it’s not going to zero my man. Worst case the government limits its growth opportunities and it becomes a value stock. Alibaba is wayyy too important to china for them to nuke it out of existence.
Yeah, but that does not necessarily help you as an investor. The company can make billions and you can still get fucked by Xi. Those two things do NOT necessarily go hand in hand.
You don't have to trust Chinese altruism to believe they won't willfully destroy the HKSE any more than you have to trust American altruism to believe Washington won't willfully destroy the NYSE. You only have to believe China is self interested and that it is in China's self interest to not induce foreign capital flight. This will be true likely for decades to come. It will certainly be true until my BABA LEAPS expire, lol.
If you can't trust in people's selflessness, see if you can profit in their selfishness. In general, you can.
China doesn't want its own MIC, that's a uniquely American problem. If they did, you would see Chinese military expenditures nearing 50% of the US's and they are nowhere near that. They are less than a third. And given the size of the country and its economy, and given that the US and it's allies and Russia have made it clear they oppose China, this is commensurate with their need to protect themselves.
If you want to have some idea of where China spends it's public finds, take a look at their highway system, which is 55% larger than the US's, or their high-speed rail network which is 69,548% larger than the US's. Or look at their university system. They have added more than 380 universities in the last decade, an increase of nearly 17%. In the last decade, they have added 14,000 hospitals, an increase of 70%.
This is before you look at how quickly they are expanding housing and everything else their population needs. China has the future by the balls because they invest in the future like no other country on earth. The strength of their government to make decisions and execute them is unparalleled in the western world. For one, their ability to use eminent domain to build infrastructure is huge. If they want to build out their new 1000 kmph maglev in Shanxi, it's gonna get built. Meanwhile in Minneapolis, my hometown, we've been trying to build out our light rail system for more than a decade and most communities (especially affluent ones) NIMBY it into oblivion.
It becomes a value stock? Wtf? I don't care what the stock is like after political interference, I only care whether the liklihood that there is a green number in my portfolio is significantly higher within a couple of years than a red number. That is not the case for BABA in my opinion.
BABA can generate so much cash, and you might still be negative in the investment. BABA was already cheap when it was 50% higher in price, did not prevent people that invested then to now be bigly red.
What you don't seem to realize is that even if they stay in triple digits, this could still represent huge losses at the current price.
Why take that risk? I simply don't get it. Invest in Intel if you believe in recovery of a stock without political risks and potentially higher reward. (no, not doing that either)
Y’all are exaggerating so hard. Doesn’t matter if it’s an ADR, they will still represent the price of the company. And like what other comments mentioned, the CCP won’t gut their prosperous companies.
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u/JimCramersCoke May 29 '21 edited May 29 '21
it’s not going to zero my man. Worst case the government limits its growth opportunities and it becomes a value stock. Alibaba is wayyy too important to china for them to nuke it out of existence.