Alibaba

https://www.cnbc.com/2021/08/17/china-te...slide.html

Quote:China seeks to tighten rules on unfair internet competition, sending tech shares lower

Here are some of the other key rules outlined:
*Operators should not provide false data, such as the number of clicks on a piece of content;

*Operators should not conceal negative reviews and only promote positive reviews;

*Internet platforms should not use data, algorithms and other technical means to influence user choices, or other methods to carry out so-called traffic hijacking. This is where a company looks to redirect a user to their own website or service while they’re browsing another;

*Operators should not use data and algorithms to collect and analyze competitors’ trading information.

*SAMR said it could hire third-party institutions to audit data if an operator falls foul of the rules.

https://www.bloomberg.com/news/articles/...-crackdown.

Quote:Gensler Warns of Chinese Company Risks After SEC Crackdown

Gensler also repeated a demand that U.S. officials must be allowed to inspect Chinese firms’ financial audits. The U.S. passed a law in December requiring Chinese companies to allow American officials to review financial information or be delisted.

“If the auditors of Chinese operating companies don’t open up their books and records in the next three years, the companies -- Cayman or Chinese -- won’t be able to be listed here in the U.S.,” said Gensler, referring to the Cayman Islands where many shell companies associated with the firms are based.

https://www.msn.com/en-xl/money/other/te...uxbndlbing

"Temasek's 13F filing on Monday listed investments in at least 13 Chinese companies. Among the biggest bets, the wealth fund trimmed its stake in Alibaba Group Holding, the owner of this newspaper, for a second straight quarter."

Either Temasek thinks Ali growth has slowed or there r better opportunities.

Reminds me of something I saw earlier today on Twitter (original source unclear).

Personally I think it's better to make your own analysis and decisions, and not follow anyone in/out of any position.

Peace.

(vested small)

China is beginning to show how a centrally planned economy works. It has no hesitation to destroy capitalist opportunities if it deems it affects the quality of life of citizens.

The government has targetted high housing and education cost and the tuition episode shows how it does not care about the profits of a billion dollar industry. Other industries are beginning to see this with china controlling how data is used in consumerism. While many have lauded how China acts similar to Singapore, this month's worth of regulation shows this is further than the truth. China is not acting as a capitalist, it has a communist ideology through and through.

Post this episode, when investing in China, the government has become a major factor. No matter how good a business is, if his profits is based on manipulating human nature like how stores sells candies near the checkout counter; china is going to come after you

Delivering economic growth is the CCP's only reason for existence. Without which, its popular support to rule the country will be no more, and CCP will be finished.

Without a strong economy, China will also find it much harder to exert global/regional influence. And China certainly does not want to be cornered by its neighbours and/or Western nations.

Future growth of Chinese companies will continue to be driven by tech adoption to improve efficiency and productivity. Imagine the inefficiencies on merchants if there were no alipay or wechatpay, or if there were no taobao/alibaba to facilitate domestic consumption and export trade.

Because of the scale of its e-commerce infrastructure, baba is a 'tax collector' on retail spending in China. And e-commerce spending (in both volume and unit price) in China will only grow. Its per capita income is still a fraction of developed nation like US or SG.

But how high or low this tax income may be depends on how tough the regulators are. 

Of all the 'distressed Chinese tech,' I think baba has the lowest probability of being 'killed.'

(17-08-2021, 07:36 PM)CY09 Wrote: China is beginning to show how a centrally planned economy works. It has no hesitation to destroy capitalist opportunities if it deems it affects the quality of life of citizens.

The government has targetted high housing and education cost and the tuition episode shows how it does not care about the profits of a billion dollar industry. Other industries are beginning to see this with china controlling how data is used in consumerism. While many have lauded how China acts similar to Singapore, this month's worth of regulation shows this is further than the truth. China is not acting as a capitalist, it has a communist ideology through and through.

Post this episode, when investing in China, the government has become a major factor. No matter how good a business is, if his profits is based on manipulating human nature like how stores sells candies near the checkout counter; china is going to come after you

Yes. It increasingly appears that it requires a different kind of skillset to invest in Chinese companies, the ability to second guess the government's intent accurately.

(17-08-2021, 07:36 PM)CY09 Wrote: China is beginning to show how a centrally planned economy works. It has no hesitation to destroy capitalist opportunities if it deems it affects the quality of life of citizens.

The government has targetted high housing and education cost and the tuition episode shows how it does not care about the profits of a billion dollar industry. Other industries are beginning to see this with china controlling how data is used in consumerism. While many have lauded how China acts similar to Singapore, this month's worth of regulation shows this is further than the truth. China is not acting as a capitalist, it has a communist ideology through and through.

Post this episode, when investing in China, the government has become a major factor. No matter how good a business is, if his profits is based on manipulating human nature like how stores sells candies near the checkout counter; china is going to come after you

I feel that much media commentary frame / insinuate / cast aspersion on the recent actions of the China government as acts that are against free market principles and thus ultimately must be wrong and would result in economic pain.

I however see the recent actions by China government in a positive light - these are actions to reduce the excesses of the free market. After all, free-market vs control-market are just two ends of a continuous spectrum. And the excesses of a very-free-market can be very excessive, and the rough edges very rough. 

Not sure about China but I recall seeing posters of tutors in Hong Kong as if they were idols. And all the ads encouraging one to spend to beef up your game character's powers on YouTube. I feel surely these should be curbed.

So from an investor viewpoint, I regard the recent actions, impacts and fallouts as transient and not critical to long-term value.

I thought Xi is doing a fine job. The biggest risk to investor I feel is whether his successor can continue to rule China in a stable manner. The U.S. political system has its controls to withstand a poor President but the China system (and maybe other countries in Asia) bets too much on having a ethical and wise leader.

(17-08-2021, 11:25 PM)Choon Wrote:

(17-08-2021, 07:36 PM)CY09 Wrote: China is beginning to show how a centrally planned economy works. It has no hesitation to destroy capitalist opportunities if it deems it affects the quality of life of citizens.

The government has targetted high housing and education cost and the tuition episode shows how it does not care about the profits of a billion dollar industry. Other industries are beginning to see this with china controlling how data is used in consumerism. While many have lauded how China acts similar to Singapore, this month's worth of regulation shows this is further than the truth. China is not acting as a capitalist, it has a communist ideology through and through.

Post this episode, when investing in China, the government has become a major factor. No matter how good a business is, if his profits is based on manipulating human nature like how stores sells candies near the checkout counter; china is going to come after you

I feel that much media commentary frame / insinuate / cast aspersion on the recent actions of the China government as acts that are against free market principles and thus ultimately must be wrong and would result in economic pain.

I however see the recent actions by China government in a positive light - these are actions to reduce the excesses of the free market. After all, free-market vs control-market are just two ends of a continuous spectrum. And the excesses of a very-free-market can be very excessive, and the rough edges very rough. 

Not sure about China but I recall seeing posters of tutors in Hong Kong as if they were idols. And all the ads encouraging one to spend to beef up your game character's powers on YouTube. I feel surely these should be curbed.

So from an investor viewpoint, I regard the recent actions, impacts and fallouts as transient and not critical to long-term value.

I thought Xi is doing a fine job. The biggest risk to investor I feel is whether his successor can continue to rule China in a stable manner. The U.S. political system has its controls to withstand a poor President but the China system (and maybe other countries in Asia) bets too much on having a ethical and wise leader.

As long as a business contributes value to society, stays relevant to society changing needs, I thought there is nothing to fear in respect of China government recent actions.

And contributing value to society should have been an important (if not the most important) criteria for any long-term value investment.

(17-08-2021, 11:25 PM)Choon Wrote: I feel that much media commentary frame / insinuate / cast aspersion on the recent actions of the China government as acts that are against free market principles and thus ultimately must be wrong and would result in economic pain.

I however see the recent actions by China government in a positive light - these are actions to reduce the excesses of the free market. After all, free-market vs control-market are just two ends of a continuous spectrum. And the excesses of a very-free-market can be very excessive, and the rough edges very rough. 

Not sure about China but I recall seeing posters of tutors in Hong Kong as if they were idols. And all the ads encouraging one to spend to beef up your game character's powers on YouTube. I feel surely these should be curbed.

So from an investor viewpoint, I regard the recent actions, impacts and fallouts as transient and not critical to long-term value.

I thought Xi is doing a fine job. The biggest risk to investor I feel is whether his successor can continue to rule China in a stable manner. The U.S. political system has its controls to withstand a poor President but the China system (and maybe other countries in Asia) bets too much on having a ethical and wise leader.

1. Not sure if true. Although I agree that current measures seems to be in good faith (hence, I'm still vested), the risk here is whether this could escalate further into uncharted territories (e.g. cost-of-services regulation of "platform" companies ala utilities). I think this worst case scenario, is what most market participants fear.

2. Not sure if you can call current financial and geopolitical outlook entirely "stable". There is a good case to be make that the global image of China is at it's lowest point in recent years.

https://www.bloomberg.com/news/articles/...detentions

Quote:Negative Views of China Harden in Canada on Arbitrary Detentions
Public opinion of China is becoming entrenched at a record low in Canada, with Beijing’s use of arbitrary detention and treatment of its minority Muslim population resonating strongly in a new poll.