Author: Shui Muran
Source: Shui Muran column (ID: smr669)
Let's first deduce the evolution process of the logic of making money:
In the more than 40 years since the reform and opening up, we have only completed one action: the process of primitive accumulation of capital.
If any country, enterprise, or individual wants to develop rapidly, it must solve the problem of primitive capital accumulation, and the same is true for China. This primitive process of capital accumulation is divided into three stages:
The first stage is the 20 years from 1979 to 1999.
In 1979, we began to reform and open up, and the market opened up all of a sudden.
At this stage, doing business is all about buying and selling, and the master is running around, and making money depends on taking the lead, diligence and courage. If others have not acted, you will act, if others have acted, you will be more diligent, and if others are diligent, you will rely on courage, in short, you will definitely be able to earn money if you dare to move forward.
It wasn't until 1999 that China gave birth to the Internet and real estate, and the second stage arrived!
The second phase is the 10 years from 2000 to 2010.
At this stage, after the birth of the Internet and real estate, the information gap was gradually filled, and housing prices soared. Making money at this stage mainly depends on the appreciation of "capital". For example, the appreciation of so-called good assets such as houses, land, original shares, etc., makes ordinary workers sigh with admiration, and the speed of making money through labor has lagged far behind the appreciation rate of "assets".
The same is true for many entrepreneurs, whose own businesses are becoming less and less profitable in the end, but their land and factories have been appreciating in value, and then the situation is 2010.
The third stage is the 10 years from 2011 to 2021.
Since 2010, China has entered an era of capital explosion. As long as your "assets" are valued by "capital", it will take the initiative to help you operate, as long as you catch the express train, your assets will soar all the way, and making money at this stage mainly depends on "capital operation".
For example, many young people can get millions of financing with just one idea, and then get a valuation of tens of millions, and their worth is tens of millions, which can surpass the accumulation of traditional entrepreneurs for many years overnight.
For example, many capital tycoons have been constantly investing and merging and merging, and they have reorganized through backdoor restructuring, and even deceived the world, quickly fattening one company after another, and then cashing out and withdrawing.
As a result, many listed companies no longer have the patience to do their main business, but continue to acquire and invest, and then increase their market value and expand rapidly.
So, the bubble quietly began to be blown up!
In fact, the stock of a listed company has not changed much from one dollar to one hundred yuan, and the money earned has not changed much, but the investors behind it can take the opportunity to realize it.
Only by blowing up the bubble can capital make a lot of money. This continued until 2020!
Let's sort out the evolutionary theory of China's money-making logic:
The first stage (1979-1999) was the stage of material scarcity, and it was a stage of making money from products;
In the second stage (2000-2010), the Internet and real estate arrived, which made money from assets;
The third stage (2011-2021), the era of asset bubbles, relies on capital operation to make money;
So what's happening right now? It's important to remember one principle:
From now on, be sure to cherish your cash!
Over the past 40 years, we have completed the process of industrialization, marketization and urbanization in three stages, absorbing a large amount of money, which has been hoarded in the form of assets such as real estate.
In the past, in order to follow this trend, we continued to invest (such as buying a house) to gain wealth appreciation, but at a certain stage, many assets began to bubble, and the liquidity of cash will inevitably become more and more tight, and there will be less and less money in the market.
We have been emphasizing that we are now experiencing a rare inflection point of change: money is not easy to earn, taxes are formalized, housing prices are stabilizing, and there is no opportunity to invest.
The next phenomenon will be staged: the value of many assets (including housing prices, stocks, equities, factories, etc.) will shrink significantly, the most obvious is houses in third- and fourth-tier cities, flashy concepts, illusory entrepreneurial projects, various Ponzi schemes, etc., these assets will be beaten back to their original shape, and the rational approach is to abandon such assets as soon as possible.
Coupled with the impact of sudden disasters such as the pandemic and war, the value of various assets will shrink even further. Next, many assets will be under pressure to be sold off en masse. This is when the importance of cash begins to come to the fore! Because cash is the best weapon against the liquidity winter, you can be prepared if you have enough cash.
Some people will say: now the currency is still overissued, and the reserve cash can only be depreciated. I would like to remind you that the loss from the depreciation of wealth is much lower than the loss from the bursting of the bubble! The lesser of two evils meets.
These are the four stages of the primitive accumulation of capital:
1: The generation of capital - the production of products to make money
2: Appreciation of capital - buying assets to make money
3: The operation of capital - the operation of assets to make money
4: The destruction of capital - a return to labor to make money
Capital must disappear in the end, because the biggest characteristic of capital is two words: appreciation. As long as capital cannot be increased, it will die.
Since capital will eventually die, what is the meaning of its existence? Four words: prosperous market, just like drinking beer, the meaning of foam is to make beer taste better, but before drinking beer, the foam must be blown off.
The economy is like beer, and capital is like a bubble. Only when capital is blown apart can the economy return to "getting rich through labor", and everyone can work and create in a down-to-earth manner, and it has always been the fine tradition of the Chinese nation to get rich through hard work.
Finally, to sum up: China's barbaric and extensive growth stage has officially passed, and every penny we earn in the future is the realization of labor and value. From now on, give up any speculative illusions and enter a down-to-earth state.