National Tide 1980.

Monday, August 1987, 10.

At ten o'clock in the morning, the largest conference room at the LVMH headquarters was packed with people. Bernard Arnault held a press conference here as the helmsman of LVMH.

On this day, he made a series of clarification announcements to several French mainstream media outlets specifically in response to the recent rumors and the controversy caused by Henri Lacamier's deliberate defamation of the company's products at the fall press conference.

For example, everything is going smoothly within LVMH's internal operations. Except for Henri Racamier, who is dissatisfied with the company's absorption of new blood, jealous of talented people and puts many obstacles in the company's management, the other board members are as harmonious and united as before.

Then he pulled all the board members together, and without Henri Lacamier being present, announced that the board had collectively voted to "ban" Henri Lacamier.

In addition, Bernard Arnault also announced in advance that the company's operating performance in the third quarter of this year will be greatly improved and will not disappoint investors.

The entire meeting went smoothly and successfully, with too many reporters holding microphones and competing to ask questions.

However, Bernard Arnault did not give reporters too much time. He only spent about ten minutes answering five or six questions, then put his hands behind his back and announced the end of today's press conference.

Escorted by several staff members, he maintained a gentlemanly smile and walked leisurely to the door of the conference room.

He was the first to leave the venue and went straight to his office.

Along the way, he nodded to almost all the subordinates he met, politely responded to greetings from others, and conscientiously played the role of a confident corporate leader.

Only when he returned to his office, closed the door and was alone did the smile on his face disappear.

At this moment, he let go of all his restraint and seemed like a completely different person. He called Lazard Investment Bank in an extremely impatient manner.

If any of the reporters had seen him like this, it would undoubtedly make all his remarks at the meeting no longer credible.

The reason why he lost his composure was nothing else but that the market value of LVMH and Dior Clothing had been falling in the past few days.

In other words, his wealth is continuing to shrink.

Although it was only a paper loss, it didn't take long for this incident to make him heartbroken.

"How is it? How is it? Frank, this is Bernard. How is the market situation now?"

As soon as he heard Frank Mayer's voice on the microphone, Bernard Arnault asked impatiently.

Unfortunately, Frank Mayer on the phone did not provide Bernard Arnault with any good news. "It's still not good, my friend. After the market opened today, both LVMH and Dior continued to fall. Including last week, this is the third consecutive day. And today's selling pressure has also increased slightly. Fortunately, the decline is not too severe. LVMH's stock price has only fallen by less than 2%, and Dior's stock price has fallen by 3% today..."

The bad news immediately made Bernard Arnault furious.

"Isn't that enough? Do you mean to say that everything I have done in the past few days is useless? I am acting according to the plan we recently discussed. The idea was given to me by you. In order to reverse the bad influence and save the public's confidence in LVMH, I even spent millions of francs to entertain the editors-in-chief of three French newspapers, the head of a radio station, and the producer of a TV news program on a yacht to attend a model party. But now I have spent the money, and the news in return has been published. But you told me that it still can't stop the stock price from falling. And even Dior clothing has fallen. Can you tell me what is going on? And now, besides informing me that my wealth is shrinking rapidly, what else can you, an investment expert, do for me?"

"Don't be anxious, don't be anxious. I understand your feelings very well, my friend. But what can you do if you vent your anger on me? The problem now is that you have unknowingly fallen into the trap of your opponent. You have become someone else's prey now, do you understand?"

Frank Meyer patiently comforted the other party, and what he said was definitely not an attempt to shirk responsibility or to exaggerate.

"I am now very sure that someone is deliberately shorting your company. And I have found out that the person shorting your company should be your old rival. Through special channels, I tracked down the business department and account information that sold these stocks. The selling orders all came from the fifth district business department of Lyon Securities. In addition to Henry Lacamier's account, there is another one named Pierre Cardon, and another one seems to be an Asian, but I can't remember his name. Anyway, they came here with great momentum and are rich. It seems that they have raised a lot of funds and borrowed a lot of securities to short sell."

However, his explanation was almost ineffective. After hearing these words, Bernard Arnault became even more excited and almost shouted into the microphone.

"So what? Even if these people come together against me, so what? They are just defeated by me, and they are totally overestimating themselves. Why don't they think about the fact that they haven't defeated me in the past year, so how can they defeat me today? Otherwise, LVMH is not under my control now. Well, I originally wanted to let the old madman Henri Lacamier live a rich second half of his life. Since he still won't give up and wants to ruin my business, I will no longer be merciful. And that Pierre Cardin, an old man who makes mass-produced ready-to-wear clothes and only sells goods under his own brand, dares to look down on me. Compared with me, he is the one without taste. Frank, I'm really angry, you have to help me make those who dare to go against me lose everything."

"Of course I'm on your side, but I have to advise you to control your anger and act rationally. The situation is a bit complicated right now."

Frank Meyer considered himself a relatively objective bystander. He didn't care at all whether Bernard's self-esteem could bear it or not, and insisted on speaking out the issue that he was most worried about.

"The issue of public opinion is very difficult to deal with. Yes, you did what I said and launched crisis public relations in a timely manner, but how can you have as many friends as Henri Racamier in the fashion industry? He has been in the industry for many years and is much more famous than you. Most people think he is an expert, so they will inevitably stand on his side and criticize you for kicking him out of the board of directors. There is nothing you can do about it. Just like Pierre Bergé, the general manager of Yves Saint Laurent, who laughed at you for being an outsider in the fashion industry on every occasion last weekend. You know, he has always been jealous of the fact that your Dior clothing can be launched ahead of Saint Laurent, so he now tells everyone he meets that LV's glory is all because of Henri Racamier. You have excluded this expert, and sooner or later both LVMH and Dior clothing will be finished."

"This Pierre Bergé has gone crazy! I'll remember him! Frank, I swear, I'm going to make sure Yves Saint Laurent is not on the market!"

Bernard Arnault no longer cares how many enemies he has. He has added another name to his revenge list.

Frank did not comment on this.
"That's for the future. For now, we still have to focus on the most urgent issues at hand. Listen, friend, I don't care how angry you are, but you must take it seriously. They came prepared. Perhaps they have Henry inside LVMH, and they must have seen that LVMH's current management conflicts and equity struggles have caused the company's value to be seriously out of touch with the fundamentals. They would deliberately create a bad influence at this time, and use the media to repeatedly criticize and start short selling. Although your M&A strategy is very successful, as long as the equity is firmly in your hands, they are unlikely to regain control of the company from you even if they suddenly attack. But now it seems that as long as they no longer linger on this and are determined to sell their chips, they should all make money. They can make some money as compensation and disgust you at the same time, which may be their plan."

"And I'm not trying to scare you. I feel like they've gotten smarter and have discovered another weakness of yours - Dior Clothing. Unlike before, they're now attacking the two companies you control at the same time. This will not only make it difficult for us to tell their strengths from their weaknesses, but will also cause us to waste a lot of unnecessary funds and be unable to take care of ourselves. I'm not even sure yet whether they've realized that controlling Dior is equivalent to getting 6% of LVMH's shares. So we have to be careful, otherwise they'll probably find an opportunity to take advantage of us. If they really turn the tables and snatch LVMH from you, we'll become a well-known joke in the investment community."

Bernard Arnault finally listened to these words.

Because his core interest lies in the control of LVMH, he is like a dragon guarding a treasure, full of the highest level of vigilance when it comes to equity. He did not express his anger this time, but remained silent for a while, lowered his voice and spoke solemnly.

"They wishful thinking. I won't let them get their wish. Let's discuss now what to do next. Now it seems that 200 million US dollars is not enough. If I want to defeat them, I need more money. Can you raise it for me as soon as possible?"

However, when it comes to this, Frank Meyer evades the question for the first time.

"No, no, no, it's not that simple. I've said it before. Lazard has invested too much money in you. If you count the two hundred million, we have invested no less than one billion dollars in you. Putting all your eggs in one basket is a taboo in investment. I can't give you more. If that happens, I won't be able to explain to the headquarters, and the United States will have trouble with me. And I suspect that the Asian is probably a Japanese. Considering the Japanese's current style of doing things that they have too much money to spend, I'm worried that they may have four or five hundred million dollars, or even more. So no matter what? We need reinforcements to support us financially."

"What reinforcements? What do you mean?"

"What I mean is that in order to be 100% sure, I can contact other investment banks to be our allies. For example, JPMorgan Chase and Lehman Brothers. With the shares of LVMH and Dior Clothing and the credit rating of our Lazard Bank as endorsement, we can raise enough money from these investment banks. Whether it is another billion or two billion, it will be no problem. No matter how rich those outsiders are, they are just outsiders and don't know the secrets of the financial industry. Few people know that our investment banks rely on credit to borrow funds from each other, which is almost equivalent to unlimited chips. How about it? As long as you are willing to pay more interest, I can handle this for you. I will definitely help you use funds to bypass them. As the opponent, we have to redeem them at a high price if we want to defeat them, and we will lose all our money."

They are all thousand-year-old foxes, so they naturally understand everything in Strange Stories from a Chinese Studio.

Although Frank came up with a good idea, Bernard Arnault, who understood the subtext, immediately scolded, "You Jew, are you trying to blackmail me again at this time? I really doubt whether you understand the meaning of friendship? You always have to negotiate with me. Are you trying to get some benefits as a broker? I really regret the watches, golf clubs and good wines I gave you on weekdays. It seems like a complete waste now."

Frank responded shamelessly, "Don't say that, you are tarnishing our friendship. You know it best in your heart. I am the friend who can really help you. Haven't I used my expertise to handle many troubles for you that are not worth your precious energy to think about? The service I provide you is not something that ordinary VIP customers can enjoy. Don't be so stingy. Who doesn't think about themselves in this world?"

Money makes the world go round, and an emperor has no need for hungry soldiers. Foreigners also understand this truth. Bernard Arnault is also a man with a vision. After thinking about it, he decided to focus on the big things and let go of the small ones.

"Well, Frank, I have to say that you are still my teacher when it comes to profiteering. But I like your idea and the last sentence. Forget it, as long as I win, I don't care about spending a little more money. I agree, and there will be an extra benefit for you. Shouldn't you be satisfied with this?"

As expected, money can make everything. Knowing that he could earn extra money, Frank Meyer's mood improved immediately.

"Oh, that's great, Bernard, I knew you would understand. Generous people are destined to achieve great things."

Of course, because of this, he will naturally be more responsible in dealing with the current situation.

"Oh, by the way, before we get reinforcements, the 200 million dollars we promised you can be in place first. It's a bit difficult to protect two stocks with this money, but it's no problem to protect one stock. I want to ask you, which stock do you want to protect most urgently? You'd better choose one, and we will support it first. I will hurry up to deal with other things, and try to help you get the funds by the end of today's trading..."

"I choose Dior. Please help me keep Dior first. Your reminder is necessary. Maybe they really want to control LVMH shares by raiding my Dior. I have to guard against this. We won't take this risk."

"Okay, I'll do it right away. Wait for my call." After saying that, Frank Meyer hung up the phone.

It was only at this time that Bernard Arnault had some time to relax mentally and emotionally.

He dialed the phone on the desk and asked the secretary outside to order a cup of coffee with a double shot of whiskey.

He had to admit that after this conference call, he felt much more at ease.

Although Frank was greedy, he had never let him down in the field of finance and in handling financial matters. He was sure that this guy could do what he said and his money would not be wasted.

By the time we had lunch, the situation had improved a lot.

Because Frank called his office and said that he had spent 100 million to protect the stock price of Dior Clothing, and the decline had stopped and the stock price had risen by 2%.

We have already had preliminary communications with JPMorgan Chase regarding credit financing. We will get $200 million after 3 p.m. today, and another $300 million in the next three days.

After hearing the good news, Bernard Arnault has basically begun to imagine how he will use financial weapons to teach his opponents a lesson once again and knock out their teeth.

Humph, these fools who can only make clothes and are also laymen when it comes to finance, actually want to fight him with their bodies?
I don't even know what happened until I die.

So, even in the afternoon, when someone from Guinness called and asked about the recent sharp drop in LVMH's share price and the damage to LVMH's reputation, Bernard Arnault responded quite toughly.

He assured Guinness that all was well, that the share price would soon return to where it should be, and that any instability on the board and in management would be swept out like trash.

However, he was still too optimistic.

Because of the time difference between the United States and Europe, when it reached 2:30 in the afternoon, the Stock Exchange on Wall Street in the United States also opened.

And the stock market crash that was destined to attract worldwide attention and shock the world arrived at the precise time.

It didn't take long before the three major U.S. stock indexes suddenly collapsed.

The traders were all stunned, holding their heads and staring at the straight-down curve, dumbfounded. (End of this chapter)