Chapter 42: Broad Analysis

After enjoying their meal and drinks, the waiter cleared the leftovers and replenished the tea for Xia Yu and Liu Tianci.

Liu Tianci took a sip of tea, exhaled, and asked, "Mr. Xia, what are your insights on the current stock market in Hong Kong?"

Hearing Liu Tianci's question, Xia Yu's expression became serious. He didn't rush to answer, instead taking a moment to organize his thoughts and decide on the direction of his response.

Although they were chatting, it was essentially a process of mutual observation and understanding. Liu Tianci's question was quite common and easy to answer, but if Xia Yu wanted to demonstrate his expertise and impress Liu Tianci, he needed to consider his response carefully.

One's value and abilities determine whether relationships remain superficial or deepen into genuine friendships. If one lacks recognized value and competence, the relationship won't last long.

Thus, Xia Yu needed to display enough capability to further impress Liu Tianci, making him recognize and genuinely appreciate Xia Yu, and be willing to establish a deeper connection.

With this in mind, Xia Yu knew his response had to offer something new and insightful.

His mind raced, and soon he had a brilliant idea. He set down his teacup and prepared to speak.

Liu Tianci, who had been quietly waiting and observing, noticed Xia Yu's change in demeanor. He knew that Xia Yu was about to provide an answer. Liu Tianci straightened up, focused intently, and leaned slightly forward, ready to listen.

Liu Tianci had already placed significant importance on Xia Yu. Otherwise, he wouldn't have offered such a substantial compensation. Additionally, he subscribed to "Jiu Ding Daily" and read every financial analysis article written by Xia Yu. From these, he could clearly sense Xia Yu's sharp thinking, strong logical skills, and exceptional financial acumen. Xia Yu's literary talent also impressed him.

Moreover, Liu Tianci was aware of Xia Yu's every move and observed many things, gaining insight into Xia Yu's remarkable abilities.

He didn't understand how Xia Yu, at such a young age and without attending university, acquired such professional knowledge or honed his skills. However, Liu Tianci wasn't particularly curious about these irrelevant aspects that might annoy Xia Yu. He preferred to attribute Xia Yu's exceptional abilities to innate talent.

Given their brief acquaintance, Liu Tianci didn't know much about Xia Yu. Much of his understanding came from surface-level analysis. Now that he had the chance to communicate face-to-face with Xia Yu, he wanted to gain a deeper understanding to better gauge how much importance to place on their relationship. This understanding was crucial for determining the level of attention he should give Xia Yu.

At this moment, Xia Yu finally spoke. Clearing his throat, he said seriously, "I believe that the future of Hong Kong's stock market is limitless. It is crucial for Hong Kong's positioning and development, and it could even help Hong Kong become a financial center in the Asia-Pacific region, as important as Wall Street to the United States and London to Europe. It could even help Hong Kong become a global financial center."

Liu Tianci was startled. His expression became serious, and he looked intently at Xia Yu, fearing he might miss a single word.

He hadn't expected Xia Yu to elevate the status of Hong Kong's stock market to such heights. This was completely unexpected and far beyond his imagination. He had a sudden premonition that tonight's meeting would yield unprecedented gains.

Seeing Liu Tianci's reaction, Xia Yu felt certain that his point had made the intended impact. Liu Tianci seemed unable to contain his excitement.

In reality, anyone in the financial industry knows that Hong Kong is already an extremely important global financial center. Many experts and financial giants have analyzed and interpreted Hong Kong's development as a financial center extensively. A simple online search could provide a wealth of information that would take days to read through.

For Xia Yu, who had access to so many memories of financial giants, information about Hong Kong was readily available. Even if he hadn't studied it directly, he could analyze it from the perspective of future insights. After all, anyone managing a major financial firm would be well aware of the conditions in Hong Kong.

Xia Yu continued, "In fact, Hong Kong has several fundamental conditions for becoming a financial center, which I summarize as four key points."

"First is geographical advantage. First, there's the global positioning advantage. Hong Kong, London, and New York divide the world's financial activities. Their time zones complement each other: when New York finishes its workday, Hong Kong starts its day, and when Hong Kong ends its day, London begins its work. This allows for 24-hour global financial operations. Secondly, there's the advantage in Asia. Hong Kong is at the center of East Asia, with flight times to most major cities in East Asia not exceeding four hours. Lastly, there's the national advantage. Being backed by a mainland with a population exceeding one billion, Hong Kong has tremendous market potential. Even though the mainland is not wealthy now, no country remains poor indefinitely without change. Moreover, the situation is already changing, and Hong Kong will become the ideal external window for trade, propelling its economy."

"Second is institutional advantage. Hong Kong has a relatively complete legal system. The Hong Kong government's prohibition on new stock exchanges in recent years shows their ongoing strengthening of regulation. The future merger of the four major exchanges is a trend, leading to a financial and economic supervision mechanism that is systematic, stringent, efficient, and in line with international practices. Hong Kong will have a flexible, efficient currency control system, a commercial banking system, and a securities company system that allow for fair, reasonable, and competitive operations. Additionally, Hong Kong's legal guarantees cover land, shares, stocks, bonds, and derivative ownership, registration, and trading. The low transaction costs in Hong Kong's financial market are evidence of its increasing trading volumes year after year."

"Third is a stable political and economic environment. The funding sources and uses in Hong Kong's financial market are not limited to the local market, which relies on political stability. Southeast Asia has a lot of speculative funds, particularly from overseas Chinese, some of which are long-term and some short-term. Due to unstable local political situations, they seek alternative routes. Hong Kong's political stability is significantly better than nearby Indonesia, the Philippines, Thailand, and Malaysia, making it a suitable channel for international capital."

"Fourth, Hong Kong's economy has been booming since the 1970s, with rapid growth in real estate, industry, commerce, catering, and trade. This growth has attracted significant foreign investment, which needs corresponding financial institutions. Moreover, the Hong Kong dollar is pegged to the British pound, ensuring its stability."

"So, from these perspectives, Hong Kong's financial industry will definitely flourish, and Hong Kong has all the favorable conditions to become a financial center. The stock market in Hong Kong will continue to improve in the long term!"

After finishing, Xia Yu took a sip of tea and said no more.

From Liu Tianci's shocked expression, it was clear that Xia Yu's insightful analysis had deeply impressed him.