Charlie on China

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I’ve only seen this 1m 30 sec clip that the CCP have worried investors more than in recent months/ years than previously. He mentions they recognise this and have changed their tune, possibly the reason for the recent rebound and could be a bottom for Chinese tech…

https://youtu.be/X75HkBZm6Po

Overall he took the view that he could get more bang for his buck with a little political uncertainty. It’s an interesting insight as to how Charlie weighs up risk and reward. Pabrai mentioned Alibaba and Tencent being the CCPs Golden Geese and an integral part of the Chinese ecosystem. They talk so I’d guess this is also Charlies view.

Three questions factored in my own cloning investment thesis aside from attractive valuation. Will they still be around in 10plus years?, check. Will the Chinese economy be the biggest economy in the world by then?, check. Could this be considered a slap on the wrist in terms of regulation?, likely.

https://youtu.be/X75HkBZm6Po

Any other comments?

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Well, baba and tencent etc. also employ a lot of mid class Chinese, who grew up as fans of CCP and Xi ( they mostly had good life and rising living standards).

But they are firing 20% of these people, who btw, supports the local high flying real estate bubble. they are pissed and perhaps don’t like their Dada-Xi that much anymore.

So hopefully CCP realizes Xi is damaging their control to their people. They just need to easy the regulation a little bit and the power of entrepreneurship and capitalism will be unleashed again.

I am Long baba.

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