O/t, Kyle Bass on cnbc at 530 am Pac Time this morning

No one has warned investors about the risks of investing in China more accurately the past five years.

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Not sure he is right about China. He wasn’t right about his “red wave” call. The recent meetings between Biden and Xi, along with the negotiating role John Kerry is playing with his counterpart in China, suggests that both China and the US would like to return to a pre-COVID normal. I still think BABA and BAIDU will look like great investments a couple of years down the road.

PP

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FTX’s collapse is just a harbinger of things to come in crypto, says Kyle Bass (cnbc.com)

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good morning, I assume you have been bullish China for a while, right? I think it’s fair to say, Klye has had a better record than you, so far. Keep swinging it might get better. Happy healthy holidays to you and yours.

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I don’t think Hayman Capital’s investing record is too hot. His fund was $300 million in 2020 and he returned capital in 2021.

I think we tend to look at China through an ethnocentric western lens. I tend to think that Charlie is right and that China has a national development plan that has plenty of room for private capital as long as the private accumulation of capital doesn’t undermine the state and the state’s mission of national growth. The current tensions will pass and BABA et al will be fine. The world is not ending, and if it does money won’t matter.

Manlobbi has a great analysis of chia on his page.

PP

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I thought Manlobbi’s analysis was a little too optimistic. I suspect that Chinese companies will/should trade at discounted valuations compared to US companies, based on the ability of the government to step in and take portions of the company when/as they see fit, amongst other factors. I don’t think Manlobbi factored that into his 10 year IV calculations. What that discount should be, and what BABA should be trading at I’m not trying to say. I just don’t think it should be the same multiples as similar US companies.

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