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Hunting in Hollywood

A continental director from many years in the future unexpectedly returns to Hollywood in 1986, and so begins his legendary journey to take step-by-step control of the center of the world's largest film industry. ----------------------- It's 1 chapter per day at 1 p.m. (Arizona) in every novel I upload. 3 daily chapters in each novel on patreon! p@treon.com/INNIT ----------------------- DISCLAIMER The story belongs entirely to the original author.

INIT · Celebrities
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395 Chs

Chapter 310: Rumors

On the same December 1st, across the ocean in Japan, after another interest rate hike by the Bank of Japan in November, the Nikkei 225 index still maintained an upward trend amidst fluctuations, breaking the 40,000-point mark in the afternoon.

By the close of trading local time in the afternoon, the Nikkei 225 index finally settled at 40,039 points.

As various sectors in Japan celebrated this record-breaking moment, a rumor originating from Wall Street quickly began to spread.

According to very reliable sources, Cersei Capital, which has been the focus of the financial world in recent months, has actually quietly exited the Japanese market.

The portfolio of financial securities related to the Japanese market held by Cersei Capital's Funds No. 1 to 5 were all sold to a Japanese consortium by Simon Westeros. Thus, many hedge funds that have been following Cersei Capital's operations around the Japanese market were actually following the Japanese government!

In the past few months, at least tens of billions of dollars of capital in the entire financial market have been following Cersei Capital to chase the Japanese stock market. Everyone understands what it would mean if the rumors were true.

The news was released after the Japanese stock market closed on Friday, and due to the time difference, it was still Friday morning in North America.

The Lehman Brothers team originally planned to let the rumor ferment over the weekend, to create enough panic before the market opened on Monday.

However, the speed of the rumor's spread far exceeded the expectations of the Lehman Brothers, reaching not just Wall Street, but everyone, informed or not.

The first thought of the North American local media was to contact relevant individuals at Cersei Capital to verify the authenticity of the news.

However, many media outlets found that Simon Westeros was not in North America, and even James Reubold, the president of the Westeros Company, was far away in Europe. Another key figure at Cersei Capital, Janet Johnston, was also unreachable. Attempts to contact senior executives at the West Coast-based Daenerys Entertainment also failed to yield any useful responses.

Compared to the media, some investment bank executives and even high-level government officials also tried to contact Simon Westeros, but were unable to reach him directly. James Reubold, who could be contacted, was also vague, which was a clear implicit confirmation.

Therefore, although the spread of the message exceeded the Lehman Brothers team's expectations, one thing they did not miscalculate was the onset of panic!

Cersei Capital's target was too obvious, and there were too many informed individuals, coupled with various undeniable associations. Simon never thought that this could be kept secret forever, and the Japanese did not expect it either. The most important term in the agreement between the two parties was that Simon would no longer engage in short-selling the Japanese stock market after it turned.

Athens, Greece.

Because London was too cold this season, Simon and Janet only stayed there for three days before flying together to Athens, the capital of Greece by the Mediterranean.

When they received news from North America about the leak of Cersei Capital's Funds No. 1 to 5, Simon and Janet had just returned from the Johnston family's private island in the Aegean Sea. They were resting in a mansion in the affluent area of the northern mountains of Athens and planned to rush to Finland on Monday.

The acquisition team of the Westeros Company had already finalized the last contract details with Nokia, and the two sides were to sign the agreement on Monday.

Since Simon had anticipated this day, he was not surprised.

Originally planning to keep silent according to the plan, Simon's leisurely detachment was interrupted by the sudden visit of Haruo Maekawa, the former president of the Bank of Japan, who he met in Melbourne at the end of June, on Sunday noon in Athens time.

Haruo Maekawa and his party of four, including himself, Yoko Kosugi, the 'gift' Simon had always refused, who was still following him under the guise of being Maekawa's translator, and two assistants to Haruo Maekawa.

After a brief greeting, Simon led Haruo Maekawa and his party to the terrace in the mansion's backyard.

The mansion, built on 6 acres of land against the mountain, had a specially constructed viewing terrace that overlooked the entire city of Athens. Because it was too far from the coast, the sea level was not visible. However, being in an affluent area, the view was naturally excellent.

However, Haruo Maekawa was not in the mood to appreciate the scenery. Once the servants brought out coffee and Haruo Maekawa, looking noticeably tired, regained some spirit, he said with a smile, "First of all, congratulations, Simon, on the 'Teenage Mutant Ninja Turtles' game. It seems to be selling well these days."

Simon took a sip of his coffee and nodded with a smile, "Thank you."

"I did some research before coming here, and Yamauchi's royalty system for Nintendo has been somewhat excessive over the years. Since Daenerys Entertainment intends to enter the video game field and has already achieved such remarkable success, I think it's only right for Nintendo to give Blizzard Studio a special discount, in addition to Capcom, Konami, and other companies."

Nintendo's royalty system involves reviewing the content of game manufacturers and extracting a royalty from each game cartridge as a licensing fee.

Additionally, Nintendo monopolizes the production of game cartridges, further squeezing the profit margins of game manufacturers.

Because Capcom, Konami, and six other game companies were the earliest content providers for Nintendo, after Nintendo rose to prominence, it granted these companies a special discount policy. These companies are allowed to produce their game cartridges independently, and the royalties they need to pay are much lower than those of ordinary game manufacturers who do not enjoy this discount.

The "Teenage Mutant Ninja Turtles" video game released by Daenerys Entertainment last month, with a retail price of $60 per cartridge, taking into account the cost of cartridge production and royalty, Nintendo takes $20, leaving Daenerys Entertainment with about 30% gross profit from each cartridge.

Compared to Capcom, Konami, and other companies that enjoy special discount policies, their gross profit from each game cartridge can reach 50%.

Nancy previously estimated that the "Teenage Mutant Ninja Turtles" first-generation game could bring the company $100 million in profit over the next year. If they receive Nintendo's special discount policy, this figure could increase by at least 50%.

Haruo Maekawa offered such generous terms almost without any preamble, which somewhat surprised Simon. He did not doubt that Maekawa was making empty promises. Although Nintendo's president Hiroshi Yamauchi is strong-willed, Japanese companies are basically under the control of various consortia, and Nintendo is no exception.

If the higher-ups of the Japanese consortia exert pressure, Yamauchi, no matter how strong-willed, would have to comply.

Nintendo could maintain its peak for at least another five years, and such a special discount could mean hundreds of millions of dollars in profits for Daenerys Entertainment.

However, Simon did not show too much emotion on his face, nor did he immediately accept Maekawa's offer, but said, "Actually, I quite appreciate Nintendo's royalty system."

Hearing this, Maekawa realized he had been too eager and followed Simon's tone, "That surprises me

, Simon. In recent years, there has always been criticism of Yamauchi's decisions. Last year, two special discount manufacturers even broke with Nintendo."

Simon said, "Without constraints, many business fields would rapidly prosper and then rapidly decline, just like Atari's crash. Nintendo's system is a restraint on the market, allowing the video game industry to move towards a sustainable and healthy development. So, Nintendo's system is not wrong. Those manufacturers that broke with Nintendo, if given the chance to set the rules, would do the same."

Maekawa nodded and asked with a smile, "What about you, Simon?"

"Of course, I feel the same," Simon said. "In fact, everyone has the ambition to become a rule-setter, but most lack the capability."

Suddenly, Maekawa asked, "Simon, do you want to defeat Nintendo?"

Simon shook his head, "Daenerys Entertainment does not plan to enter the console market; we will only focus on game content development. However, both Atari and Nintendo have proven the lucrative nature of the game console industry, which is bound to welcome many new players. Moreover, Nintendo's sluggishness in the new generation of game consoles is well known. Sega's 32-bit game console has been out for nearly a year now, but Nintendo's SFC continues to be delayed. So, it is doomed to decline, not because of the royalty system but because of its own lack of progress."

As Simon said this, he thought of Apple.

Apple's cut from app sales is actually imitating Nintendo's royalty system. On the other hand, compared to Nintendo's lack of progress, Apple always manages to stay ahead of the Android domain, making it difficult for the Android camp to compete with Apple.

"I will convey your words to Yamauchi," Maekawa said, picking up the coffee in front of him and sipping it before getting to the main point, "Simon, I came here hoping you could make some public statements."

Simon nodded, waiting for Maekawa to continue.

Maekawa said, "We have already found out that the news came from Lehman Brothers, a subsidiary of American Express. The situation in North America and Asia has been terrible in the past two days, and we hope you can publicly express optimism about the Japanese economy in some media."

Simon asked, "What about Cersei Capital's Funds No. 1 to 5?"

"That's also a key point," Maekawa continued. "We hope you tell the media that you transferred the investment portfolio of Cersei Capital's Funds No. 1 to 5 in June, but the Japanese stock market did not show signs of decline in the following half year, which proves that the Japanese economy is more vibrant than many predicted."

Simon did not mind that Maekawa inadvertently moved the timeline of Cersei Capital's Funds No. 1 to 5's transfer to June; technically, it was not wrong, as the deal was indeed confirmed at the end of June, "Actually, Maekawa, you should understand that my statement now won't make much difference. Since Lehman Brothers released the news, they must have already established a large number of short positions, and perhaps, many financial institutions have already done so in advance."

"But there are also many long investors who haven't left the market," Maekawa replied. "Simon, as long as you make a statement, those funds that are still long will definitely take action. We will also do our best to maintain market stability."

Simon said, "Maekawa, you should know that the Japanese economy indeed has a severe bubble, and a downturn in the Japanese stock market is inevitable."

"I understand, Simon. We just hope that this downturn can be more gradual, giving us more time to adjust."

Simon weighed his options while holding the coffee cup in his hand.

The Japanese stock market breaking through 40,000 points clearly indicated a peak; it could not continue to rise, and a decline was inevitable.

In his memory, the Japanese stock market fell from over 38,000 points to 28,000 points, taking four months, which was indeed quite gradual and showed the effectiveness of the Japanese government's market rescue measures at the time.

Now, if he does nothing, given the panic accumulated in the market over the past two days, even though the Japanese stock market has limits on rises and falls preventing a crash like North America's Black Monday in 1987, the market could still see a catastrophic continuous decline when it opens next week.

If this happens, some hedge funds misled by Cersei Capital could suffer heavy losses, and they might inevitably blame Simon.

On the other hand, if Simon now shows some optimism about the Japanese market, slowing the stock market's downturn and giving those hedge funds time to exit, it would also be a way to mitigate any backlash against him. Since the Japanese stock market is destined to decline, doing so would only delay the short sellers from making money, which seemed reasonable.

Deciding on this course of action, Simon looked up at Maekawa and asked, "So, what should I do?"

Maekawa gestured for the two assistants waiting nearby to come over and took out a document from their briefcase, saying, "We have prepared some materials for you to review. Additionally, we have already contacted media outlets in Japan and North America. As soon as the article is finalized, it can appear on the front pages of many newspapers tomorrow morning. Moreover, if you are willing to accept a television interview, that would be even better."

Simon browsed the documents and shook his head, "Let's skip the interview. I'm not fond of appearing on TV."

"Then, making a statement in the newspapers will suffice," Maekawa did not insist and even proactively said, "Moreover, we will provide you with a copy of all the press releases we complete to ensure there are no unexpected disagreements between us."

Simon nodded, satisfied with the Japanese's arrangement.

He certainly did not want to see opinions he was completely unaware of appearing in the newspapers.

At the same time, he understood that the Japanese's caution was not out of respect for him, but more likely because they were worried he might suddenly renege on his agreement.

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