Alibaba stock suffers record fall after antitrust probe in China

[kankan326]

The Chinese governement better reform it's state owned banks monopolies fast then . Since the US( where Chinese tech companies always run to to raise capital and trade their stock) is already running out of patience with them. The US has started looking into delisting Chinese companies from it's stock market or restricting them. So the party better realize it can't eat it's cake and have it. They will have to trade off control and open up/reform this sector . Else their private companies might be facing issues growing and raising capital in future.

I'm not an economist. From my understanding, it's nothing wrong for banks to lend their money for safe returns. Risk investment for startup companies doesn't belong to bank business. It should be done by investment institutions. All Chinese companies listed in US stock market are mature and profitable ones. Not startups. Chinese companies' leaving US stock market will not harm China's progress.

Kankan326, this was a detailed video talked about Ant Group where you can read the description since it spoke in Cantonese. The whole thing is more crooked than those foreigners believe.

Sorry. I don't understand Cantonese

 

[bbccdd1470]

Sorry. I don't understand Cantonese

There are full text in the description for reading purpose.

 

[kankan326]

There are full text in the description for reading purpose.

The Chinese governement better reform it's state owned banks monopolies fast then .

Banks are very special institutions. Private capital should not allowed to enter bank system. Not only because the excessive profit from the money producing more money circle shouldn't be attained by any individual person, also because bankers can influence almost all economic factors, and will eventually influence country's policies and politicians. The country will be ruled by money.

 

[zectech]

CPC runs China. Not Jack Ma. He thought he was an all powerful figure that can’t be touched by the CPC. He decided to talk shit. Now he’s paying the price. Get in line or deal with the consequences. End of!

The CPC should side with vendors in being able to sell in multiple locations, not only on ali. That policy of ali is monopolistic. Ebay does not do this. Amazon does not do this either. Simple as that to allow competition.

 

[Viva_Viet]

To be fair, it's not just the state owned banks who have a monopoly that should be blamed. The problem is with the government and it's policies. State owned banks are indirectly under the control of the state/government and have to follow government policies which means adopting less risks and exposing themselves to minimum risks. This involves not taking risks to borrow to/invest in small private companies/upstarts . That is the policies of this state owned banks and it's welcomed by the government. Since government wants to minimize risk involved in defaults.
The thing is that you can't have your cake and eat it. Lol. The party wants to have completed control of the economy/financial industry/tech industry etc etc while at the same time they also want to see a thriving successful innovative private industry. However they forget that you can hardly have both, since as long as the state gets involves too much in the activities of the private sector then it will.limit their growth and innovation. Since innovation requires risks and a company can be successful and ground breaking without taking risks as well. If you want to have ZERO risk exposure like the party seem to want to think, then you will only remain with your state owned companies dominating every sector and the state running everything, which is not sustainable.
The example you gave is a good one. The fact that Alibaba and other succesfull Chinese private tech companies had to look for foreigners and overseas corporations to lend them money to start their business shows how backward China's capital and state dominated financial system is. They need urgent reforms in this sector. However it will be difficult to achieve , since this will mean opening up the sector and loosening the control/strangle hold of state owned institutions in this regard.

The Chinese governement better reform it's state owned banks monopolies fast then . Since the US( where Chinese tech companies always run to to raise capital and trade their stock) is already running out of patience with them. The US has started looking into delisting Chinese companies from it's stock market or restricting them. So the party better realize it can't eat it's cake and have it. They will have to trade off control and open up/reform this sector . Else their private companies might be facing issues growing and raising capital in future.

Trump signs law that could delist Chinese companies from US exchanges

The Holding Foreign Companies Accountable Act requires publicly traded foreign companies to comply with US auditing rules within three years.

amp.scmp.com

Xi doesn't wanna any more Risk. Trade war against US is already too bad for him. Xi wants the world believe that he already eradicated poverty, but even PM Li also "betray" him when saying "there r 60p millions Cnese earning less than 140 usd per month ". PM Li really made Xi look like stupid, incompetent leader like Gadaffi or Mr.Kim in NK

So many elite Cnese dislike Xi now and Xi must do something to avod having same fate wt Gadaffi

 

[letsrock]

The more i think about it the more it seems to be just an overreaction by markets more than anything. Initialy i was disturbed why Jack Ma is silent on something as important as this and then realized he is no longer chairman or ceo of ali baba. He seems to hold no position there. He should still respond on Ant financial but since it is not public he really has no obligaition to.

As long as chinese govt cracks down on monopolies in fair way and not showing favoritism there is no issue.

 

[52051]

The market has not overreacted, in my opinion it is a fair reaction, since in China every policy is long-termed, it wont arise overnight and it wont disappear overnight, the trend will be there for years if not decades.

So once a policy-change occurs, you need to price that into your asset.

The anti-trust regulation suggesting China is about to do something to capital giant, suggesting in China capital is still ruled by politicians, not the other way around like the case in the US.

As for the contribution of AliBaba, sure it is pioneered many tech in China, but it also kill many small business owners in the process and innovations, and the internet Giants make new tech start-up harder to rise due to the tech and capital advantages they enjoyed, coupling with the rather poorly enforced protection of intellectual property rights, for anything you invented and made, they can do better for half the price with probably more mature tweaks and better advisement just a few months later.

So these internet giant today have too much role in China, they are now try to control the social media and control the public views and Jack Ma go even further: want to control the financial muscle of the country.

They are now way over-their head, Jack Ma once openly declared "working overtime (for the capital owners) is a bless", openly challenging China's labor rule in a in-your-face style. And due to the fact many social media were bought/controlled by his Alibaba group, that comment were not draw many criticism.

So the anti-trust law is much-needed and will be long-termed, China should not fall in the hand of large captial groups like the case in the US, giant captial groups are not too big to fail, they are just too big to make any positive contribution to the betterment of country than almost all alternatives.

As for rising capitals from oversea market, well, to be honest, capitals rised in oversea market play a very insignificant role to China's economy, for a few invidiual company maybe, but thats wont be a factor to concern for policy makers.

 

[letsrock]

The market has not overreacted, in my opinion it is a fair reaction, since in China every policy is long-termed, it wont arise overnight and it wont disappear overnight, the trend will be there for years if not decades.

So once a policy-change occurs, you need to price that into your asset.

The anti-trust regulation suggesting China is about to do something to capital giant, suggesting in China capital is still ruled by politicians, not the other way around like the case in the US.

As for the contribution of AliBaba, sure it is pioneered many tech in China, but it also kill many small business owners in the process and innovations, and the internet Giants make new tech start-up harder to rise due to the tech and capital advantages they enjoyed, coupling with the rather poorly enforced protection of intellectual property rights, for anything you invented and made, they can do better for half the price with probably more mature tweaks and better advisement just a few months later.

So these internet giant today have too much role in China, they are now try to control the social media and control the public views and Jack Ma go even further: want to control the financial muscle of the country.

They are now way over-their head, Jack Ma once openly declared "working overtime (for the capital owners) is a bless", openly challenging China's labor rule in a in-your-face style. And due to the fact many social media were bought/controlled by his Alibaba group, that comment were not draw many criticism.

So the anti-trust law is much-needed and will be long-termed, China should not fall in the hand of large captial groups like the case in the US, giant captial groups are not too big to fail, they are just too big to make any positive contribution to the betterment of country than almost all alternatives.

As for rising capitals from oversea market, well, to be honest, capitals rised in oversea market play a very insignificant role to China's economy, for a few invidiual company maybe, but thats wont be a factor to concern for policy makers.

Those laws arent the problem. China proposed draft regulation on Nov 11. Market did not care - some like Baidu actually galloped. Those draft regulations are tighter than USA but on par with what you have in western europe. There is nothing excessive about it. And no one really believes there is a monopoly at the moment in china. Ali baba maybe engaging in predatory practices but they are small and easily rectified.

Regarding Ant we need to understand Fintech like Ant are actually less regulated in china compared to even in USA. You cant have companies lending money to people and NOT be regulated like banks in USA. so Ant enjoyed a wild ride really.

All set there is nothing that really justified clobbering Ali Baba stock like that. Except an apprehension or general apprehension towards china.

And one more thing foreign trust and money is very precious and very valuable. How many years is china going to overwork its people to get the same or many times lesser benefits that in west ? USA sucks up global capital because of a general faith and trust in how corporate governance in usa is.

 

[52051]

Those laws arent the problem. China proposed draft regulation on Nov 11. Market did not care - some like Baidu actually galloped. Those draft regulations are tighter than USA but on par with what you have in western europe. There is nothing excessive about it. And no one really believes there is a monopoly at the moment in china. Ali baba maybe engaging in predatory practices but they are small and easily rectified.

Regarding Ant we need to understand Fintech like Ant are actually less regulated in china compared to even in USA. You cant have companies lending money to people and NOT be regulated like banks in USA. so Ant enjoyed a wild ride really.

All set there is nothing that really justified clobbering Ali Baba stock like that. Except an apprehension or general apprehension towards china.

And one more thing foreign trust and money is very precious and very valuable. How many years is china going to overwork its people to get the same or many times lesser benefits that in west ? USA sucks up global capital because of a general faith and trust in how corporate governance in usa is.

The market has not reacted much at that time is because, the market dont believe China will enforce the law and taking on these 2big2fail giants.

China has passed similar laws/regulations before, but many are not fully enforced in the name of supporting economy growth, the oversea investors may take that kind of kindness/slackness for granted in this case.

 

[Paul2]

Who did Jack Ma piss of in CPC to be going through this firestorm?

Off to the gulag then?
Damn!! you folks could teach even Stalin a lesson or two.

Alternative explanation from a talkative passing birdie:

Ma very well knew of upcoming crackdown, and he was intentionally warned ahead of time for him to imagine how to wrap it up quietly.

But he as a snark decided to vent off steam in public, so it looked in the end as if Beijing was reacting to that.

Maybe his bet was that Beijing will not dare to put itself in that light.

 

[letsrock]

The more i think about it the more it seems to be just an overreaction by markets more than anything. Initialy i was disturbed why Jack Ma is silent on something as important as this and then realized he is no longer chairman or ceo of ali baba. He seems to hold no position there. He should still respond on Ant financial but since it is not public he really has no obligaition to.

As long as chinese govt cracks down on monopolies in fair way and not showing favoritism there is no issue.

I said it was an overreaction a couple of days back. today Ali baba smartly grew a lot in stock price. There is really no reason to punish Ali BABA for antics of Ant.