Didi, Alibaba, Tencent: The Risks of Investing in Chinese Tech | WSJ
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- čas přidán 20. 08. 2024
- Chinese tech stocks popular among U.S. investors have tumbled amid the country’s regulatory crackdown on technology firms. WSJ explains some of the new risks investors face when buying shares of companies like Didi or Tencent. Photo Composite: Michelle Inez Simon
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#WSJ #China #Tech
in China, the government regulates the big tech to maximize their responsibility within the society and economy.
In America big tech influences the government to maximize profit at the expense of competition.
In China the Government regulates Big Tech to ensure the rule of the CCP is absolute.
US Federal Government is also trying to influence in Big Tech. Mainly to bolster approved narratives whilst blacklisting others.
@@sauljahboi5965 Governments have a MUCH broader responsibility than corporations, that involves social, economic and political stability, which all contributes to the quality of life of the citizens. Big Corporations has NONE of the above responsibilities, they might tout to have social responsibilities but that's more of a PR stunt and virtue signaling than anything else.
So to frame China's regulatory measures as "absolute control" is to distort the truth to fit your own narrative, most Chinese or any logical person trust the government over a corporation, whose interests and responsibility goes to investors first and everything else second.
@@obsidianstatue this is just common sense that many westerner dont have
Very well said, it's scary to think about that so many westerners believe big corporations controlling both the government and media is good for the people, lots of people don't even realize that
I think you are correct. It looks like the sellers today are mostly retail. The smart money buying today: Mohnish Pabrai bought/added BABA shares four hours ago and Tweedy Brown added shares both yesterday and the day before yesterday. Brown owns 1,547,318 shares. I'm not sure if that includes the shares he just purchased. Let's see what happens next week. Obviously, many do trust China. US investors do not listen to US MSM and warn against it. It is likely that many see the recent CCP moves as an effort to protect not only the investor but also to provide an opportunity for new entrepreneurs in the field.
I love the line, "We thought we new the risks here." If you even remotely understood the risks, why in the world did you invest in these companies??
The question is why isn’t the United States taking the same steps for our big tech company’s
For a long term and healthy growth, they need these tech companies responsible innovation and involving in social responsibility, rather than “their profit only “.
That isn't what this is about at all. This is a power-purge. Unlike Deng, Xi is a old school Leninist and worships Mao. Tech companies got too big and Xi wants to weaken them as well as reel back China is be closer to a true communist state. As to how far he'll take it is anyone's guess.
@@LaFonteCheVi its a communist state with Chinese characters
@@LaFonteCheVi This WSJ video is partially baked. The Chinese ADR stocks in the US are under heavy scrutiny since Trump in power. Those ADRs are often not registered in China but in the third party countries, as well as not necessary have to comply with US regulatories compared to US companies for their required quarterly accounting and more importantly their sensitive data. Now the US Congress has passed the law and scrutiny regulatory regime to require all Chinese ADRs to report their data. TikTok's most advanced algorithm AI technology was one of the prime examples where US such as Pentagon, and Silicon Valley's tech giants are lacked and eagle to steal. Now, China is not at the comfortable seat..
@LaFonteCheVi china’s no way near communist lol it’s the most capitalist state like the states with more the government more control
@@LaFonteCheVi To be precise, it is state capitalism.
It's not crackdown, but rather an adjustment of the over concentrated market to allow small businesses to have a living space. Definitely a good thing for the long-term economic development.
Found the wumao
@@LaFonteCheVi found the 250
@@LaFonteCheVi CIA troll?
@@nicetry3381 hey baiting fisher go
Home
CCP
Won’t work pay you
Greed, monopoly and arrogance are the norm for any internet companies, America, China and elsewhere.
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in the US, businesses regulate goverment
The alternative that governments regulating businesses isn't good either. There's gotta be a better solution that meets at the middle.
Only if you're delusional.
The us government controls all American tech companies then they says is private joke
@@thomasphilip8916 you're both incompetent liars
Joel No, the government is the guardian of the people. It’s the ultimate authority and arbitrator of interests.
the risk of investing in China: the chinese government would actually do their job and regulate big corporations when they seem to start to misbehave
i personally think tencent stil has great potentials, the E/P ratio is almost done to 20 now, its a good time to buy for anyone capable of doing so
As opposed to the lack of the US government regulating big US corporations?
@@ganonk79 as opposed to US lack of regulation on military industry and financial sector yes
lol biggest fear of US capitalists: *Being regulated by the government, not the other way around*
No. The risk is if you are a foreigner you are not welcomed in China. China views foreigners as troublemakers at worse, and as potential prey to rob and steal at best. There is no future for foreign investment in China.
Basically CCP can come out with any new regulation overnight at the expense of US investors.
No at the expense of CIA who wants chinese data
Theres a reason why all the fintech companies get regulated. China ccp did the right thing before they get too powerful and control government. Look at US itself now in a mess, companies like Amazon, google, facebook, netflix and etc see how much taxes they evaded. How much these tech companies contribute back to US society ? ZERO. The rich gotten richer poor gets poorer. What china did was to distribute the wealth and make the middle class come up. Now even your oen US government even tried to copy China. What a joke !!!
@@DennisOoJennNing Are you in the pay of the CCP?
@@jerryrichardson2799 can’t imagining anyone speak advantage of ccp is thought to be a wumao. Really Chinese like me feeling theses word nothing in problem
US investors? Is US really got any money after 2008? 🤣
if you are long term inverter, those regulatory restriction or new rule can potentially benefit the company and the broader environment in the long run. Just dont put all your money into one pocket.
I am not getting any long term inverter..sigh 🧐😩
Disagree. All this is going to do is put people of investing.
In the short term Chinese internet stocks will fall as stocks are popularity contest in the short term.
In the long run it is a weighing contest…….it will go up as the fundamentals are solid.
The Chinese government is only interested in the long run as healthy companies will prosper in the long run.
The Chinese government don’t like excessive speculation.
Hello, Would like your opinion which platform would be best if I want to invest in cryptocurrency especially BITCOIN....?
Diversification is often the best way to hedge against a bear market. I'd suggest you consult an investment advisor or professional if you're a newbie
@@jacobhenry9779 you're 100% right
following the guidance of Mrs Laura Lynn. I would consistently pick stocks that would be sure to make me money.
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If you own shares of companies that are based in mainland China, you don't actually own any part of the company, except the assets they have located outside of China.
It really depends on which tech companies you invest in
under ccp, they are all the same, if ccp crack down on you, you got nothing over night, it all depends on the government
China : cracks on its Tech companies.
India : Creates 21 Unicorns valued over Billion dollar in 3 months .
That was bound to happen.
Then 5yrs from now when India tech starts censoring India’s leaders on social media, then India can finally join the US, EU and China on managing big tech. The US and EU both have variations on Chinese tech policies but bc Chinese are efficient they moved first. US Congress envious of China speed and will use China to get their slower moving colleagues to act faster.
@@thevan4476 India already is doing that in a small scale.
Check out Amazon and anti trust laws on them in India.
@Man at the end of the universe Lol numbers never lie, your comment is literally an oxymoron
I have some feedback on the graphics in this video. The fundamentals of presenting any sort of chart is labeling BOTH the X and the Y-axis. If you are going to present a chart like the one at 0:22 then it might be an idea to label the y-axis. Is the percentage the sell of, is it the stocks price development from a base level (marked as zero), is it the 200-day moving average? It is unclear, and shouldn't really be an issue in a professionally produced @WallStreetJournal video. Hope to see better next time.
Don't invest in any company when you can't verify their income and profits. Step one of investing. :|
There is something called "deep value" or "distressed" investing which is buying up garbage companies where no real valuation is possible. Although that's a high risk hedge fund style investing, and deep value investors admit there's a lot of gut instinct involved.
Although I can see what you mean: A lot of weird capitalism happens in Communist China.
Yeah that's the rule for investing. But most people are speculating. First rule of speculating is first in, first out. They don't care if it's healthy or not.
I think the investors just haven't get used to the mode of Chinese regulation.
Better to buy Chinese state owned companies like PetroChina, State grid or ICBC etc than tech companies.
if the same thing (regulatory agencies doing their job) happens in western countries, it would have a similar effect on stock prices, they'd go down, and the explanation would be something like "the companies didn't do their job following regulations", but because it happened in china the explanation is "because china"? is that it?
What are you talking about? This would never happen in America where whoever has bigger money writes the law
@@ZZ-qu7bq its the whole following regulations thing, in the US the government can indeed pass regulations although more gradual and subtle but the end outcome is the same, the reason why they are doing this is due the the increased power and influence of these tech companies. an example is like facebook who has come under data security concerns.
@@_blackheartemoji_2189 The US government can, but it won't, at least without approval from congress and senators which are in the pocket of large corporations. Tech companies and media companies have influence over the government too but they are all financially connected to other corporations.
China data protection rules?
yes because the CCP dont have access to the data collected by these tech companies such as DiDi so they are salty
“ china’s data protection rule” lol
to be fair, China emulated much of the US post Patriot Act. Then the Snowden revelations came out and they just emulated that too
😋😉
😂😂 true
@@SridharPatchigolla does your being actually have any truth “sir” five books reveal yea’ one is unlocked, so children play, as one can see.
Yet there is a book still with seal’ as lightning words have revealed. Enjoy your day sir.
so the prices of shares of Chinese giant companies are going DOWN these days right? thanks for information, seems like it's the closest time to catch the opportunity being Buffet
Buying Chinese stocks is like buying Detroit real estate: It's cheap for a reason.
Lol
Short sellers like to send out false stories that the government will take over a company.. usually it’s BS. China is dangerous, there’s no way to keep them accountable when they jack your money. China is a terrible investment.
The dollar is just a piece of paper worthless
@@billkar6479 lol. I see someone’s butthurt that they weren’t allowed to immigrate here. 🤣
Tech companies listing their companies in foreign stock market especially US could means that these companies has to obey local laws and regulations. Which means Chinese data could potentially be spied on by US government. So the Chinese government stepped in
Western market: invisible hand.
Chinese market: naughty hand.
Gives heed to the word Nasty’.
Western market: crony capitalism
Ccp afraid that big tech corp can become too powerful to rival them on information flow to the chinese people.
Bingo Bango
Bad for the monopoly and giants, but good for the starts up and the market, also customers
no tax on the rich, poor infrastructure, ban on Huawei, yeah that's good investment?? are you kidding me?
What?
@@Tienisto he's just mad he lost money investing in cheap Chinese stocks nobody wants to buy
@@downloader950 U.S. dollar inflation is too high and too much waste paper is printed
@ half of China still lives in poverty. The average chinese works in a shoe factory in a town nobody has ever heard of working 12hrs a day
low risk, high uncertainty. nice
Mohnish Pabrai wisdom right there
what risk? you either hack computers and other devices through them or hack them and get everything
I don't see the core problem of Didi's punishment in this article. Before the introduction of the new policy, he suddenly listed in the United States without the approval of the government and without the knowledge of the market. What's more, companies listed in the United States require to report the privacy information of enterprises and customers to the New York Stock Exchange. Do you know how many customer information data didi has in China?
Let's talk about Alibaba. Jack Ma said at the Shanghai Economic Forum that the government management department is too strict and that the international Basel Accord is a club for the elderly. But few people tell you that Alibaba's leverage in Internet Finance in China is more than 300 times
Monopoly is bad for tech industry. FB, AMZN, MSFT have no rival in their perspective field.
bought 100 shares of Tencent today
Would it be a good time to buy in? They’re bound to make a comeback.
Wait until CCP calm down on tech regulations first.
Your better off buying FUTU,TIGR. Qfin,Bili, and Beke
But the thing is China has become so big that even the investors would have a second thought to pull money out of chinese firms regardless of fears of the regulations of ccp as the reward is so massive
It looks like the sellers today are mostly retail. The smart money buying today: Mohnish Pabrai bought/added BABA shares four hours ago and Tweedy Brown added shares both yesterday and the day before yesterday. Brown owns 1,547,318 shares. I'm not sure if that includes the shares he just purchased. Let's see what happens next week. Obviously, many do trust China. US investors do not listen to US MSM and warn against it. It is likely that many see the recent CCP moves as an effort to protect not only the investor but also to provide an opportunity for new entrepreneurs in the field.
You simply need to have your extra room because they don't have proper law. While you value the company and their cash, you simply need the gap.
Didi didi didi
Oh I have kept investing here hope it will remain safe for next 10 years
in usa, big companies control the government. Why? Because they hold big cash
Basically, those companies all have government shares inside if they didn't it would have never grew that big they just want full control of the company
How about investigating the Alibaba Director's decision to take Alipay off shareholders and transfer it to Jack Ma's personal company with no compensation to shareholders, or the subsequent drop in share price and forced takeover at the lower share price.
Chinese accounting standards are questionable, and the fact the government can seize corporations make them risky investments
You need to know the truth is the Chinese government always care about people living, so many corporations are not good to companies
risk or opportunity ?
Government protests the people from companies.
@@AvadaKedavra943 or the CCP obviously feels threatened that the companies are getting too powerful for them. It's a dictatorship, they want absolute control of everything that happens
American accounting standards are the most questionable. So, is it's judiciary. A corporation and it's C-suite can buy their way out of 400 lawsuits, causing an epidemic and murdering thousands of people.
No mention of China's edtech crackdown.
China succeed where America failed: rein big techs and America is angry for it XD
An UFO passes by the scene at 3:25
*helicopter
@@es7nb yes i know ;))
"Opium for the mind"
You know they are right.
@@DK-yz9xk Of course everyone knows that too much video games are not good for anyone. The question is does it actually do any good to just have a blanket-all ban on video games for all children, or is it better to let parents control it the best way that they can? For example, if you throw an alcoholic in a cell with no alcohol, they will be sober while they are in the cell, but it is also likely that as soon as they get out of the cell, they will just be addicted again. A ban of the symptom likely will not solve the root cause of the problem, but it will for sure take away everyone's freedom to do as they please.
@@CJ-re7bx They're only limiting (note: NOT ban) online games (note: NOT all games) for underage children (note: NOT applicable to adults) to a few hours a week (note: few hours per weekend is fine) during the school term (note: NOT applicable during school holidays). You can have your gripes but this new law is hugely popular with Chinese citizens, to whom their govt is ultimately responsible for.
Is your govt responsible towards the common folks in your country? Your media is obviously lying to you about China at every opportunity, but why do you choose not see it? For what reason? To what end?
@@lq9734 we will see how this all shakes out. I don't think it will be pretty at the end of the day.
@@CJ-re7bx You can imagine whatever you want, however it will not have any bearing on reality.
At least they are making an attempt. Again, what’s your govt’s solution to video game addiction in increasingly younger children? How will exposure to games based on loot box mechanics and desensitising violence at such a young age affect your society? Look around you, it’s already too late.
China company: dip
me: time for me to become another Warren Buffet
▶️ 3:20 - Variable Interest Entity (VIE)
Just one thing... All in BABA and PDD
"In many ways Didi is the Uber of china" ,considering Didi bought Ubers Chinese unit , I think its safe to say so....
资本无序扩张，每个大公司都想放贷，都想卖菜。只能说干的漂亮
English , ty
English man！
@@shawncheng404 cao ni mada
@@es7nb nimasile simawanyier，niquanjiabaobi
@@shawncheng404 cao ni ma
what if they playing pump and dump game
How Americans still allow launch of Chinese companies show the difference between American investor and thinking of us govt. Clearly investors want to invest irrespective of what Chinese govt do to these companies. If in the process, American investors lose their capital then should the investors blame the govt to allow the IPO in USA or listing of these Chinese entities in USA?
If american investor believe in their politician then they will follow the lip service that their politicians usually give to poor democratic countries like india and Philippines to actually go and invest there.
Why haven't they done it?
Because an investor with common sense understand that competent one party rule = long term profit
And poor democracy = long term chaos.
China is following Singapore ways of handling the market & economy. No individuals are allowed to be rich except those affliated with the government officials & their respective family members
Hey
Can anyone explain the difference between a depository receipt and a varied interest entity ?
@WSJ
An American Depository Receipt is a situation where foreign shares are deposited in a American bank at a specified ratio (i.e. 1:4 or 1:2, etc). This is strictly a pass through arrangement. The bank is just acting like a middle man, handling the complexities of foreign taxes and foreign exchange. You can go to the bank at any time and pick up the actual foreign shares anytime you like.
VIE's are technically ADR's, but the underlying foreign shares are not the underlying shares of the company, but rather shares of a legal entity domiciled in a place like the Cayman Islands (rather than in the PRC), and the video (and other articles) discuss the gray area of the actual legal ownership that the entity has over the actual business in the PRC.
@@davidhaha wow, that makes sense..
Thanks a lot!
@@davidhaha have anyone actually ask and get a foreign share?
We should shift to other industries. After all, China is still THE growth market. I will make some videos on these.
Wonderful voice.
Ideal for such videos.
Good
DEFEND TAIWAN! FREE TIBET! SAVE XINJIANG! LIBERATE HONG KONG! REVOLUTION OF OUR TIMES!
Bring democracy to oil rich country or have weapon of mass destruction 🤣🤣
liberate Barcelona also
🤡🤡🤡
You can never free those Indian kids buried underground
@@huarongliu8938 That doesn't makes any sense
be greedy when others are fearful
this rule does fit in chinese stocks. they are strongly afftected by the policies of CCP
But this is also just how capitalism works in Communist China.
@@samsonsoturian6013 that why i sold the large portion of my chinese stocks. that market is not transparent and policy can be made overnight. how can a normal investors earn money in such a market??
@@m.preacher2829 yes, but you can also gain a lot by the policy of ccp, like some energy industries and semiconductor industries.
@@m.preacher2829 worse than making policy overnight, government policies often change that retroactively punish people for acts that were legal when they committed them.
SUN 6
Big techs need to be reined for the welfare of the whole society.
Do they? Who says? What could happen if they dont? Alibaba going to build an army?
It is all about the money... just the money and the CCP wants it. There is no danger to you. Besides the CCP is only helping western companies by hurting Chinese competition. If you think the CCP knows what it is doing and why. Try explaining it to your dog and see what he thinks.
Can't blame China for that
Invest in India 🇮🇳 🇮🇳 rather than communist countries 🇨🇳😏
True
It’s not a free country.
you mean USA?)
@@vitaliy2847 please. The USA is much more fee than China will ever be.
@@vitaliy2847 wumao
how ironic that all these companies are monopolies and how did they become monopoly? china supported these companies and america invested and made a lot of money.
I like how WSJ cherry pick facts. They did not even mention that it is the US that allows SPV IPO in the first place. And that US gov is still not doing anything about it. The action from chinese actually benefits american for once.
Bout time league of legends got nerfed.
To whoever is reading this,
You are loved.
You are blessed.
Your dreams are manifesting as we speak.
Time is on your side.
Everything will work out in your favor.
May you find more love, peace and prosperity❤❤❤🙏🙏
🔴In your opinion (IYO), should Ant Group be regulated as a traditional bank (meaning it has higher reserve requirements) or a tech company? Why do you say so?
🔴IYO, were there political reasons behind China's last-minute cancellation of Ant's Shanghai IPO? Why or why not?
🔴Would you say that China's crackdown on Big Tech is to rein in monopolistic behavior, is due to it feeling threatened by tech billionaires, or both? Why do you say so?
🔴🔴How would you describe the following to your foreign classmates:
🔹️socialism with Chinese characteristics
🔹️common prosperity
🔴What are your thoughts on China's crackdown on the following industries:
🔹️video games (Tencent? Netease?)
🔹️tutoring
🔹️Big Tech (for anti-competitive practices)?
Fair? Unfair? Both? Why?
🔴Do you think China will crackdown on VIEs? Why or why not?
Wonderful vid!
Did Jack Ma get released from Laogai?
What a pathetic brainwashed guy to believe the western media. haha
No the CCP threw Jack Ma in a secret prison which is his yacht full of girls, he was tortured by the girls and forced to drink champagne and eat lobsters every single day for a few weeks totally out of the public sight. Now he finally escaped and back in front of the public, and he has to count the millions of dollars he made while in prison. This is how cruel it is.
China screwed US investors. 😂
I would rather buy bitcoin than Chinese stocks.
Pls people in comment pls cut ur armpit hair can u smell ur malice across the screen!LOL
U do smell it 🤪
It’s the Mao era all over again.
No
Its copycat companies, what do people expect? No investors worth their salt would be putting all their eggs in a chinese basket
Perfect buying opportunity lol
No one with a long outlook will invest in a unstable business enviroment like that. And if they do they are sure to lose money on such lisliate blunders
@@0dyss3us51 sssh let him be
Investor Quoting WB : be greedy when market are fearful.
Market are fearful.
Investor quoting WB : not this one.
Lol.
Happen many time, like last year with facebook. People always have reason not to buy at the bottom.
@@0dyss3us51 Buy high and sell low is a great strategy. It matters not if they get delisted as the fundamentals are what actually matters. By 2030 China will be the largest producer in the world, #valuations matter. Why would I buy U.S equites with PE multiples of 25-30 when I can buy perfectly good businesses with PE multiples of 2-6. Over the long term we all know what the safer option is.
@@liampett1313 buying high and selling low? 😂🤣 pretty much says it all doesn't it.
Move the investment to china an Russia India doby is at good choice
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I have heard a lot about investments with Mrs Elizabeth A Palmer and how good she is, please how safe are the profits?
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The risks of investing in a country that is reverting to 1960s-style socialism
Yeah but it's so big! This has been the conundrum forever.
boycott the china winter games
why?
Just do it ,coward.
All of those companies produced spiritual opium! 🤣🎉
The economy hardship, recession, unemployment and loss of job caused by covid pandemic is enough to push people into financial ventures.
I have secured financial freedom by investing in bonds, equities, EFT's and some digital currencies
@Evelyn Hernandez That's why you need the help of a professional who trade and understand the market more to earn good income. These professionals understand the market like it's there own farm and makes maximum profits for investors.
I know how and why this is happening, but since I am not being paid to tell, I will just have the free speech right restriction self-imposed >)
Avoid Chinese stocks pure and simple!
Stocks are about to tank. UVXY season
You can't buy Chinese stocks, you merely look after it for the polit beauro
Saludos gente maravillosa y bella
Investors always has to keep in mind the CCP can do what they want. For the past few months I have shorting the Chinese market, even though the CCP supporters said I could not.
Actually this news is good for other countries. Harsh regulations will let chinese companies lose its power(ex.Alibaba or tencent), so this is an opportunity for other emerging markets such as Taiwan or Korea. Thank you CCP!
Um no, it just means the government controls those companies. They still have power of scale.
Thats proactive steeling of capitals: capital must not control politics, also inline with social responsibilities. Leant the lesson from USA, that’s capital controls politics, military, and everything else. Key difference between socialism and capitalism.
Nice video.
Do Turks still support Erdogan?
@@Robertsmith001 i don't support anyone.
buy the dip
You got to make sure it is a dip
Time to invest
stupid the commentator. The policy is not just something out of brainstorm. It’s something elaborated and weighted over and over. Then it comes to public.
CPC works for d Chinese ppl, not supra national multi billionaires.
Alibaba seems cheap but there are a lot of knock offs so I don't feel safe about them
Then buy the original. Decision is yours. The money is yours. Buy American made, or even Japan made.
The tech monopoly would hurt the whole economy