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9 Oct, 4 tweets, 3 min read
1 A thread on China NDRC proposed ban on private capital in news media business and potential impact on companies like #Weibo #Tencent, @caixin_intel, #36kr etc. and other private financial companies like #蓝鲸 #财联社 baijiahao.baidu.com/s?id=171306686…
2. NDRC：I have written about it and how central it is in China’s state-owned part of the business, which is still close to 40-50% of China GDP. It is central to understand the energy crisis because it has a say on coal production and electricity price.
3/12 China Market Entrance Regulations, similar to the Foreign Capital Entrance Regulations that's behind the reason for the VIE structure, creates a lot of arbitrage opportunities, if you are a brave lawyer/businessman. Link in Chinese of the 2021 Reg. ndrc.gov.cn/yjzxDownload/s…
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Liqian Ren Profile picture
10 Oct
1/14. A thread on India/China. A rumored but likely authentic notice of #Walmart moving it's "Supplier Enablement Team" from #China to #India has been circulating on Chinese social media. Is this the beginning of business decoupling? A few pointers.
2. First, my understanding is Supplier Enablement team is to help suppliers getting their business efficiently so Walmart has efficiency in its own part of business. It is likely tied to Walmart commitment to source $10 Billion of India-Made Goods Each Year by 2027.
3. But is this a leading event in a significant shift of international businesses moving from China to India? It remains to be seen & an active area of attention. Southeast Asia are the common denominator in many of these supply decisions on the ground.
Read 18 tweets
Liqian Ren Profile picture
9 Oct
4. Is this regulation something new? It is officially codifying existing facts on the ground. The rumor is after the Edu regulation debacle/Edu Minister fired, this is govt trying to set it officially, so private capital doesn’t come in, then got banned, raising another uproar.
5. Will @caixin_intel /@Caijing be banned now? Likely not. They are state owned media, as Twitter labelled them thus, even though in China, they are considered somewhat opposition media and got article censored left and right.
6. What about Weibo/Tencent? First order effect are small because they were only in news distribution business, never in having actual journalists and news creation business. But there are some secondary effects.
Read 11 tweets
Liqian Ren Profile picture
8 Oct
1. Is financial market pricing in some heightened Taiwan Strait war risk this week? Yes, a little. No perfect measure. With China on holiday last wk, can attribute some pop of 5-yr CDS price as caused by heighted attention, which happens around Oct with back to back national days
2. To put in context, China 5 Yr CDS value is 48.87, reveals a 0.81% implied probability of default, on a 40% recovery rate supposed. US 5 Yr CDS is 17.4, reveals a 0.29% implied probability of default. Recent increase in US mostly by the debt ceiling fight. #MintTheCoin hahaha
3. @PredictIt betting market doesn't have a Taiwan specific market, but has 3 China related contracts. Betting on who would be confirmed for next US Ambassador to China, and Pres. Xi's chance of staying as party General Secretary for next 10 years.
Read 11 tweets
Liqian Ren Profile picture
7 Oct
1. Another question I constantly get: Can Chinese data be trusted? High Frequency data shop like Baidu or other private data source advertise their data showing similar thing as govt economic data, but more real time = acknowledgement of recent higher quality govt economic data.
2. Around 2014, the central government was extremely concerned that several northern provinces’ reported GDP numbers were overinflated by local officials. In 2016, the LiaoNing province in the north was asked to reduce its reported GDP figure by 22.4%.
3. 2018, after the fourth national economic census, 12 out of 15 northern provinces’ GDP estimates were adjusted lower, while 14 out of 16 southern provinces were adjusted higher. Jilin and HeilongJiang, both northern provinces, have respectively been adjusted down more than 20%.
Read 6 tweets
Liqian Ren Profile picture
6 Oct
1.@AmbassadorTai not a trade but US Industrial Policy speech: "make smart domestic investment to increase competitiveness. invest in R&D and clean energy technology, strengthen manufacturing base, incentivize to Buy American up and down the supply chain." Self reliance anyone?
2. I thought I was the optimistic one for both US and China, but Marko Papic of Clocktower argued that in the near future, US-China relationship will get WORSE AND both US and China will have growth that surprises on the POSITIVE side!
3. In some way, it's not an unreasonable proposition. Both US/China are going to invest heavily at home in human/physical capital, which should bid well for near term growth. It's easy to see China/US in an investment race. The bills coming out of congress are in Trillions.
Read 7 tweets
Liqian Ren Profile picture
4 Oct
1. Is #Evergrande stock suspended news? If you've followed me, you know I've said many times the screenplay on how to restructure is largely already laid out in past restructuring of companies like HNA or Huarong. #HNA Group is turned into a trust to pay to bond holders.
2. How long will it take? Majority of HNA restructuring took about 10 months, with the rest still ongoing. It's broken into 4 pieces with three parts introducing strategic equity investors, with the rest turned into a trust for bond holders.
3. How about the those wealth management products? HNA bankruptcy procedure mentioned that if all law is followed, they are likely so low in debt priority to get nothing. But it gave each person Yuan30k, with the rest going into official pool of debtors. Call it socialism.
Read 5 tweets

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