big deal is that when the time comes to introduce a decree, the railroad company can not guarantee the normal operation, it will be nationalized. Anyway, the railroad is not profitable, but also the scrap metal price buyback.
On this issue, the government and the enterprise to judge the value of the standard is completely different.
For the government, the railroad can not make money, as long as the convenient transportation will lead to the development of other industries, these industries pay taxes also belong to the profit.
There are also political and military gains, which are likewise counted. This is why in later times many railroad lines lose a lot of money, the governments will still allocate funds to maintain the normal operation of the railroad.
In the evening, Meiquan Palace
“Your Majesty, as of this afternoon’s closing, the Austrian Federal Railway Operating Group’s share price increased by fifty-six percent, closing at 15.6 guilders per share.” Johann Stewart said excitedly
Undoubtedly, with such a lucrative deal in the stock market, how could the Royal Bank, as Austria’s most influential bank, not intervene?
For example, the listing of the Federal Railway, not to mention anything else, just the handling fee for the issuance of shares is hundreds of thousands of guilders, even though this kind of big deal is a joint effort by all of us, and the share of the hand is not a small amount of money.
Of course, the handling fee is only a small income, the real profit lies in the big head of the bookmakers, the stock market management system is not perfect in this era, leaving the bookmakers more room for maneuver.
Traditional industries in the financial market plate has long been divided up, under normal circumstances, we will not venture across the border, or today you sweep my plate, tomorrow I smashed your field, who do not want to make good money.
Emerging industries are different, now is the time to run, even if the financial large amount of face suddenly killed in the Royal Bank can not help.
Stewart is also mixed in the financial circle, know this so-called rules, in fact, first look at the backstage, then look at the capital, and finally look at the ability.
Royal Bank’s capital is certainly no way to compare with peers, manipulation ability is just a newcomer can not do the old bird, but can not afford to backstage big ah?
In that case, then we can only cooperate.
As the first manipulation, encountered the stock price soaring is undoubtedly a good luck, Stewart naturally excited.
Franz joked, “You guys did a good job, looks like you have your year-end bonuses this year.”
Once the management system is established, it can’t be tossed around, like that kind of casual bonus that is taken for granted, it is impossible to appear here in Franz.
Since the rules and regulations had been established, they had to be followed. What kind of performance was made, how much reward was taken.
Indiscriminate bonuses in the short term everyone is happy, but over time will realize that it is easy to break the rules and difficult to re-establish them.
Not all projects are the same money, some projects are laborious and laborious, in the short term can not see the return, but also need to be done ah?
The boss broke the rules, the trouble brought to the management, is undoubtedly huge, and in some cases there is no way to make up for it.
……
The surge in railroad stocks has something to do with the global economy. Since the British economy exploded in 1847, igniting the European Revolution of 1848, the world economy has been in various degrees of recession.
By 1850, the world economy had emerged from the crisis and started to grow cyclically, while Austria’s economy was still growing at a rate above that of the world economy.
The Austrian government initiated a major railroad program that attracted capital from all over Europe, and the influx of hot money naturally caused stock prices to skyrocket.
For these capital Franz has always been to come, money is no crime, who cares who his master is?
Even someone from the hands of the shareholders to buy shares of the railroad company, he pretended not to see, as long as the government paid taxes, these are legal behavior.
In this era, the Austrian government did not reject the idea of foreign capital, in the critical moment of industrialization, is in need of a large amount of capital.
At the critical moment of industrialization, a large amount of capital was needed. Who knows how long it would take to complete industrialization by using local capital alone? To be able to use foreign capital to speed up this progress, Franz is impossible to refuse.
Just think of the British investment in the construction of American railroads, from 1848 to 1858 on the construction of more than 30,000 kilometers, and finally, naturally, the loss of a mess.
To know this era, the United States only two-thirds of the population of Austria, sparse to the collapse, from the point of view of investment science, Austria’s railroads are obviously more economic value.
Being able to divert some of the money over is not surprising, except that Franz still underestimated the degree of British overcapitalization.
As the first country to complete industrialization, the British took advantage of this time lag to make massive profits from all over the world, which in turn translated into cash pouring into Britain.
More money is always used out, the British colonial expansion is still in progress, rebellions occur everywhere, the risk of investing in the colonies is too great.
The money then looked for markets all over the world, and in this context, the Austrian government’s launch of the Great Railway program caught their attention.
Just a little analysis, you will find that Austria’s population density is ten times greater than the United States, since the Austrian government completed the reform, the speed of economic development in the country on the fast track.
Even far away on the other side of the ocean in the United States, the British capitalists have not let go, close to Austria in Europe, naturally not let go.
A large amount of hot money poured in, and the money did not just flow to the railroad industry. Government-supported agro-processing industry, manufacturing industry are by the capital of the hot.
By the second half of 1850, the Austrian economy showed a kind of explosive growth, almost all walks of life in the savage growth.
In this era, the government was seldom directly intervening in the market, and people were not yet aware of it.
Franz knew that this kind of economic development was very unhealthy, and if it was not restricted, Austria would have an economic crisis in a few years due to overcapacity.
Should it be restricted? Franz hesitated at this moment, the economic crisis brought about by the loss of heavy losses, but the explosive economic growth, but also led to the development of Austria’s industrial development, increased Austria’s national strength.
This is also commonly known as the reckless wave, in a short period of time, the crazy expansion of production capacity, until the development of the limit will occur after the economic crisis.
Hesitation again and again, Franz still decided to wait and see, anyway, this is only the beginning of the outbreak, from the overcapacity is still early?
The world economic crisis had just passed and would not break out again anytime soon. Since the danger was not yet imminent, it was not too late for the government to intervene before it reached its limit.
(End of chapter)