History and Hero


CAI Lei, founding partner of JD Capital, incumbent chairman of JD Capital. This article is excerpted and revised from his speech at the mid-term plenary meeting held in July 2014.

I would like to start with the World Cup.

We have witnessed a global football carnival since the last month, and tonight the finals will come. I am into playing football and also a deeply entrenched fan. My interest in watching the World Cup dates back to 1982 when the champion was Italy and the most renowned football star was Paolo Rossi, the golden child. Since then, I have become a true fan for the Italian team and European team. History has a significant impact on me.

I guess many of you present were yet to be born in 1982, right? But there is nothing worth boasting. For one who watches football match as early as 1982, to put it nicely he is seasoned, but badly he is old. However, getting old is the law of nature, which is independent of man’s will and everyone has to face.

I have watched a great many of World Cups and I dare to say this World Cup is the most dramatic one. For example, in the first round of the group game, Spain, the reigning world champion in recent years, was humiliated by a 1-5 loss. And Brazil, the host as well as the likely winner of this World Cup, got a loss of 1 to 7 at home. Who would have guessed that? There is another match in which the Netherlands nominated a substitute goalkeeper to stop the penalty in the last minute and won.

I have watched the World Cup for years but never met such a dramatic one, and you?

This World Cup is dramatic, but when the match comes to this phase, there is no suspense about the final result. The Top Eight are constituted of the respective top team of the eight groups. When it comes to the Top Four phase, the aggregate score of the top four teams hits the highest in history. The two competing teams tonight are the best performing ones in the six matches and finally will meet each other in the finals. Though the World Cup is seemingly dramatic, the result is in no doubt.

In fact, this is the feature of history. The participants and observers of the event may think it was dramatic, but the result has been predetermined in history.

Today’s exchange starts from the World Cup, and the theme is History and Hero.

I. The Driving Forces for the Historical Evolution

Let’s have a review of the history. I like reading history, and also have some views on it. Though history is too dramatic to be predicted, it has its own law and underlying dynamics that drive its development. Then what are the driving forces for the historical evolution over the thousands of years?

The No.1 Driving Force: Scientification 

Scientification means that human beings use their scientific knowledge to learn, explain and change the world. It constitutes significant contribution to the thousands of years of human history, especially the contemporary human history. Scientification is the largest driving force for the evolution of human history. 

Then what is science? Opposite to theology, science is a scientific knowledge system accumulated and derived through strict logical reasoning on the basis of objective observation, experiment, and trial and error. Science is rationalism while theology is mysticism. Theology, which comes from human imagination, supposes that there is an omnipotent God in the outer world and takes God’s language as the standard to explain the world. Actually, history itself is created by science rather than God. 

But we should also know that science is relative. What are scientific today may no longer be scientific decades later. Science develops by way of repeated self-denial.

The future space for scientification is huge. An answer or even a partial answer to any of the questions related to life, universe, material structures or the essence of consciousness, etc. will create a new history. Up till now, the function of science in promoting history is beyond measure. 

The No.2 Driving Force: Secularization

What is secularization? We may have seldom heard of it, but it is closely linked with us. Everybody has material and spiritual needs. Such matters as food, clothing, shelter and transportation; beer and skittles; life, death and sickness have to be taken into account. The driving force that satisfies those human needs is secularization. The wave of exploring and satisfying the various secular needs of human beings constitutes another force driving the evolution of human history and civilization.

In the course of human development, de-secularization has appeared as well, i.e., religionization and sanctification. Europe was under the rule of religions throughout the Middle Ages, which is an example of de-secularization. As science could not explain the outer world and the production of physical goods failed to satisfy human needs, religions then managed the society by depressing or eliminating needs. It is not hard to discover that the fundamental feature of all religions, whether it is Christianity, Buddhism or Islam, is to depress needs.  

In the lasting struggle between secularization and religionization, the former finally defeated the latter. The rich and colorful world is the product of the full secularization of human society.

In the largest sense, scientification improved the output efficiency and resolved the supply problem. And secularization resolved the demand problem, which resulted in a growing increase of human demands so that the output can be consumed. The two historical wheels pushed human beings forward.

But over-secularization has also brought human beings into a predicament, or even a disaster as demand always exceeds supply. Human beings to a great extent cannot do without religion, which can depress material desires.

The No.3 Driving Force:Marketization

Why did market appear? In the course of human development, the key problem of how to allocate resources has always haunted them. If we say that scientification and secularization are two wheels pushing the world forward as they solved the problem of supply and demand in the human society, then another vehicle is in need to balance the two wheels so that history can proceed by steady steps. After thousands of years of exploring and developing, human beings found out a tool, that is, market.

What is market?Market is a distribution system of social resources on the basis of the division of labor, exchange, currency and price. Marketization can be regarded as capitalization and commercialization, etc. The development stage of market includes mercantilism, industrialization, the gilded age, and financial capital.

Marketization has also brought a problem, that is, economic cycle, which goes together with market. Supply and demand, adjustment of which always lags behind the signal of price, cannot be highly accurate or completely synchronize with market change, thus resulting in periodical economic fluctuation. With the globalization of communication, such fluctuation leads prosperity to alternate with depression on a world scale. Despite the periodical crisis and disaster, the capability of market in allocating resources is without doubt.

Competitiveness is the intrinsic nature of market. With the continuous development of marketization, another unpleasant situation appeared: the wealth is increasingly concentrated in the hands of the few, and the gap between the rich and the poor is great. The original marketization and capitalization on a large scale enable capital to employ or even enslave labor, which has intensified the competition and confrontation among people, brought social contradictions and conflicts and resulted in a variety of world miseries. In this context, the communist theory and its experiments, calling for market and capital abolition, as well as extensive movements and revolutions have become a theme of the recent one or two hundred years, which ultimately led to a new slavery. The social experiments on communist turn out to be wrong afterwards. At the same time, the market system is continuously corrected and optimized by Keynesianism, state capitalism and welfarism. 

Market may not be the best, but there is no other better choice. Since the Second World War, the entire world has been incorporated into the market system. The formulation of the global financial system in particular established the dominant position of market. Although a few countries do not practice market economy, they cannot get rid of its influence since they are not isolated from the world.

Almost all the problems faced with human beings today can find explanations in market and the knowledge on it, i.e. economics, and that is the origination of the saying “Economic Imperialism”. Most contemporary social problems are related with economic problems or even rooted in them. Different from natural sciences and humanities, economics is very young, with a history of merely one to two hundred years. With economics becoming more scientific, many realistic problems of human beings are expected to be resolved.

The No.4 Driving Force:Informationization

It is easy to understand informationization as the human society has already been highly informationized. The futurist Alvin Toffler wrote a well-known book in the 1980s – The Third Wave, in which the human history falls into three waves – the waves of agricultural revolution, industrial revolution and information revolution. According to him, we now are in the phase of information revolution.   

In my opinion, the wave of informationization has always accompanied human history and pushed it forward. Informationization refers to the process of, through a symbolic system, exchanging, using and continuing all sorts of human cultures, including material wealth and spiritual wealth. Language, character, education and book exemplified informationization in the old times. Fish and wild goose, which were used to convey love letters, as well as beacon-fire, which was used to give border alarm in ancient China, both symbolize informationization. Every innovation and advance of information tools brought about a profound social reform.

Why was China able to lead the world one to two thousand years ago? The unification of characters, and the tradition of respecting teachers and valuating education are two important reasons. China is the initial nation that valued informationization. It is the inventor of papermaking technology and hundreds of years ahead of other countries in movable typography. And thanks to these techniques, the Chinese culture could be spread worldwide in a low-cost way, which made it advanced in an earlier time. Other countries were far behind in this regard.

The modern informationization further facilitates information exchange and improves the efficiency of information transfer and use by means of newspaper, radio, broadcast, television, phone, and cellphone. And the latest informationization, which was symbolized by Internet, mobile Internet, and the Internet of Things, etc. is familiar to us as for its effects on and the changes it has brought to human society.

What will informationization bring to us? I am not sure yet. Philosophically, information belongs to the category of consciousness, which is opposite to material, but it cannot do without human activity and material foundation. However, with the development of big data, the Internet of Things, artificial intelligence, and super computer, information exchange independent of human society may also happen. As for the situation in the future, we cannot predict and master yet. The struggle between human beings and robots presented in the film The Teminator may also be possible. The influence brought by informationization may be even larger than the above driving forces as it will totally change human history and the world.

The No.5 Driving Force: Globalization

Globalization can be understood from two respects. One is the tangible globalization, namely the globalization in the material dimension. Human beings have to make continuous efforts to conquer new worlds due to a scarcity of resources. Once out of Africa, and across oceans,they have left their footprints all over the planet. In addition, they have set foot on the moon and plan to land on Mars in 2030. The other one is the globalization in the spiritual dimension, that is, a thirst for knowledge and subjugation that impels human beings to make continuous efforts to explore the unknown world. Globalization in this sense has greater influence on human beings. As early as millions of years ago, our ancestors realized an ancient globalization by traveling on foot and consanguinity transmission. After the last ice age, the racial propagation on a world scale was accomplished.

The first real globalization manifested as the Silk Road, the Age of Exploration in Europe, and the Great Geographical Discovery, etc. At the beginning, China participated in it, but quitted later, which resulted in the country’s long-term “historical backwardness”. Around 1500, Spain and Portugal, two small countries in Iberian Peninsula, took the lead in opening the early maritime civilization. Officiated by pope, the two countries signed the renowned “the Treaty of Tordesillas”, which divide the world into two parts with the meridian line as a boundary. The part west to the boundary belonged to Spain and the other part Portugal. In contrast, China was in the Ming Dynasty, when it boasted itself as the world No.1, and the emperor indulged himself in wishful thinking in the Forbidden City. China, in a manner of speaking, has fallen behind Europe in idea and structure, and its later backwardness has become a historical necessity.

Globalization at present is easy to understand. Everybody may have read The World is Flat by Thomas Friedman. As the world has become a global village, Japan and Korea also suffer the smog from China. The UN, NGOs, and multinational corporations are the pushing force as well as byproducts of globalization. The World Cup embodies this phenomenon as well, for example, the finals, which is between Argentineans and Germans, influences the Chinese audiences’ emotions as well.  

Globalization will continue in the future, and territory to be conquered will not be restricted to earth, the solar system, and the Galaxy, but extend to the whole world, the universe and the mental world at large. The connotation of “the World Cup” can further expand. Space colonization, star war and multiverse, the very thinking of them makes us excited.

The above five driving forces can be summed up as one word, that is, modernization. Human progress, to summarize from the thousands of years of history, is benefited from scientification, secularization, marketization, informationization and globalization. To judge whether a country or a nation is modern, these five indicators are enough.

This is my understanding of history.

II. Chinese History in a Broader View 

I would like to explain Chinese history from a broader view, that is, the psychodynamic view of history. From that point, Chinese history is brief, only covering four stages.

The first stage is the period of the early Qin Dynasty. At this stage, China basically synchronized with other countries as they all got through the processes of ignorance, enlightenment and founding.

The second stage is from B.C. 221, when the Qin Dynasty united the nation, to A.D. 1279, when the Song Dynasty collapsed. This period is the golden age in Chinese history. The establishment of a united nation and the leading role of Confucianism since the Qin Dynasty have made the Chinese civilization a world initiative. Despite the ups and downs in some dynasties, the Chinese culture has always held a leading position in the world and reached a peak in the Tang and Song Dynasty. Over the 1,000 years, China has led the world in scientification, secularization, informationization and globalization, and the Chinese civilization led the world therefore.

The third stage ranges from the end of the Song Dynasty to 1978 when the Reform and Opening up was going to be launched. The mainstream of the 700-year history started from a long-term stagnation in the internal-oriented and closed agricultural society, then turned to the national salvation triggered by the Opium War and the Sino-Japanese War of 1894-1895, and finally came to the lasting and repeated revolution for way out in the recent hundreds of years. China got outdated and backward step by step, and the history at that period was heartbreaking. I would like to give you an example. The No.1 driving force for history was scientification, but in this respect, what China could take as an honor was the so-called “Four Great Inventions”, the last invention of which, i.e. the movable typography technology, was invented in the North Song Dynasty but after that, China has had no scientific and technological achievement. There is no doubt for China’s backwardness.

The fourth stage starts from 1978 or the newest stage of Chinese history. Marked by the Reform and Opening up, the Chinese history reintegrated into the world tide. In other words, the above five driving forces that push the world forward have become the social mainstream of China. In the view of macro-history, the position of 1978 as a historical turning point will become more prominent in future China. 

Let’s look at the China since 1978 with the same psychodynamic view of history. Instead of going into more detail about it, I would like to use some slogans and catchwords to make a brief description. As for scientification, the most famous slogan was “Science and technology are the primary productive forces”; for secularization, the most famous one was “It doesn’t matter whether the cat is black or white, as long as it catches mice”, “Time is money”, and “To get rich is glorious”, etc.; for marketization, we can review the sayings from the commodity economy to the socialist market economy; for informationization and globalization, propaganda is unnecessary as the working method is here to see. From the propagandas in the recent and contemporary history such as “Everybody is responsible for his country”, “To expel the northern barbarians and to revive Zhonghua”, “To take class struggle as the core of communist ideology”, we can see the great social changes in China over the 30 years.

In this sense, people present here as well as our parents and offspring should be the luckiest Chinese over the seven and eight hundred years. China reintegrated into the world and re-controlled its destiny. We are the luckiest Chinese over the hundreds of years either in starting a business or working on other undertakings.

This is my understanding of history. Next, I would like to talk about the important subjects on China’s economy in the next decade, as they are directly related to the undertakings of JD Capital as an investment institution and asset management agency, and to all of you present.

The first one is the market reform, especially the financial reform and the state-owned enterprise reform, which are greatly associated with us. The fundamental power for those reforms is marketization. Financial reform is concerned with thousands of billions of Yuan and the state-owned enterprises reform 30 to 40 trillion Yuan. This is an extremely grand stage. 

The second one is mergers and acquisitions. The fundamental power is related to marketization, informationization, and globalization. China has already moved into the era of mergers and acquisitions. Ameriaca has experienced five waves of mergers over the 100 years, from horizontal, vertical, mixed, and leveraged ones to strategic reorganization. I predict that in the next ten years, the five waves of mergers will appear in China simultaneously. It is the second super historical stage.

The third one is digital economy. The fundamental power for it is informationization. A book named Digital Survival predicts that we cannot live without information, digit, and network in the future. Network and informatioanization have completely changed individuals and institutions in the states of existence, organization mode and operation method. This is also one of the most important subjects in the next ten years.

III. History and Hero

“The current of the ever-flowing Yangtze River has swept away heroes …”, “Heroes were blown away by wind and rain…” these verses are very familiar to us. What does the role human beings play in the long history? Whether it is the hero that creates the history or the history that creates the hero?

The times produce their heroes.

Let’s come back to the World Cup. I have no idea who gave this miraculous name to it. Though it is just a football match, we can see the world and interpret the relations between history and hero through the “cup”

In my opinion, history is a World Cup, where dramas are presented continuously. The process and result of the World Cup, we may say, represents the most prominent features of human history: it is dramatic as the result is difficult to predict; ever-victorious general does not exist, and teams take turns to be the champion; there is no lack of stars and there are always heroes who decide the result in critical points; it absorbs enough attention and a great number of fans; there must be winners and losers, and countless people cheer or shed tears over its result. These features are possessed by history as well. 

As for the role of heroes in the history, it bears a close analogy to that of the football stars in the stage of the World Cup. When it comes to the World Cup, the most talked about topics for fans are the stars admired by tens of thousands of fans and the classical matches they led, say, Maradona, Baggio, Zidane … Without these great stars, what can the World Cup leave in the memory of fans? It would seem to have no difference with common matches. But was the history of the World Cup created by football stars?

Without Germany's Thomas Muller and Argentina’s Lionel Messi, the Germany team and Argentina team cannot get to where they are today. But without the overall strength contributed by a group of world leading football players, advanced technique and tactics, couch’s excellent command and in-game adjustment ability, good logistical service, or stars with outstanding skills, can they win games one after another till reaching the finals and winning the championship? The role of stars is critical, but not decisive. We can predict that a team composed of 11 Messi may not conquer the Chinese team today.

For a football player, or even a current football star, how can he become a great star winning the World Cup? That is to say how can he become a historical hero?

The answer is simple. First of all, he should enter the World Cup finals. There were a great number of football stars that could not get through the preliminaries, and they would never have a chance to win the World Cup. Talents are not rare for the world, but many of them failed the preliminaries and faded into history.

Secondly, joining a powerful team. You have to rely on an organization, and join a team that can give stars enough support. Messi would end up with nothing if he has joined the Chinese team.

Lastly come the capability and luck of the player. Entering finals and being in a good team are premises for great World Cup stars; likewise era and organization will create historical heroes.

It was due to the sifting of the 100 years of revolution that the Communist Party of China and chairman Mao grew; it was due to China’s reintegration into the world and the highly informationization of the society that Alibaba, Huawei, Ma Yun and Ren Zhengfei appeared; it was due to the mass securitization in the recent years that JD Capital was founded. The hero of each age is created by the age as history produces heroes. Stars can only be seen in a clear night; dragons can only be found in vast rivers. The role of an individual is minute in front of the age. 

Meanwhile, we can see that the existence of the so-called stars is more and more ephemeral and their influence is weaker and weaker. They are as illuminating as stars but as short as summer flowers. Why? That is because the progress of history grows faster.

As the theme of the times keeps changing, so does the hero of the times.

History cannot do without hero.

Ruan Ji, one of the seven sages of the bamboo grove in the Eastern Jin Dynasty (317-420),is a great talent and very famous, but he does not want to become a government official,so he, together with a group of other talents, indulged themselves in nature and lived an unconventionally and unrestrainedly life. Once he lamented at the sight of the old battlefield of the war between Liu Bang and Xiang Yu in the Chu-Han period that, “There is no hero in the world, so that even punks can become famous”, the direct meaning of which is that there was nothing great about Liu Bang or Xiang Yu, who were only two outlaws of the marshes, but as there was no hero, they became famous. Of course, he might be describing himself. In the turbulent days of the late Eastern Jin Dynasty (317-420), people were mediocre, and those with great capability were few, which contributed to his reputation and made him a star.

Then are heroes in the history as incompetent as Ruan’s comment? Is their success only attributed to coincidence and luck?

According to Ruan’s thinking, history can be taken as a rigorous and ruthless kick-out match and a filter. Every day kick-out matches are played on the arena of history. Competitions and selections repeat day in and day out among individuals, organizations, nationalities, and states. Only the fittest survive, but the ultimate successor will be selected out.

Buffet once commented on the winners in the investment field, saying that though the competition in the investment field is cruel, it is no more than a coin toss among two hundred million participants held in America. There are two competitors in every round, and the one who makes a right guess wins. After ten to twenty rounds, there must be a batch of winners. Though the winners are picked out from over two hundred million people, those who are lucky enough can walk to the final. And there must be a batch of lucky dogs at last. The victory and success of those men may be a total coincidence. There is nothing like the skill of tossing coin, and things would be the same even competing with a gorilla. Buffet was giving his respects to Ruan Ji who lived over one thousand years ago.

However, the best investor ever would certainly not pick up others’ idea. Buffet continued to say that although the winners of one or more times of games are among the luckiest dogs, according to his observation, most of the lucky dogs come from a community, i.e. the Graham and Doddsville Club. That is to say they are a group of people that take the value invest idea invented by Graham as criterion. There are regular patterns to recognize long-term successful investors.

History is also like this. On the surface, when there is no hero, punks can even become famous. But those punks who become heroes must have their own specialties.

Then what are the specialties? Heroes themselves represent their own times, so a true hero gives full expression of features of the times: social mood, spirit of the times, and conflicts among organizations.

We have learned physics in the secondary school and certainly know resonance. We may use this concept to explain heroes in the history. Let us suppose there is a big data analytics, the analysis would be that some specialties of a hero, whether created by physiological factors or spiritual factors, must be in harmony with the features of the times and his organization. If the times and organization forms a frequency, then this frequency and that of the hero are highly consistent with each other and will resonate. If the times and organization is a melody,the melody of the hero must be the theme of the former, so the two can highly resonate. Such a thing cannot happen on a non-hero.

History is decided by above-mentioned underlying driving forces for a tendency, but heroes will speed up the progress of history at the very moment by way of resonance, which is the specialty of them. In my view, history cannot do without heroes. If Argentina were to take the crown tonight, Messi would play the critical role. Eventually, the critical victory or defeat depends largely on heroes who can create historical legends deserving of praises and tears.

History produces its own heroes, and history cannot do without heroes. This is my understanding of the relations between history and heroes.

IV. JD Capital and Its Staff in the History

The Return of the King and the Coming of Heroes in Large Numbers

In the past seven to eight hundred years, China was isolated from the world and till 1978 it has begun to reintegrate into the world. Once as the leader of the world tendency,China have a fair chance of returning to the top of the world and becoming the elder brother of the world after hundreds of years of loss. It is the historical background confronting JD Capital and our staff. I call this grand historical background “the return of the king”.

China is very different from the past as the era is highly diversified. Thousands of years ago, the Chinese history was led by statesmen and strategists or writers and artists, because China was a country emphasizing politics and culture. It has paid little attention to scientific spirit and economy. But now it is a total different story. Heroes appear in every profession, politics, economics, science and technology, culture and art and so on. Hero is hero,and it has little to do with his background and choice. Heroes from various professions will appear in front of us. I call this historical phenomenon “the coming of heroes in large numbers”.

JD Capital and the Historical Choice of Its Staff

In this context, what historical mission or historical destiny do JD Capital and its staff face?

The most prominent background and demand for China are to rejuvenate and rise, which is comparable to the rise of America 100 years ago. The First World War around 100 years ago established America’s world dominance. But before this war, America had already been the world uncrowned king. Its rise depends on its strong economy, thanks to which, America had been the world economic leader several decades before the War. The symbols of America’s economy are two names. One is Ford and the other is Morgan. They are the name of people: Henry Ford, the first generation of industrialist, and JP Morgan,the first generation of financier; and also the name of enterprises: Ford Motor, the most successful industrial enterprises, and Morgan Bank, the most successful financial enterprises. America has its own unique culture, advanced science and technology and outstanding military forces, but I think the most important foundation for its rise are its industry and finance. The industry and finance of America ranked first in the world, because 100 years ago it already boasted a number of industrialists and enterprises like Ford and Rockefeller as well as a number of financers and financial institutions like Morgan.  

China’s reinvigoration cannot realize without economic foundation. But how is the economic foundation established? We need industrial capital, Huawei, Tencent, and Lenovo perhaps; and also need financial capital, maybe ZTE, Ping An Insurance, Fosun and JD Capital.

We can have a guess of the future candidate of financial capital. According to the coin toss theory of Buffet, there must be some lucky dogs that can become China’s Morgan and Goldman and become the world’s financial hero. But what specialties should these lucky dogs possess? I think the following specialties are definite.

Firstly, it must be an institution owned by Chinese. Only Chinese men can lead China’s reinvigoration, and Americans definitely cannot.

Secondly, it must be a youthful institution and managed by youth. Youth here is concerned with physiological age and psychological age as well,or more precisely it refers to institutions with aspirations, enterprises and initiatives.

Thirdly, it must be a competent institution. Hard work is more favored than empty talk. Hard work asks for competence. What is the kind of competence? An essential indicator is that the controller and manager of large capital have at least hundreds of billions Yuan, whether the money is owned capital or management capital, as he cannot accomplish great things without such a size.

Now it seems that after years of development, especially the upgrade and evolution this year, JD Capital has settled some basic conditions. In the financial capital coin toss in China, JD Capital and its staff will certainly become one of the above candidates. We have a fair chance to enter the final competitions, and become the true financial capital and capitalist that boost China’s reinvigoration. 

These are the historical mission and destiny of Jiuing and its staff. Under the motivation of historical trend, has a fair chance of standing out, and heroes from the organization of JD Capital will also come forth in large numbers. JD Capital must give birth to a multitude of heroes from generation to generation and only in this way can it help Chinese nation realize its reinvigoration through capital.


I would like to apply two quotes to end today’s talk. These two quotes are from two Chinese revolutionists in the recent century, who are also two true heroes of that age. 

One is Sun Yat-sen, who said,“The general trend of the world is exceedingly great, and those who submit will prosper, while those who resist shall perish”. I think he has made the basic law of historical development clear. History has its own evolution logic and we have to master the trend and adapt to the trend.

The other one is Mao Zedong, who said, “For truly great men, look to this age alone”,and this is the right heroic conception of history that deserves our support. Each era has its great men and everyone gets a chance.

This is my understanding of history and hero. I would like to share with you and hope it will be of any help for your work and career.

Thank you!