Chapter 541 The Benefits of Bubbles (Bug Fix): Bringing Your Own Money to Work

Throughout April, the team at Wuzhou Internet Company experienced both joy and torment.

The suffering is because the market is really bad. After the Qingming Festival, the Nasdaq index is like a funeral every day.

On April 14th, Black Friday, influenced by the better-than-expected inflation data (CPI) released the previous day, the market widely doubted that the Federal Reserve would aggressively raise interest rates.

As a result, a large number of sell orders were placed that day, causing the Nasdaq index to plummet, falling 9.67% in a single day, marking the largest single-day drop in its history.

By the close of trading on the 14th, the Nasdaq had fallen 34.2% from its high.

In other words, in just one month, more than one-third of the market value evaporated.

Do you think people working in internet companies experience a lot of stress?

It's going to be tough. Just look at the stock price; everyone's selling at a loss.

Given these circumstances, how can they be happy?

Let's find joy in hardship.

As the boss said, the steeper the market falls and the more depressed it becomes, the more likely they are to subdue their enemies without a fight.

Yes, it's just self-consolation. In this market, what else can industry professionals do but comfort themselves?

However, chip prices have not fallen.

Wang Xiao even went to the construction site to comfort Zhang Rujing and tell him not to worry: "Chips are hardware. They will only start to fall when the internet bubble has been squeezed out. There's no rush now. They won't fall anytime soon. We can wait patiently."

As the new millennium began, Zhang Rujing was constantly shuttling between construction sites in Shanghai and Hong Kong.

The sun is quite strong in both places, and in just a few months, he has become very tanned.

But upon hearing what Mr. Wang said, Dr. Zhang's face darkened even further.

Listen to what people are saying.

He couldn't take it anymore: "We haven't been making money from chips for very long, nobody wants prices to drop."

If we don't take advantage of the hard-won rise in chip prices to make more money, how will we make a living?

Wang Xiao pushed his hands away, looking utterly innocent: "Isn't this determined by Moore's Law? When it's supposed to fall, it will fall."

Since Zhang Rujing was a factory construction expert, he naturally had cost calculations in mind when he built a factory.

He couldn't help but sigh: "Simply having overcapacity is one thing, but then there's the financial crisis and the bursting of the bubble economy. There haven't been many good days. I thought I could climb up, but it's just another bubble."

The impact of this bubble economy on the economy was truly devastating.

Look at Japan, they still don't seem to have truly recovered.

It was practically equivalent to experiencing a war.

Not far away, a pile driver swung its heavy hammer, violently impacting the top of the pile, producing short, muffled "boom! bang!" sounds, like thunder exploding above people's heads, and the ground shook clearly in response.

Since construction officially started at the end of March, the pile drivers have been working non-stop, like a continuous earthquake.

The May sun was already intensely hot, steaming the entire earth.

The roar of diesel engines, the impact of heavy hammers, the rotation of drilling rigs, the whistles of cranes, and the shouts from walkie-talkies all mingled together, constantly drilling into people's ears.

The movement of the machine ahead became obscured, and dust billowed up instantly.

Thankfully, Mr. Wang was wearing a mask and a helmet, otherwise he would have gotten a mouthful of sand on the spot.

Even so, everyone quickly turned around and avoided getting sand in their eyes, which would cause them discomfort.

Even so, it couldn't stop Boss Wang from talking.

As soon as the dust settled slowly, she couldn't wait to start spouting nonsense: "If there really wasn't a bubble economy, wouldn't there be a war?"

Dr. Zhang felt like he was suffocating.

He was glad that Principal Tian had come to support the chip factory when it drove its first foundation stone, but wasn't there today.

Otherwise, Principal Tian would definitely be yelling at people. Is war something you can just casually talk about? We've had too many good days; we don't know how terrible war is. Anyone who has experienced war will never forget it!

Unfortunately, Dr. Zhang choked for a moment and took some time to organize his thoughts, so he couldn't stop Mr. Wang immediately.

So the other party continued to spout her fallacious logic: "Only war can mobilize the entire nation's strength. Whether it was World War II or the Cold War, it was a time when humanity shone brightly in the age of technology. The Manhattan Project's atomic bomb, the Apollo moon landing, and ARPANET, the precursor to the internet and defense communications—weren't they all driven by the national security needs brought about by the shadow of war?"

Whether the Apollo program actually landed on the moon or not remains uncertain.

But it was indeed one of the landmark events of the Cold War, a time when the entire nation was engaged in competition.

Wang Xiao continued, “The state can raise money through taxation and bond issuance, and forcibly concentrate huge amounts of capital and top talents in specific fields, directly bypassing the efficiency threshold of market selection. That’s why it was able to achieve such huge breakthroughs in basic science and engineering miracles in such a short period of time. The civilian and commercial applications of scientific research results are seriously lagging behind, but that’s still acceptable.”

The pile driver roared again, completely silencing Dr. Zhang's words.

But Mr. Wang isn't a particularly reasonable person, so since she didn't understand what the other party was saying, she decided to pretend he didn't say anything.

She hadn't finished speaking, so of course she had to continue: "But now the Cold War is over, in fact, it's been over for ten years. With the war over, there's a lack of overwhelming technological mobilization goals at the national level. So, how can technology develop rapidly?"

Dr. Zhang finally got a chance to speak: "Let's move over there, this place is too close."

Oh, Mr. Wang had no objection, so he immediately lifted his feet and followed him to the side.

Actually, she really didn't like going to construction sites. When they were building LCD screen factories and chip factories in Jinning and Xiaozhou, it was basically Ivan who went to the construction sites.

Since she can't rely on anyone else, she has no choice but to do it herself.

She's a boss, after all, so she should be there in person to show her concern and attention to the project.

Once we moved a little further away, the impact of the pile driver was noticeably less, and the dust stopped flying everywhere.

Ms. Wang firmly believed that Dr. Zhang had specially arranged this to make it easier for her to speak, so she couldn't let Dr. Zhang down and had to finish what she was saying in one go.

"As we all know, the two emotions that are most capable of mobilizing people's initiative are greed and fear. When faced with the threat of war, fear brings people together. In peacetime, the only alternative to the threat of war is the dream of wealth, which lures talent and capital into a new field, and then everyone gathers together and continues to rush forward."

She clapped her hands, her face beaming with a bright smile. "The internet economy bubble was such an irrational initiator! During the window of opportunity for technological paradigm shifts, without the allure of a bubble, rational, step-by-step accumulation would be too slow. Only through sheer force can miracles happen!"

“All major technology projects have very high fixed costs in the early stages and extremely long investment return cycles. If investors are rational enough, they will be very, very cautious in their investment decisions. Because when it comes to investing, everyone wants to get their money back as soon as possible. This is being responsible to themselves and to the investors they represent.”

Zhang Rujing had no way to refute this.

He's raised investment himself, so he knows this all too well.

At the end-of-year meeting, it's like the head steward in "Dream of the Red Chamber" reporting the accounts to his master.

If the financial statements presented fail to satisfy the major shareholders, it will be extremely difficult to get them to continue investing or even just allow the company to continue investing.

Wang Xiao smiled and said, "But it's different when there's a bubble. The irrational valuation brought about by the bubble allows the entire industry to easily obtain financing and build on a scale far exceeding actual needs, thereby quickly lowering the industry's average cost."

She sighed, "Aside from national warfare, only bubbles can do that."

Zhang Rujing did not refute this; during his time at Texas Instruments, most of the time was actually during the Cold War. The rapid development of the American semiconductor industry was due to national strategy.

In commercial activities, the government cannot interfere too much; otherwise, factories will be like clinging to a mother tree, never growing up and never able to independently withstand the storms of the market.

Such a major breakthrough in an industry seems to only be possible by everyone rushing in and growing wildly.

Wang Xiao laughed and said, "Actually, the entire internet industry should thank the bubble. Without the bubble, where would programmers, engineers, product managers, and all the other practitioners go to get their sky-high salaries and stock options? And without these, all those smart minds would flock to finance, law, and medicine. How could engineers compare to their respectability and social status?"

“Things are different now. High income means a sharp rise in social status, which means that the job is very attractive. With these smartest people entering the industry, receiving high-paying training, and having rich and brutal practical experience, even if the bubble bursts and the company goes bankrupt, they can become the core spark for the industry’s recovery.”

A voice came from behind: "Boss Wang is indeed very insightful."

Wang Xiao and Zhang Rujing both turned their heads.

Upon seeing the uninvited guest, Jiang Shangzhou, Zhang Rujing quickly took two steps over, helped the man out, and complained, "Why did you come here? Don't come."

Why go to such an exaggerated manner? Zhang Rujing is clearly several years older than Jiang Shangzhou, and they are quite familiar with each other. Logically speaking, there's no need to be so polite.

Oh dear! Can't officials go to construction sites? The president and the premier even go to inspect construction sites.

But Deputy Director Jiang is really not suitable to be on the construction site.

Because he had surgery in late February, and his follow-up examination was done a month after the surgery, it's not yet time for his three-month follow-up examination.

As for why the surgery was performed?

Wasn't it Mr. Wang who forced him to undergo a medical examination in Hong Kong? The initial examination results were questionable, so they had a follow-up examination, followed by a biopsy, which revealed a cancerous lesion.

Wang Xiao was also taken aback; she hadn't expected that Jiang Shangzhou had cancer so early.

So without hesitation, he quickly started making arrangements to find someone to perform the surgery.

But at this point, she didn't need to help anymore. Shanghai is a big city, and Jiang Shangzhou and his wife, Principal Wu, had their own connections. After the Lantern Festival, the surgery was done.

Although Zhang Rujing didn't know much about medicine, he firmly believed that since the lungs had already undergone surgery, they absolutely could not be damaged again.

What is Director Jiang doing at this dusty construction site?

Jiang Shangzhou was quite tall, and Zhang Rujing and Wang Xiao supported him on either side, like two unwieldy crutches, and they managed to carry him out.

Jiang Shangzhou was still trying to reason with them: "You don't need to be so nervous. Cancer is just like a big cold. It's not a big deal."

Zhang Rujing waved his hand dismissively: "Don't talk to me about that, I don't understand. I only know that you should listen to the doctor."

Good heavens, ever since he learned of this in January, he has been thankful even in his dreams, thanking the Lord for His blessing that Director Jiang was diagnosed with cancer so early. Otherwise, according to the doctor, if it had been delayed any longer, he wouldn't even have been able to have surgery.

Dr. Zhang, thinking of this, couldn't help but emphasize to him: "You need to take care of your health. You need to know that you are very important, extremely important."

As the saying goes, "every profession has its own secrets," and cross-disciplinary and multi-faceted talents are extremely scarce in any industry. Without these talents' forward-thinking ideas and strategic vision, it is difficult for an industry to integrate sufficient social resources and move forward by leaps and bounds.

Director Jiang is that kind of talent, a strategic scientist who is extremely rare in the government.

Whether from a personal or professional perspective, Dr. Zhang did not want anything to happen to him.

Jiang Shangzhou, after being persuaded so earnestly, could only plead, "Alright, alright, I'll listen to you. I won't go over there, okay? I was just attracted by what you said, and I couldn't help but follow you."

He smiled and gave Wang Xiao a thumbs up, "Boss Wang really does say the most insightful things; every time he does, it's like a revelation to me."

Mr. Wang was annoyed. Don't think that just because you flattered her, she'll be happy.

She glared at us, emphasizing quite seriously, "You could have called us over; we could have talked over here. What do you want to hear that we can't say in front of you?"

Jiang Shangzhou said in a serious tone: "I want to hear your opinion on how economic bubbles drive technological advancements."

Wang Xiao was momentarily speechless; she was now truly experiencing what it meant to be caught between laughter and tears.

She took a deep breath in exasperation and made a gesture that resembled pleading: "Okay, okay, I'll tell you, alright? Where was I?"

Jiang Shangzhou and Wang Xiao's assistant said in unison, "They mentioned that bubbles replaced war as the driving force for technology."

Oh, Wang Xiao remembered, blinked twice, and continued: "The bubble also serves another purpose, which is to pay for the trial and error costs of the whole society."

She gave an example: "I don't know if you've heard of artemisinin? It's a drug used to treat malaria. Its development was somewhat like a national project; it was a special project launched by the state to help Vietnam develop antimalarial drugs."

Jiang Shangzhou really did know, and he knew it even better than Wang Xiao.

In the 1960s, Vietnam was at war, and malaria was rampant in the country. To make matters worse, the malaria parasite had developed resistance to the effective drug chloroquine.

At the time, Vietnam was unable to independently develop new antimalarial drugs, so it sought help from China.

In 1967, my country launched an emergency military project codenamed "523" based on this, bringing together more than 500 researchers from across the country to begin developing new antimalarial drugs.

Wang Xiao listened and nodded: "Yes, yes, yes. We tried many, many medicinal herbs at the time. Artemisia annua, also known as Artemisia argyi, was one of them. The fact that it was discovered so quickly in just a few years is actually thanks to the trial and error with other medicinal herbs."

"Now the bubble also plays a similar role, with the frenzied market allowing thousands of business models to enter the fray simultaneously in a survival battle."

"The market uses the most brutal method—bankruptcy—to quickly verify which models are feasible and which are dead ends. Without bubbles to do this wide-net work, the trial and error process would be much slower. And because it's slow, it's harder to see clearly and it's easy to mistake the wrong for the right."

She laughed. "Look at all this complicated work, the bubble has done it all. In a normal market, this would be a lot of work."

Zhang Rujing really didn't know how to evaluate Boss Wang, after all, he was also a victim of the bubble economy. With the website's stock price plummeting, her heart must be bleeding too.

He couldn't very well discourage someone who was finding joy in hardship and sacrificing their own interests for the greater good.

So Dr. Zhang could only nod: "That makes a lot of sense."

Life is full of different aspects, and no matter which angle you look at it from, you can find a reason for it; it all depends on your perspective.

Wang Xiao was quite excited: "Bubbles can create miracles on the demand side. Through free services and huge subsidies—yes, burning money—it's possible to cultivate users' consumption habits in a very short time. I can bet you that in less than ten years, online shopping will become a consumption habit for many people. Things that normal market evolution cannot achieve, bubble capital can cultivate quickly in a short period of time."

Considering that Mr. Wang runs an online shopping website, Dr. Zhang believes he should endorse his boss's optimism.

Moreover, while online shopping may not be as convenient as buying things directly from a convenience store, it still has its advantages.

For example, he can buy Taiwanese products in Shanghai, including items he's used to using in the US. It might take a little longer, but it's better than flying there specifically for this, and the cost is much lower.

So Dr. Zhang nodded in affirmation: "I won't bet with you, I think you're right."

Wang Xiao was deflated. What kind of bet is this? So uncooperative!

Jiang Shangzhou couldn't help but chuckle. Dr. Zhang was known for his frugality; don't even think about him paying for anything that wasn't absolutely necessary.

He sighed: "But the damage that the bubble economy did to society was just too great."

There are currently two opposing voices in the tech stock market: one is calling for a bubble, while the other is emphasizing that it's just normal market volatility and there's no need to worry too much.

In short, the bubble doesn't seem to have truly burst yet, so people can't see the serious consequences for the time being.

But Jiang Shangzhou thought of the bursting of Japan's economic bubble in the early 1990s, the serious consequences of which continue to this day and have not been recovered at all.

Even the Southeast Asian financial crisis of 1997 was, in fact, closely related to the sustained economic weakness caused by the bursting of Japan's economic bubble.

Vast amounts of capital and talent are ultimately wasted, investors lose everything, and practitioners suffer career setbacks. From the perspective of overall social well-being, this waste represents a tremendous loss.

Wang Xiao nodded in agreement.

She visited Japan in the early 1990s and witnessed the fall of the Thai baht in the summer of 1997.

The collapse of the bubble was as devastating as war. She witnessed more than one suicide.

However, it is also an effective mechanism under the market system that can most quickly break through technological critical points, build new infrastructure, and complete the updating of the whole society's understanding.

This is not about right or wrong, but rather a brutal dynamic about innovation, capital, and human greed.

Jiang Shangzhou tried to discuss with Wang Xiao: "Mr. Wang, do you think the government should play a greater role in this?"

If he asked his colleagues in the government about this topic, the answer would definitely be yes.

Strong government oversight is essential.

If he were to ask an ordinary businessman, the answer would certainly be no.

One of his old classmates had already gone into business. Over drinks, the classmate told him something heartfelt: "For businesses, the best government is one that doesn't exist, so no one will meddle."

In a market economy, the government shouldn't be constantly interfering like a mother-in-law. Isn't that annoying?

However, both of these views are too extreme, and he would rather listen to Mr. Wang's opinion.

Because she moves between the political and business worlds, she is a businesswoman and she also understands politics, so she should be able to see issues more comprehensively.

Before we knew it, everyone had entered the prefabricated house that served as a temporary office.

The doors and windows were open for ventilation, and the electric fan was blowing loudly, so even though the sun was shining brightly outside, the room was not like a steamer. Moreover, there was a bowl of plum juice on the table, which gave off a refreshing sweet and sour aroma.

Wang Xiao had already quite consciously scooped up some plum juice and drunk it. One sip and it felt incredibly refreshing.

She smiled happily, her eyes crinkling: "Of course we have to manage it, otherwise the efficiency will be too low, and the capital won't know which way to go."

Before she traveled through time, she could clearly see the government's involvement in both new energy and artificial intelligence; otherwise, such rapid development would have been impossible.

Even with the current internet economy, isn't the US government busy with all sorts of things?

A completely market-driven economy, even if everyone is talking about neoliberal economics, is impossible.

Otherwise, what is the meaning of the existence of a nation?

Jiang Shangzhou felt comforted after hearing her words, and then asked, "So what do you think is the most appropriate level of government intervention? Hey, Zhang Bo, you should also share your thoughts."

Zhang Rujing waved his hand: "How can I explain this clearly? I don't understand."

Even now, he believes that he is not good at dealing with the government.

In Shanghai, Jiang Shangzhou was basically responsible for this part of the work.

In Xiaozhou, these mobile chip factories have their own dedicated personnel in charge.

So the problem ultimately comes back to Wang Xiao.

The latter took another sip of plum juice, smiled and shook his head: "I don't know, this balance has always been difficult to grasp."

If you tighten your grip, the market will be strangled, everyone will be suffocating, and they'll want to run away.

But if you loosen your grip, haha, then the government can expect thousands upon thousands of scammers.

Scamming government subsidies is a skill that has been mastered throughout history and across the world. Which government can honestly say it hasn't been ripped off?

What's most infuriating is that once the subsidies stop, everything is wiped out.

The excitement that had just unfolded seemed to vanish in an instant, like a pipe dream.

The site's logistics manager brought over a plate of cherries. They weren't the big kind, but rather small, locally grown cherries, which had a unique flavor.

Jiang Shangzhou also ate one and sighed, "This is indeed a troublesome matter."

Confucius said: "Women and petty men are the most difficult to deal with. If you get too close to them, they will become disrespectful; if you keep them at a distance, they will resent you."

In fact, it's the same for men and women, and the same goes for the market; being too distant or too close, too lenient or too strict, won't work.

Wang Xiao picked up a small cherry, put it in her mouth, and laughed, "That's why leaders are the wisest people."

Her intention was to flatter him, but Deputy Director Jiang caught her off guard and teased, "Hmm, I can see that. Mr. Ivanov is the wisest man, otherwise he wouldn't have been able to find such a capable wife as you."

Zhang Rujing chuckled beside him.

Wang Xiao could only rub his nose, realizing he'd gotten himself into this mess. "Serves you right for being so quick-tongued!"

Jiang Shangzhou also laughed, but Mr. Ivanov is the Deputy Prime Minister of Russia, a national political figure, and it's not appropriate to discuss him in private.

Otherwise, given their ages, they would both be more inclined to inquire about Mr. Wang's personal life.

Amidst the laughter, Xiao Gao's voice came from outside: "Alright, go hand out the flyers on the street! Why are you here at the construction site? Hurry up and leave, don't get hurt."

This was followed by a rebuttal: "We're not here to post ads, we're here to advertise for you."

Wang Xiao didn't want to get involved in her own gossip, so she curiously ran to the door and looked outside to see what kind of advertisement was being advertised.

Wow! This is something new; it's the first time she's ever heard someone want to advertise for her.

Wuzhou has its own advertising company, so it's more likely to attract orders from outside.

Under a willow tree not far from the prefabricated houses, two young men in short-sleeved T-shirts, judging by their attire, were promoting their properties to Xiao Gao, who was stopping people. They were spitting as they spoke: "Look, your construction site has already started, so the houses will definitely be available for pre-sale. Now, we'll advertise for you online, so everyone can come and buy a house quickly, and your funds can be recovered faster."

Hearing what was happening outside, Zhang Rujing and Jiang Shangzhou exchanged glances and instinctively stood up to go and see what was going on.

Advertising them online? That's really strange.

Xiao Gao was both amused and exasperated: "On which website are you planning to advertise for us?"

"Aiwang, the hottest Aiwang on all universities right now." The bespectacled male college student couldn't wait to start introducing it. "All college students are active on Aiwang, including those who are about to graduate. Think about it, after graduation, everyone needs to settle down, right? They definitely need to buy a house, right? If they see your real estate project's advertisement on Aiwang, they will definitely choose your property first."

Jiang Shangzhou glanced at Zhang Rujing subconsciously and asked in a low voice, "What kind of website is Aiwang?"

He had heard of Sina, Sohu, Amazon, Yahoo, eBay, and so on, but this was the first time he had ever heard of Aiwang.

What is this website for?

Wang Xiao craned his neck to watch the excitement and casually replied, "It's I-Net. They're probably from the university's student union, out soliciting advertisements."

Jiang Shangzhou knew about the university's student union.

Jiang Shangzhou was aware that the student union was responsible for attracting advertising.

The university is full of active young people with lively minds. All kinds of club activities are emerging one after another, and they often come up with a large-scale project for the whole university.

These activities all cost money, and what if the school doesn't have enough funds to apply for sponsorships? Well, they definitely have to go out and solicit sponsorships.

However, Jiang Shangzhou learned that the sponsors he sought were generally restaurants, cafes, small shops, or shopping malls near universities—in short, places where university students might go to spend their money.

This was the first time he had ever heard of a university club soliciting sponsorships by advertising online, and even trying to get people to buy houses.

You need to have a house to buy.

Xiao Gao immediately refused, saying, "You've misunderstood. This isn't a real estate project; we're not building houses to sell, so we don't need your advertising."

However, college students are the most persistent group, unwilling to give up easily, and still asking, "So what are you doing here?"

Xiao Gao was exasperated: "Build a factory, build a chip factory, you know? We won't sell it. Alright, alright, you guys should hurry up and leave. It's so hot outside, don't just stand there baking in the sun."

To the bodyguard's surprise, the college student insisted on trying again: "You'll need to hire people when you build your factory, right? We'll advertise for you, and all the elites will come. You'll definitely recruit top talent."

Xiao Gao was practically suffocating. What kind of people were these? They were like leeches.

The assistant, who was watching from the side, couldn't help but laugh and tried to smooth things over: "Our factory will take two years to build. If you advertise now, everyone will have forgotten about it in two years. Okay, you should look for other companies."

The two college students were skeptical, but the other party wouldn't listen to reason, so they had no choice but to leave, sweating profusely.

Even Boss Wang couldn't stand it anymore, so he had his assistant give each of them a cup of plum juice to cool them down.

Jiang Shangzhou still doesn't understand: "How come college students are advertising on your website?"

This advertising platform is a website, so how can college students use it?

Wang Xiao picked up another cherry and casually replied, "They're like our salespeople. College students need advertising and a platform, so we provide that platform for them. After securing sponsorship, they create their own ads, mainly in Flash and graphic formats, and then upload them to the ad space. After the website reviews them, they publish them. The website and they split the sponsorship 50/50."

She laughed and said, "We also need to make a living, otherwise, if INet doesn't turn a profit and we have to spend money to maintain the website, we really can't afford it."

Jiang Shangzhou was dumbfounded. My God, the internet economy is so hot today, there are countless business models.

But this was the first time he had ever heard of turning users into his own advertising salespeople.

If you don't pay a single penny of salary, then those who work will have their own pockets to pay for it.

————————!!————————

Historically, Jiang Shangzhou was diagnosed with lung cancer in 2001. He underwent surgery and chemotherapy, but his condition worsened in 2011, and he passed away at Ruijin Hospital in Shanghai at the age of 64.

The novel discovers the illness earlier, so there's a happy ending. [hugs]