Political Posts

[Sweet]

1 hour ago, Luca said:

Just look at Alibaba/Tencent. Huge buyback programs and 3x the buyback size of MAG 7 while shareprice flat for 10 years. I think its pretty obvious which stock will perform better from here...

I don’t think it’s obvious.  An investment in China is to invest alongside the CCP and whatever way the political wind is blowing.  Although it’s unlikely you also cannot rule out measures like being unable to get your money out of China.  Not to mention the huge amounts of innovation from the top US tech companies that nobody can compare to.

[Luke]

44 minutes ago, Sweet said:

I don’t think it’s obvious.  An investment in China is to invest alongside the CCP and whatever way the political wind is blowing.  

An investment in China is an investment alongside the people of China and their Government. 

 

An investment in the US is an investment alongside the people of the US and their Government. 

 

Both are the same thing so whats important is to understand how do the people and the government see your business? 

 

If you study CCP releases, Xis speeches, what public officials say, all lights are on green. Nobody wants to take your business away, nobody wants communism and a Stalinist economy, China will remain a partly private partly public economy just like other economies in the west. 

 

What is different is that china can regulate the bad parts in their markets and will do so, same should be true for the US but I don't know whats going on inside congress and their plans against mag 7. 

 

Alibaba will remain a private business for the coming decades and nothing will change in that regard with a 98% probability. 

44 minutes ago, Sweet said:

Although it’s unlikely you also cannot rule out measures like being unable to get your money out of China.  Not to mention the huge amounts of innovation from the top US tech companies that nobody can compare to.

30% of the worlds manufacturing and industry is in China, ALL incentives are there to cooperate with China and not increase confrontations. If there is war, its over and I will probably be sent to fight in WW3 too so my portfolio will become irrelevant. If you think its thinkable that the same happens with China what happened with Russia then you are wrong, those are two completely different economies, the effect of China cut off would be 20x worse and lead to a hard depression for 5-10 years and global growth will probably stagnate for way way longer, I can afford to lose 25% of my PF in that case. 

 

Innovation in China is not to be underestimated, we already see how far they are and Tencent/Alibaba can easily compete with US tech. 

 

 

 

 

Edited April 10, 2024 by Luca

[Luke]

If you think the odds of a china cut off are so high @Sweet, then you need to reposition your portfolio way different than just buying "good companies at reasonable prices", because those will get fucked when China leaves. So if you are so short China and long war, then you cant be long QARP stocks at the same time. 

[Luke]

Owning military stocks is the best play here probably if you think it will escalate in the next 5 years. With that you will outperform everyone. 

[Sweet]

1 hour ago, Luca said:

An investment in China is an investment alongside the people of China and their Government. 

 

An investment in the US is an investment alongside the people of the US and their Government. 

 

Both are the same thing so whats important is to understand how do the people and the government see your business? 

 

 

That’s a generalisation, there are differences in the two systems and those matter in practice.

 

The US has separation of powers and a restraining constitution.  The US President doesn’t have the power of Xi, can be blocked by courts or Congress, and the balance of power in both houses of Congress can be changed every two years through elections.

 

You note that “china can regulate the bad parts in their markets and will do so”.  Yes they are so effective at that because power is concentrated but that cuts both ways.

 

Say a Chinese president decides he doesn’t like a particular company, goes on another anti-corruption drive, sours in capitalism, or prohibits capital from leaving the country.  What is there to restrain him?

 

Investing in China comes with that risk and that risk is why I don’t invest in China.

 

Edited April 10, 2024 by Sweet
Comment vanished

[Luke]

https://www.scmp.com/news/hong-kong/education/article/3258541/hong-kong-universities-rise-newly-published-global-subject-rankings-driven-positive-employer?module=top_story&pgtype=homepage

• More than 50 per cent of subjects offered moved up the rankings in a newly published global league by Britain-based education information firm Quacquarelli Symonds
• City’s four public universities included in league table for data science and artificial intelligence programmes, with Hong Kong University of Science and Technology in top 10

[hillfronter83]

1 hour ago, Luca said:

An investment in China is an investment alongside the people of China and their Government. 

 

An investment in the US is an investment alongside the people of the US and their Government. 

 

Both are the same thing so whats important is to understand how do the people and the government see your business? 

 

If you study CCP releases, Xis speeches, what public officials say, all lights are on green. Nobody wants to take your business away, nobody wants communism and a Stalinist economy, China will remain a partly private partly public economy just like other economies in the west. 

 

What is different is that china can regulate the bad parts in their markets and will do so, same should be true for the US but I don't know whats going on inside congress and their plans against mag 7. 

 

Alibaba will remain a private business for the coming decades and nothing will change in that regard with a 98% probability. 

30% of the worlds manufacturing and industry is in China, ALL incentives are there to cooperate with China and not increase confrontations. If there is war, its over and I will probably be sent to fight in WW3 too so my portfolio will become irrelevant. If you think its thinkable that the same happens with China what happened with Russia then you are wrong, those are two completely different economies, the effect of China cut off would be 20x worse and lead to a hard depression for 5-10 years and global growth will probably stagnate for way way longer, I can afford to lose 25% of my PF in that case. 

 

Innovation in China is not to be underestimated, we already see how far they are and Tencent/Alibaba can easily compete with US tech. 

 

 

 

 

The big difference is that the interests of Chinese government and its people are not aligned. Chinese people (shareholders) get a much smaller piece of its GDP.

 

Here is a good thread for understanding the fundamental issue with Chinese economy. And here is the link to the original article in Chinese.

http://m.xugaoecon.net/nd.jsp?id=16

 

 

 

[Sweet]

@hillfronter83 my comment disappeared by I agree.  They really aren’t the same.  Separation of powers in the US is an important difference.

[Luke]

33 minutes ago, hillfronter83 said:

The big difference is that the interests of Chinese government and its people are not aligned. Chinese people (shareholders) get a much smaller piece of its GDP.

 

Here is a good thread for understanding the fundamental issue with Chinese economy. And here is the link to the original article in Chinese.

http://m.xugaoecon.net/nd.jsp?id=16

 

 

 

 

I disagree, if you look at what Li Qian recently said, its exactly these talking points. They are aware of the problem and obviously working on it. So many people make China look like its this "nothing can change its over" economy while they regularly publish writings that tackle all of the critical points...its a very dynamic economy as you can see by the past 20 years of success. 

 

Your article says: 

 

Xu highlights the profoundly obstructed channel of income transfer from the corporate to the household sector as the primary reason behind this distinctive consumption pattern. The extensive presence of state-owned enterprises (SOEs) in China, whose profits and dividends primarily flow to the state rather than households, diminishes the wealth effect that might otherwise stimulate household consumption. Nor is the highly concentrated ownership of many Chinese private enterprises doing much to increase the wealth or consumption of the wider population.

 

I don't see why people working at SOEs couldn't get an income increase ordered by the government which will boost consumption. They did the same at JD where wages was forced up, which is smart. 

 

Privately owned enterprise need to pay their workers more so consumption increases, the CCP already regulates it quite heavily: 

 

https://www.reuters.com/technology/jdcom-cut-senior-executives-salaries-by-10-20-2022-11-22/

 

Ironically THATS then seen as "BAD" by the market. While they do exactly what is good for the overall economy. 

 

 

Furthermore, Xu points to the absence of an efficient market mechanism (again, a result of the disconnect between the corporate and household sectors) to balance the distribution of national income between consumption and investment. This shortfall means the household sector is unable to influence corporate dividend policies, resulting in excessive corporate savings and overinvestment.

 

What they are trying to say is that consumers are too weak and corporations don't want to reinvest because they lack demand. Time for enterprises to increase wages...if they don't the CCP will do its job and regulate the economy. 

 

 

[Luke]

30 minutes ago, Sweet said:

@hillfronter83 my comment disappeared by I agree.  They really aren’t the same.  Separation of powers in the US is an important difference.

I cant believe that you are convinced of "separation of powers" within the US. Reality is that the US is completely dominated by business interests and the pendulum is way reversed compared to china. Yes, that's good for shareholders but the US consumer isn't looking particularly bright either where 45% earn below 29k USD a month and concentrated markets with lacking competition will bring their own ills to an economy over time. 

[Luke]

43 minutes ago, hillfronter83 said:

The big difference is that the interests of Chinese government and its people are not aligned. Chinese people (shareholders) get a much smaller piece of its GDP.

 

Here is a good thread for understanding the fundamental issue with Chinese economy. And here is the link to the original article in Chinese.

http://m.xugaoecon.net/nd.jsp?id=16

 

 

 

 

This economist has a point and Xi starts a common prosperity program-->Market--> CHINA BAD

[Sweet]

34 minutes ago, Luca said:

I cant believe that you are convinced of "separation of powers" within the US. Reality is that the US is completely dominated by business interests and the pendulum is way reversed compared to china. Yes, that's good for shareholders but the US consumer isn't looking particularly bright either where 45% earn below 29k USD a month and concentrated markets with lacking competition will bring their own ills to an economy over time. 

Disagree.  Sorry Luca.  I can’t understand how you are unable to see what are clear differences.

[Luke]

41 minutes ago, Sweet said:

Disagree.  Sorry Luca.  I can’t understand how you are unable to see what are clear differences.

 I did tell you exactly what the differences are. Shareholders are place number 1 in the US, understood? Thats a clear difference I pointed out. But I also told you that that doesn't necessarily mean good things for the overall economy, people's well-being, achieving a higher level of civilization, etc. 70% of people in the US are overweight or obese. But nobody regulates or does anything. There are many more examples of this. 

 

 

Edited April 10, 2024 by Luca

[Luke]

How many hours do US teens spend on their phone everyday watching junk reels, playing games etc? If you look at some statistics, its horrific how many hours it is. But China is the bad guy to regulate that and their technology companies? 

How many people in the US are underpaid and work 2 Jobs to survive? Why is China the bad guy for common prosperity? 

The price hikes in food, other consumer products etc are also one example of too concentrated markets and too little competition, why do i have to pay 20 dollars for a junk burger meal? Why do i need to pay too much for cars when china now makes them better, cheaper and is even willing to send them to my front porch? But they are not allowed to do that...i wonder why that is...

 

[Luke]

So how will the economy look like who regulates the bad things and how will the economy look like who doesn't? The picture is plain in sight, 70% of people overweight or obese, teens spending 5-8 hours on their phone everyday, 20% of adults diagnosed with depression in their lifetime, 10% with depression within a year, one in six people on psychiatric drugs for what reason? Because US is the greatest place on earth and everybody does better than all other countries? How many people come on top due to other drug abuse? Alcohol? 

 

But yes, we need way more free markets because that will do what? 

[Luke]

It is no surprise to me that real problems in the US but also the west are overlooked and instead we are focussing on fake problems like all these transrights, women rights whatever rights which do what? Will we be happier when finally trans people can work 80 hours a week or 1 out of 1m transpeople plays a role in a disney movie? 

 

Its a fake public debate, a false flag operation to divert peoples attentions from real problems which nobody wants to solve. At least the SP 500 is at 5200 basis points...and 0.1% can go to an ivy league school while the rest either has to go in debt for private schools or live with the low quality public schools...the majority of Americans is NOT doing well. 

 

And China is the problem...and always bet on America! 

 

Long China honestly. 

[Luke]

And also dont get me wrong, i dont hate the US. I think the US can be a GREAT place and has SO much to like. Culturally, nature, many great people too, great history, very advanced economy, etc. But China is discounted so much and you can find problems in both countries. US tech is also very strong but also very expensive. Munger is right, we can all do well, Chinese, and US...and we should have a lot of free trade together...

[Malmqky]

5 minutes ago, Luca said:

And also dont get me wrong, i dont hate the US. I think the US can be a GREAT place and has SO much to like. Culturally, nature, many great people too, great history, very advanced economy, etc. But China is discounted so much and you can find problems in both countries. US tech is also very strong but also very expensive. Munger is right, we can all do well, Chinese, and US...and we should have a lot of free trade together...

If you don’t mind me asking, what is your nationality? Are you Chinese by chance? Or are you Eastern European/Asian? American? 
 

I ask because nationality plays a large role in this. If you ask a Chinese person what they think of Japan, you’ll get a negative answer. Or ask someone from the Middle East what they think of America. Another negative answer. Or god forbid, ask a Palestinian what they think of Israel.
 

I think it’s hard to be objective about other countries, especially if you haven’t lived in them. I can tell you the pros and cons of America, but China I can only tell you what I’ve learned through media and secondhand stuff from my Chinese friends.

 

For what it’s worth, I think America is trending towards a pseudo-oligarchy while China is heading towards authoritarianism/is already there. Lots of negatives for both countries, as well as obvious pros.

[Sweet]

25 minutes ago, Luca said:

 I did tell you exactly what the differences are. Shareholders are place number 1 in the US, understood? Thats a clear difference I pointed out. But I also told you that that doesn't necessarily mean good things for the overall economy, people's well-being, achieving a higher level of civilization, etc. 70% of people in the US are overweight or obese. But nobody regulates or does anything. There are many more examples of this. 

 

 

Yes that’s a difference but not the main one, it’s the differences in the system that are most important which I described in my post earlier.  You claimed an investment in China and US stocks are ‘both are the same thing’.  It’s not in my view.  The US system is inherently less risky for investors.

[Sweet]

2 minutes ago, Malmqky said:

If you don’t mind me asking, what is your nationality? Are you Chinese by chance? Or are you Eastern European/Asian? American? 
 

I ask because nationality plays a large role in this. If you ask a Chinese person what they think of Japan, you’ll get a negative answer. Or ask someone from the Middle East what they think of America. Another negative answer. Or god forbid, ask a Palestinian what they think of Israel.
 

I think it’s hard to be objective about other countries, especially if you haven’t lived in them. I can tell you the pros and cons of America, but China I can only tell you what I’ve learned through media and secondhand stuff from my Chinese friends.

 

For what it’s worth, I think America is trending towards a pseudo-oligarchy while China is heading towards authoritarianism/is already there. Lots of negatives for both countries, as well as obvious pros.

 

I could be wrong, but I think Luca is Chinese but living in Europe.

[ValueArb]

On 4/9/2024 at 6:14 AM, cubsfan said:

^^^^ Then you understand the tradeoff - although you might not agree. Americans want a sealed border - period - and in exchange - Ukraine gets more assistance. Perfectly reasonable and settled with political tradeoffs as any democracy would. Both sides win. This past proposal was never a serious attempt to seal the border.

 

It turns out Americans don't like being lab rats for the Left's open border experiment. Now that they accomplished their goal of 10M+ new residents - the citizens have had enough of the destruction.

 

I don't want a sealed border. I want an immigration policy that helps our sagging birth rates by allowing in a few million hard working and talented new citizen candidates every year, and provides them with legal visas to wipe out the black markets that are the cause of so much crime and misery. 

 

I've had enough of the disaster caused by border militarization. When I was a boy migrant workers kept their families in their mexican villages and only spent half the year in the US to bring that money back home and live well. Most never wanted to uproot their families, but we made transiting the border far more difficult so migrant workers started bringing their families in to the US to move here permanently.

 

Just give migrants work visas every year as long as they stay out of trouble, cooperate with US authorities, and return home for at least 6 months a year and problem solved. 

 

[Luke]

20 minutes ago, Malmqky said:

If you don’t mind me asking, what is your nationality? Are you Chinese by chance? Or are you Eastern European/Asian? American? 
 

I ask because nationality plays a large role in this. If you ask a Chinese person what they think of Japan, you’ll get a negative answer. Or ask someone from the Middle East what they think of America. Another negative answer. Or god forbid, ask a Palestinian what they think of Israel.
 

I think it’s hard to be objective about other countries, especially if you haven’t lived in them. I can tell you the pros and cons of America, but China I can only tell you what I’ve learned through media and secondhand stuff from my Chinese friends.

 

For what it’s worth, I think America is trending towards a pseudo-oligarchy while China is heading towards authoritarianism/is already there. Lots of negatives for both countries, as well as obvious pros.

I am coming from the cosmopolitan country Germany haha! 

 

I'd say I can look with reasonable neutrality to both the US and China from this place. 

 

 

[Luke]

22 minutes ago, Sweet said:

Yes that’s a difference but not the main one, it’s the differences in the system that are most important which I described in my post earlier.  You claimed an investment in China and US stocks are ‘both are the same thing’.  It’s not in my view.  The US system is inherently less risky for investors.

That is nothing new, we all know that and I said Shareholders are No.1 in the US. I still think you wont get fked over as Munger said. 

Edited April 10, 2024 by Luca

[Luke]

24 minutes ago, Sweet said:

I could be wrong, but I think Luca is Chinese but living in Europe.

Lol! I am 100% european, family coming from northern Germany, also great grandparents etc. no family history in China/Asia

Edited April 10, 2024 by Luca

[Sweet]

9 minutes ago, Luca said:

That is nothing new, we all know that and I said Shareholders are No.1 in the US. I still think you wont get fked over as Munger said. 

Munger’s investment is BABA is one I could never understand as it seemed entirely at odds with his philosophy on life.

 

Apologies for mis-ID’ing you.  Thought you were Chinese.

 

Edited April 10, 2024 by Sweet