PDLP Chapter 190 The Development of Dependency
Chapter 190 The Development of Dependency
Mid-September 1989.
Just like in the past, due to the extreme overheating of the real estate and stock markets, as well as rising inflationary pressures, the Bank of Japan officially announced a slight increase in the official discount rate in an attempt to cool down this increasingly out-of-control capital frenzy.
On a gloomy autumn morning, a cold rain had just washed over the Kanto Plain. A black Nissan Presidential Sedan drove smoothly on the Keiyo Road leading to Chiba Prefecture. The wheels rolled over the expansion joints of the viaduct, producing a monotonous and dull "clunk, clunk" sound at a fixed frequency.
Outside the car window, the gray surface of Tokyo Bay was faintly visible in the early autumn mist, and the blurry outlines of several ocean-going cargo ships were anchored in the anchorage, rising and falling with the waves.
The car radio was playing the morning financial news.
"...The Bank of Japan officially announced after the market closed yesterday that, in order to curb overheated asset speculation, it would slightly raise the official discount rate by 0.25 percentage points. Regarding this interest rate hike..."
The announcer's tone was relaxed and full of confidence in the economic outlook. Accompanied by the soft rustling of pages turning, the call connected to a commentary by a renowned economist.
"Please do not be overly concerned. This level of adjustment demonstrates the government's determination to maintain economic prosperity while implementing moderate control measures. Currently, corporate profits are good, overseas funds continue to flow in, and the slight increase in capital costs will not affect the Nikkei index's strong momentum to break through the 40,000-point mark by the end of the year."
Laughter from the radio filled the carriage through the speakers.
Executive Director Endo sat in the spacious leather seat in the back. He raised his right hand, pinched the edge of his gold-rimmed glasses between his index and middle fingers, and gently pushed them upwards.
His gaze passed over the radio panel that was playing, and landed directly on the thick stack of documents bound in kraft paper on his lap.
"Declaration of Transfer of Claims by Takada Quartz".
What the public perceives as macroeconomic "fine-tuning" manifests in a completely different physical form on the balance sheets of micro-enterprises.
Takata Quartz applied for a bridge loan of up to 2 billion yen from a Chiba Prefectural Bank to purchase commercial real estate in the port area. The collateral for this loan included factory land deeds, factory buildings, and even the right to revenue from core orders for the next three years. With leverage amplified by the booming real estate market, Takata Quartz's debt-to-leverage ratio has reached a dangerous four times.
Endo's gaze lingered on the total debt amount at the end of the document.
A 0.25% increase in the discount rate will immediately translate into a jump of at least 0.5% in short-term interbank lending rates for commercial banks. For a 2 billion yen bridge loan with daily interest, this means Takada Quartz will have to pay several million yen more in penalty interest each month.
As for Takata Quartz's corporate account, the liquid cash balance at yesterday's closing was a mere 800,000 yen.
At 9:00 AM this morning, the moment All Japan Commercial Bank opened its doors, Takada Quartz's liquid funds completely dried up.
The car drove off the highway ramp and turned into a traditional industrial area in Chiba Prefecture.
"Sizzle—"
The tires rolled over the potholes and puddles. The car gradually slowed down and finally stopped in front of the gate of the Takata Quartz factory.
The air was filled with a pungent smell of ozone. As the factory was operating at full capacity, extremely high heat waves rushed in through the gaps in the open doors, instantly dispelling the slightly cool air inside the vehicle.
In the distance, inside the massive factory building, huge electric furnaces were emitting a deafening roar.
Endo pushed open the car door and stepped out.
The factory manager's office is located on the second floor, right next to the noisy workshop.
The wooden door was ajar.
Endo reached out and pushed open the door.
President Takada slumped behind his cluttered desk. His gray overalls were completely soaked with sweat, clinging tightly to his back. One hand gripped the black telephone receiver tightly, and his heavy breathing echoed in the small space.
The cold, indifferent voice of the credit officer from the Chiba District Bank came through the receiver.
"President Takada, I am very sorry. Due to the tightening of risk control orders issued by the head office last night, your loan extension application has been officially rejected. Please replenish the margin account with 15 million yen by 3 PM today. Otherwise, the Ministry of Justice will directly initiate the collateral seizure procedure."
A dial tone then sounded.
That port area, which he had once regarded as a ladder to high society, had now become a rough noose around his neck that was tightening rapidly.
President Takada loosened his five fingers.
The black plastic receiver slipped from his sweaty palm and slammed heavily onto the wooden table with a "bang," knocking over the pen holder next to it. Several ballpoint pens rolled to the floor.
Suddenly, a flurry of footsteps came from outside the door.
"President!" The female secretary hurriedly pushed open the half-closed door, her face looking rather grim. "There are... there are guests from Tokyo outside, they..."
Before she could finish speaking, Endo, accompanied by two legal personnel carrying black briefcases, walked straight past the secretary and into the small, stuffy office.
As the creditor who held the power of life and death over the other party, he had no intention of waiting for the owner of the house to give his permission.
The well-tailored dark suit was completely out of place in the rural factory manager's office, which reeked of sweat and despair. Endo's leather shoes crunched on the composite floor, which was covered in quartz sand, making a dull "crunch, crunch" sound.
Takada raised his head blankly, his bloodshot eyes staring at the few cold-looking strangers in front of him.
"Who...who are you?" Takada's lips trembled, and he instinctively gripped the edge of the table. "Are you debt collectors from Chiba Bank? I already told you on the phone! There are still buyers negotiating with them for that piece of land in Minato Ward. If you give me another week, I can definitely raise the deposit..."
Endo stood quietly in place. He let the urgent pleas echo in the stuffy room, watching his farce with a calm gaze.
As Takada's voice gradually weakened due to a lack of confidence, Endo finally took a step and walked to the messy desk.
He pulled the heavy file bag from under his arm, untied the tangled cotton thread, and laid out a stack of bad debt certificates stamped with various bank seals, along with a "Notice of Enforcement" issued by the Tokyo District Court, on the table.
President Takada's voice abruptly stopped. He slowly lowered his gaze, looking at the documents that pronounced death sentences.
Endo's lips curled into a standard business smile, and he adopted a formal, businesslike tone.
"President Takada, Chiba Regional Bank has transferred all of your non-performing loans to SA Investment."
"From a legal perspective, you have already committed a material breach of contract."
"Once bankruptcy liquidation proceedings begin, in addition to the auctioning off of all the assets of this factory, your unlimited joint liability as the legal representative will result in the confiscation of all your personal real estate and vehicles. You will be burdened with a huge debt that you will never be able to repay and will completely lose your current family life."
President Takada's body trembled violently. He gripped his hair tightly with both hands, and a suppressed whimper, like that of a wild animal on its deathbed, escaped his throat.
Endo extended his right hand and pushed a thin agreement and a pen with the cap removed to the top of the debt certificates.
"Debt-to-equity swap and corporate control transfer agreement".
"Sign this document."
"You will relinquish 100% of the equity in Takada Quartz. In consideration, SA Investment will fully divest your 2 billion yen debt and provide you with an additional 50 million yen in personal resettlement allowance."
Endo withdrew his hands and placed them in front of him, overlapping them.
"This is the only solution."
President Takada looked at the fountain pen.
Sweat dripped from his chin onto the edge of the document, spreading into a small water stain.
If he refuses, bankruptcy proceedings at the Chiba Regional Bank will begin immediately, all his personal properties and savings will be seized, and his wife and children will be burdened with a debt they can never repay. This agreement, while stripping him of his proud, century-old family fortune, will cut the financial noose that is about to strangle him, providing his family with the means to survive.
The plundering of capital is often bloodless. When the fine-tuning of macro policies and the heavy pressure of financial leverage completely block all escape routes for grassroots enterprises, "voluntarily surrendering everything" becomes the only way for the prey to save its life. In the face of absolute debt crushing, any insistence on craftsmanship and dignity seems pale and meaningless.
He stretched out his right hand, trembling, and after struggling for a while, finally gripped the pen tightly.
The pen tip landed on the signature column.
"Shh shh shh".
The name is signed. The ink is deeply embedded in the texture of the paper.
……
3 PM.
Marunouchi, Tokyo.
Saionji Corporation headquarters, top floor, president's office.
The central air conditioning vents continuously spewed out dehumidified cool air. Sunlight streamed through the huge floor-to-ceiling windows, illuminating the gleaming marble floor.
Executive Director Endo stood in front of the large mahogany desk, leaning slightly forward.
He held in both hands a brand-new corporate seal representing the highest authority of Takata Quartz, and an invitation to the annual core supplier conference bearing the blue logo of Shin-Etsu Chemical.
Press your arms down.
The two items were respectfully placed on the table in front of Satsuki.
"Miss, the legal procedures for Takada Quartz have been completed. We can access the factory's core production data at any time."
Satsuki sank into the soft leather swivel chair.
Her gaze passed over the invitation and landed on an object placed on the corner of the table.
It was a translucent quartz crucible sample with a glassy texture. Its shape resembled a deep, round bowl, and its surface was polished to an extremely smooth finish, refracting a pure and cool luster under natural light.
Satsuki stretched out her right hand, her fingertips touching the cold edge of the crucible.
"The crystal pulling process for monocrystalline silicon requires melting at a high temperature of over 1,400 degrees Celsius inside this crucible."
Satsuki's fingertips slid slowly along the curve of the crucible.
"In this extremely harsh physical environment, the quartz crucible must remain absolutely chemically inert. Even the release of one part per billion of impurity ions can cause defects in the lattice of the entire silicon rod, rendering it unusable."
"This seemingly inconspicuous container is the 'womb' that nurtures silicon wafers with a purity of eleven nines (99.999999999%)."
She withdrew her hand and turned her gaze to Endo.
"Controlling this blood vessel is like controlling the oxygen supply tube in Shin-Etsu Chemical's throat."
Although Shin-Etsu Chemicals has defended itself as solidly as possible in terms of finance and equity structure, as long as the lifeline of its core consumables is in the hands of the Saionji family, this impregnable fortress will open its doors to invaders from within.
"Executive Director Endo."
"Yes." Endo immediately straightened his back.
"Using SA's secret funds, they secretly carried out a comprehensive technological upgrade and capacity expansion of Takata Quartz's production line."
"We will introduce state-of-the-art electrofusion equipment to improve the purification precision of quartz sand. We will spare no expense to enhance the quality of this supplier's supply and delivery efficiency."
"Using absolute advantages in capital and production capacity, we will completely secure Takata Quartz's position as the 'exclusive supplier.' This will allow Shin-Etsu Chemical to become complacent with this impeccable supply for the next few years, thus voluntarily abandoning any plans to cultivate alternative channels."
"Until Shin-Etsu Chemical's semiconductor production line can no longer function without it."
Endo's mind quickly translated this instruction into specific financial budgets and execution steps.
"Understood. The first installment of funds for the technological upgrade will be deposited into Takata Quartz's dedicated account tomorrow morning."
The instruction has been issued.
Endo bowed slightly and took two steps back. He turned and walked to the door, grasped the brass doorknob, and opened the door.
Step out.
The heavy oak door, controlled by hydraulic damping, made a slight hissing sound before slowly closing.
The door lock clicked shut, completely shutting out the faint footsteps that occasionally drifted down the corridor.
The only sound in the office was the faint whirring of the central air conditioning vents.
Satsuki leaned back in her swivel chair.
She reached out and moved the invitation, which bore the Shin-Etsu Chemical logo, directly beneath the desktop light source.
With a slight lift of her wrist, she picked up the translucent quartz crucible sample and placed it squarely on top of the invitation.
The bottom of the high-purity quartz glass has a subtle curve, which acts as a natural convex lens.
Through the thick quartz base, Shin-Etsu Chemical's blue corporate logo was severely distorted and magnified by optical refraction, with even subtle dispersion appearing at the edges.
The heavy quartz crucible weighed down the paper, and a cold wind swept across the table, but the blue logo at the bottom remained motionless.