Gmthebeau Posted January 24 Posted January 24 5 minutes ago, Castanza said: That's not correct. OFAC is the main problem for US investors. Other countries have similar issues. More can be read about it on the Sberbank thread. I believe MSCI came out before the ban and said Russia was uninvestable and removed them from their indexes. I think people investing in China need to be aware if China fires off a rocket while the stock market is closed they may end up not being able to sell their China stocks either. In my opinion, it is just best to avoid countries that are not US allies. The entire China VIE structure basically means you don't own anything other than a piece of paper anyway.
Spekulatius Posted January 24 Posted January 24 (edited) 2 hours ago, John Hjorth said: This is actually true. It is one of many consequences of various sactions, not thought out well, designed and imposed properly, and according to purpose. Well, now back to China. Similar thing happened with my CHL holding. Trump already lost the election, yet Munchin somehow decided right after Christmas 2020 to ban US institutions and person from holding them causing forced selling. The ruling wasn’t even clear at that point, so the brokerages made their own rules because nobody knew what to do. This is the risk you are taking when owning shares from a country that is an adversity to the US. Just look at what happens in WW1 and WW2 with German business in the US. Schering Plough is an interesting history to read on that matter. @Castanza also bought the shares after the invasion to Ukraine deeply discounted, so it was a clear gamble which so far has not panned out. At least to me, it’s pretty clear that if you own Chinese shares and China attacks Taiwan, your shares are going to be very likely frozen for a long time. You can debate all you want what is right or not, but history has shown that in a war, your ownership rights to foreign assets are likely forfeited. Thats nothing new either, but has been true literally forever. Edited January 24 by Spekulatius
Castanza Posted January 24 Posted January 24 23 minutes ago, Spekulatius said: @Castanza also bought the shares after the invasion to Ukraine deeply discounted, so it was a clear gamble which so far has not panned out. That’s fine and I accept that risk. It’s just my opinion that the biggest risk to your foreign investment shouldn’t be your own govt.
Parsad Posted January 25 Posted January 25 11 hours ago, Castanza said: I also seem to remember Russia being a vital ally to the US during WWII....again...inconsistency regarding actions in both the historical and present perspectives. Because Russia was invaded! If anyone should know better, it should be Russia. Cheers!
Parsad Posted January 25 Posted January 25 10 hours ago, Castanza said: That was decades ago and although linked, it was different than the conflict in 2018-2020.... China broke the agreement to maintain the segregation of govt and laws in Hong Kong post handover from the British. CCP worked their way into Hong Kong through legislative annexation. They imprisoned protesters and advocates of democracy since the mid 2000's and additional change in 2018-19 basically removed all freedom or independence of Hong Kong. Simply a different approach. Many many changes - Freedom of press gone - Bogus elections with CCP stooges put in office - Extradition laws on the books and anti protest/democracy laws put in place to silence any dissident. Same thing China will likely do with Taiwan imo....China is damn good at invading through means of the nuanced legal process with no small degree of corruption. But Hong Kong was handed back to China...not invaded. They could do whatever they want with it after that and they did. Russia invaded Ukraine. I don't understand how you can't see the difference. Cheers!
Parsad Posted January 25 Posted January 25 9 hours ago, Castanza said: Then stop trying to managing my risk by blocking ADRs....Allow me to trade the ADR's I wish and if Russia decided to block my shares then that's my mistake and my risk. Same for China and any other country. Not sure how I can make this more clear for you lol Yeah, I have no problem with that. If you want to take the risk of investing in a foreign country fine. But if at the same time, that country invades another sovereign nation, and the world decides they are going to sanction that country by confiscating global assets, that is the political risk you are exposed to. Suck it up! You accepted that risk as well. Cheers!
Parsad Posted January 25 Posted January 25 7 hours ago, Castanza said: That’s fine and I accept that risk. It’s just my opinion that the biggest risk to your foreign investment shouldn’t be your own govt. What??!!! If you have offshore assets, the biggest tax collector is your own government. Risk is risk...doesn't matter whether if it is economic, political or anything else...nor who instigates the catalyst for that risk. Caveat emptor! Cheers!
Castanza Posted January 25 Posted January 25 11 hours ago, Parsad said: But Hong Kong was handed back to China...not invaded. They could do whatever they want with it after that and they did. Russia invaded Ukraine. I don't understand how you can't see the difference. Cheers! It's called a soft takeover. Different means to a similar end. Both are bad imo. One chose immense violence and the other chose corrupt legalese and political influence. The only reason Hong Kong didn't continue to get coverage was Covid started to take off. 11 hours ago, Parsad said: Yeah, I have no problem with that. If you want to take the risk of investing in a foreign country fine. But if at the same time, that country invades another sovereign nation, and the world decides they are going to sanction that country by confiscating global assets, that is the political risk you are exposed to. Suck it up! You accepted that risk as well. Cheers! 12 hours ago, Parsad said: Because Russia was invaded! If anyone should know better, it should be Russia. Cheers! 12 hours ago, Parsad said: What??!!! If you have offshore assets, the biggest tax collector is your own government. Risk is risk...doesn't matter whether if it is economic, political or anything else...nor who instigates the catalyst for that risk. Caveat emptor! Cheers! Again, you're missing my simple point by overcomplicating and going well beyond what I said.... I'm talking about ADRs and ADRs only. The fact is and supporting evidence shows, the biggest threat to YOU as an American retail investor owning ADRs of foreign companies is the US Govt blocking ownership or freezing assets. Main Point: Everyone was blaming Russia and China or saying they are the biggest threat to holding ADR shares. When in actuality so far the US govt has been the perpetrator. I'm not whining about it; I knew it was definitely a possibility when I bought the shares (hence the beer sized position). Frankly I expected it. This is also why I don't own Chinese equities even though some look dirt cheap.
dealraker Posted January 25 Posted January 25 12 hours ago, Parsad said: What??!!! If you have offshore assets, the biggest tax collector is your own government. Risk is risk...doesn't matter whether if it is economic, political or anything else...nor who instigates the catalyst for that risk. Caveat emptor! Cheers! Some forty years ago I began to acknowledge my own false bravado as a sustainable investment model. For me, as opposed to Parsad (who I both admire and support as to his view here), I'm unable to heavily overweight new positions as to my total investments particularly when it involves selling in a taxable account and paying massive tax. I did, and it largely came from processing Parsad's message to me, wipe out my retirement account and go to a more condensed portfolio. The outcome? Simply fantastic. But what I am getting to is I think overall the China game is false bravado. It is fine that Charlie Munger could go here, but few are like he was. One of my insights as to this is reading British/English history, particularly the Wars of the Roses era of absolute gyrating politics, the behavior of those taking sides and simply how fragile both beliefs and bravo was. One shout in the field during crisis and everybody ran...and I mean everybody. I got out of debt and the insurance business in 1994 and I pledged on my knees to my inner self never to do it again. "It" involved getting to know myself. After acknowledging to myself who I am? Amazing stuff came. Best with China is to know yourself most of all. Who are you and what are you going to do with all the mouthing, threats, and crazy beliefs surely coming as to it all. That said, I'll wager a boom upwards at some point too. Castanza too though has a valid point that the US jargon is in game too. That jargon is going to ratchet up intermittently even if those chanting are in business and making money there. Count on it. Life is great...if you can stand it!
Castanza Posted January 25 Posted January 25 7 hours ago, dealraker said: Some forty years ago I began to acknowledge my own false bravado as a sustainable investment model. For me, as opposed to Parsad (who I both admire and support as to his view here), I'm unable to heavily overweight new positions as to my total investments particularly when it involves selling in a taxable account and paying massive tax. I did, and it largely came from processing Parsad's message to me, wipe out my retirement account and go to a more condensed portfolio. The outcome? Simply fantastic. But what I am getting to is I think overall the China game is false bravado. It is fine that Charlie Munger could go here, but few are like he was. One of my insights as to this is reading British/English history, particularly the Wars of the Roses era of absolute gyrating politics, the behavior of those taking sides and simply how fragile both beliefs and bravo was. One shout in the field during crisis and everybody ran...and I mean everybody. I got out of debt and the insurance business in 1994 and I pledged on my knees to my inner self never to do it again. "It" involved getting to know myself. After acknowledging to myself who I am? Amazing stuff came. Best with China is to know yourself most of all. Who are you and what are you going to do with all the mouthing, threats, and crazy beliefs surely coming as to it all. That said, I'll wager a boom upwards at some point too. Castanza too though has a valid point that the US jargon is in game too. That jargon is going to ratchet up intermittently even if those chanting are in business and making money there. Count on it. Life is great...if you can stand it! Appreciate the perspective
Luke Posted January 25 Posted January 25 https://www.scmp.com/news/china/politics/article/3249786/chinas-communist-party-vows-take-new-and-old-challenges-peoples-daily-article-based-xi-jinpings?module=top_story&pgtype=homepage With the words of Xi: "Thursday’s article said the Chinese Communist Party must draw painful lessons from many other “large parties and parties with a long history” that had failed, but did not offer any specific examples. “They were once full of vigour and vitality, but some have fallen apart or disappeared, some have weakened and are approaching their end, while some are in deep trouble. These are very regrettable and thought provoking [lessons],” it said." Brian Wong, assistant professor of philosophy at the University of Hong Kong, cited Beijing’s tracking of communist powers around the world. Beijing had kept a watchful eye on events such as the decline and fall of the Soviet Union, the changes in Eastern Europe, and the “falling apart” of revolutionary parties, such as in Cambodia, Wong said. “On the other hand, Beijing also recognises that the socioeconomic inequalities giving rise to great instability in advanced liberal democracies point towards the need to redress these inequalities [in communist states] and [enforce] internal party discipline.” China’s Communist Party vows to take on ‘new and old challenges’ in People’s Daily article based on Xi Jinping’s speech
forest81 Posted January 26 Posted January 26 Does anyone know if/what Li Lu has regarding investments in China? The only portfolio I can see online is his US one. Does he have a China portfolio? I would have thought he would be loading up at these prices for some pretty amazing company's.
formthirteen Posted January 26 Posted January 26 (edited) 25 minutes ago, forest81 said: Does anyone know if/what Li Lu has regarding investments in China? The only portfolio I can see online is his US one. Does he have a China portfolio? I would have thought he would be loading up at these prices for some pretty amazing company's. https://di.hkex.com.hk/di/NSSrchPersonList.aspx?sa1=pl&scsd=27/01/2018&sced=27/01/2024&pn=li+lu&src=MAIN&lang=EN&g_lang=en Edited January 26 by formthirteen
Gmthebeau Posted January 27 Posted January 27 Interesting video from WSJ about China and their Taiwan ambitions. https://www.wsj.com/video/series/wsj-explains/a-secretive-chinese-force-is-becoming-the-us-militarys-biggest-challenge/B379CBEF-E14C-4501-833C-3E444F37C761
Parsad Posted January 27 Posted January 27 On 1/25/2024 at 6:01 AM, dealraker said: Some forty years ago I began to acknowledge my own false bravado as a sustainable investment model. For me, as opposed to Parsad (who I both admire and support as to his view here), I'm unable to heavily overweight new positions as to my total investments particularly when it involves selling in a taxable account and paying massive tax. I did, and it largely came from processing Parsad's message to me, wipe out my retirement account and go to a more condensed portfolio. The outcome? Simply fantastic. But what I am getting to is I think overall the China game is false bravado. It is fine that Charlie Munger could go here, but few are like he was. One of my insights as to this is reading British/English history, particularly the Wars of the Roses era of absolute gyrating politics, the behavior of those taking sides and simply how fragile both beliefs and bravo was. One shout in the field during crisis and everybody ran...and I mean everybody. I got out of debt and the insurance business in 1994 and I pledged on my knees to my inner self never to do it again. "It" involved getting to know myself. After acknowledging to myself who I am? Amazing stuff came. Best with China is to know yourself most of all. Who are you and what are you going to do with all the mouthing, threats, and crazy beliefs surely coming as to it all. That said, I'll wager a boom upwards at some point too. Castanza too though has a valid point that the US jargon is in game too. That jargon is going to ratchet up intermittently even if those chanting are in business and making money there. Count on it. Life is great...if you can stand it! For me, it just goes back to what Buffett says...look for 3-4 foot hurdles, rather than 8-9 foot hurdles. I can live with missing out on something, but it kills me when I lose money on something that has more risks than I can get a firm handle on, but I put money in it because I thought I understood that risk. I've learned there are a lot of things I do not know and cannot accurately evaluate long-term. So I choose not to play that hand. Cheers!
Hektor Posted January 29 Posted January 29 Looks like the Evergrande saga is coming to a close. This might give a glimpse of what happens to rights, particularly those of foreign investors. Will the Chinese stocks take a dive tomorrow? “After multiple delays and even a few faint glimmers of hope, a Hong Kong court has sounded the death knell for what was once China’s biggest real estate firm.” “What happens next in the unwinding of Evergrande will test the belief long held by foreign investors that China will treat them fairly. The outcome could help spur or further tamp down the flow of money into Chinese markets when global confidence in China is already shaken.” http://archive.today/uX5LB https://www.nytimes.com/2024/01/28/business/china-evergrande.html
Blake Hampton Posted January 29 Posted January 29 16 hours ago, Hektor said: Looks like the Evergrande saga is coming to a close. This might give a glimpse of what happens to rights, particularly those of foreign investors. Will the Chinese stocks take a dive tomorrow? “After multiple delays and even a few faint glimmers of hope, a Hong Kong court has sounded the death knell for what was once China’s biggest real estate firm.” “What happens next in the unwinding of Evergrande will test the belief long held by foreign investors that China will treat them fairly. The outcome could help spur or further tamp down the flow of money into Chinese markets when global confidence in China is already shaken.” http://archive.today/uX5LB https://www.nytimes.com/2024/01/28/business/china-evergrande.html You know I had the exact same thought at first, but thinking about it further, will there even be any money left for investors? The Evergrande situation seems especially bad to me. Basically the company took down payments to start massive amounts of developments, without ever finishing any of them. There are currently people who bought homes that probably won’t end up being built. I would think any money still lying around is gonna have to ultimately go to those property owners. I think what’s happening in the Chinese property sector right now is wildly interesting and if anybody has any further insight, I would gladly hear it.
Parsad Posted January 29 Posted January 29 British Columbia businesses feeling the pinch from China consumer spending: https://biv.com/article/2024/01/bc-businesses-pinched-chinas-cooling-economy?utm_source=BIV&utm_campaign=8a348efb0a-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_ba3660ab09-f74cc7858e-[LIST_EMAIL_ID]&mc_cid=8a348efb0a&mc_eid=14159a6e02 Cheers!
Parsad Posted February 2 Posted February 2 https://www.cnn.com/videos/business/2024/02/02/china-economy-online-ban-critics-watson-ac360-vpx.cnn Cheers!
Hektor Posted February 4 Posted February 4 “Apple, Mondelez and Procter & Gamble are bullish on consumer spending growth in China despite recent economic turmoil there” https://archive.is/zYXpE Snippets from the article: “We’ve been in China for 30 years, and I remain very optimistic about China over the long term,” Apple Chief Executive Officer Tim Cook told analysts “Jon Moeller, CEO of consumer-products company P&G, said during a recent earnings call that in early January he spent six days in China, where he met the company’s local employees and government officials and visited residents’ homes to talk about their buying habits. That experience bolstered his view that challenges in the market are temporary and that there would be opportunities to expand the company’s business in the years ahead.”
mattee2264 Posted February 4 Posted February 4 Must be some good companies that have been thrown out with the bathwater. Mandarin Oriental comes to mind. At similar levels to depths of the pandemic. Jardine Matheson is a solid storied conglomerate Marty Whitman used to love Henderson Land, CK Hutchinson Holdings, Wheelock etc.
Hektor Posted February 5 Posted February 5 https://www.nytimes.com/2024/02/05/business/us-treasury-officials-china-visit.html Top U.S. Treasury Officials to Visit Beijing for Economic Talks A meeting of the new economic working group comes as the U.S. and China are trying to prevent any escalation of hostilities. The Biden administration is dispatching a high-level delegation of Treasury Department officials to Beijing this week for a round of economic talks as the world’s largest economies look to continue engagement efforts that President Biden and his Chinese counterpart, Xi Jinping, agreed to pursue last year.
james22 Posted February 5 Posted February 5 If you can't report on China, why would you invest in China? https://chinaarticles.substack.com/p/failure-at-the-wall-street-journal
formthirteen Posted February 5 Posted February 5 Quote The CSI 1000 gauge, frequently used as the underlying benchmark for snowball derivatives, has been facing selling pressure as the products hit so-called knock-in levels that incur losses to investors. It slumped as much as 8.7% early on Monday before closing down 6.2%. Read more: China Snowballs and Their Role in This Year’s Stock Selloff: Q&A The latest slump has led to fresh concerns over a wave of margin calls as the value of shares put down as collateral shrinks. The fear is that investors failing to top up their margin trading accounts may be forced to liquidate their positions. Quote “We are at that usual stage, the final leg in a selloff when things get really bloody,” said Ma Xuzhen, fund manager at Longquan Investment Management. “There’s really no point getting anxious at this stage, we all know it’s near the bottom.” Quote “Whether or not today marks the floor to Chinese equities is yet to be seen but it sure feels as though we’re bumping along the bottom as policymakers have signaled they no longer want to see any further declines,” said David Chao, a strategist at Invesco Asset Management. https://finance.yahoo.com/news/china-stocks-languish-despite-renewed-015027580.html The CCP no longer want to see any further declines.
ValueArb Posted February 5 Posted February 5 I have a backlog of new tender offers to read through and came across this one. Alternative Liquidity Index put out an offer to buy up to 10M shares in SVA (Sinovac Bio) for 3 cents. Now SVA stopped trading nearly 5 years ago due to a legal dispute over a share exchange that has yet to be settled, and last trade was at $6.50. Book value reported at year end 2022 was roughly $100 per share, and they claim $14/share in cash and roughly $80/share in investments as of June of last year, I guess I have to give Alternative Liquidity some props for an audacious attempt, but if they really think they'll be able to trade these shares someday (and that they are anywhere near book value) maybe offering a few bucks per share might actually get them some in volume. Or SVA is just a fraud, so why buy at even 3 cents? https://www.sec.gov/Archives/edgar/data/1084201/000110465923097975/tm2325464d1_ex99-a1.htm
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