6 ms·

A couple of guesses here a. Ant group is partially owned by a large group of elite foreign investors https://www.wsj.com/articles/ant-ipo-promises-8-billion-g

A couple of guesses here a. Ant group is partially owned by a large group of elite foreign investors https://www.wsj.com/articles/ant-ipo-promises-8-billion-gain-for-elite-group-of-foreign-investors-11603970412 https://www.wsj.com/articles/ant-ipo-promises-8-billion-gain..., who will gain hugely from this IPO. The Chinese government doesn't want such a huge financial entity owned by foreign owners (even though they have claimed they are allowing more foreign entries in financial sectors). Also, China is suffering from dollar shortage/flight (foreign manufacturing moving out, foreign retailers moving in), and this IPO could exacerbate it b. Jack Ma recently criticized the Chinese banks https://www.pymnts.com/news/ipo/2020/jack-ma-summoned-for-questioning-about-ant-ipo/ https://www.pymnts.com/news/ipo/2020/jack-ma-summoned-for-qu.... This is a big no no right now, especially since Xi's dictatorship is wobbly. Also this is what happens when you upset the world's largest mafia - Chinese government and Chinese state owned companies. Just look at what happened to Australia https://www.abc.net.au/news/2020-11-03/china-broadens-trade-war-against-australian-imports/12841142 https://www.abc.net.au/news/2020-11-03/china-broadens-trade-..., South Korea https://www.vox.com/latest-news/2017/3/3/14795636/china-south-korea-pop-culture-kpop-attacks-thaad https://www.vox.com/latest-news/2017/3/3/14795636/china-sout... US https://www.defensenews.com/global/asia-pacific/2020/10/26/china-to-sanction-boeing-lockheed-and-raytheon-over-taiwan-arms-sales/ https://www.defensenews.com/global/asia-pacific/2020/10/26/c... and Japan https://www.nytimes.com/2010/09/23/business/global/23rare.html https://www.nytimes.com/2010/09/23/business/global/23rare.ht... c. There is probably a lot of financial misreporting within Ant Group, as it is pretty commonplace for Chinese public companies - check out recently delisted Chinese companies in US stock exchanges. If this IPO is allowed to expand, that's game over for shanghai stock exchange sooner than later. (if you ask me, why would anyone invest in any mafia pyramid scheme with no guarantee you'll get your money out...)

Aperocky 6y ago
Ant is definitely not a pyramid scheme, if you've ever been to China you'd know. But b. is very credible. Jack has been criticized by state media as he piled negative comments to the regulators and traditional lenders - and frankly the regulators were right. Ant essentially needs no deposit to lend, relying on big data and not any traditional financial safety instruments. It's been overlooked for a while but when you get the big benefit of living outside of regulations you shut up and take what you get, and not making a public fuss about how 'every bank is stupid for following regulations'.
- jonathannat 6y ago
  your first sentence contradicts your second paragraph :) > Ant is definitely not a pyramid scheme, if you've ever been to China you'd know. > frankly the regulators were right. Ant essentially needs no deposit to lend
  - franklampard 6y ago
    Low deposit rate makes it a very risky lending business, not necessarily a pyramid scheme
- pjc50 6y ago
  > Ant essentially needs no deposit to lend, Not necessarily deposits but reserves; the whole European financial crisis of 2008+ was over the question of "what IS the minimum reserve level for systemic safety?"? > relying on big data and not any traditional financial safety instruments This is the Boeing 737-MAX approach: it's not intrinsically safe, but we can cover its shortcomings with software.
  - arcticbull 6y ago
    To be fair no giant metal tube is intrinsically safe when thrown through the air at 1000kph. Now, the MAX, obviously, less so haha.
    - enkid 6y ago
      Air travel is extremely, incredibly safe. It's safer than any means of travel have ever been in the history of the planet.
      - solidasparagus 6y ago
        That doesn't make throwing a metal tube through the air intrinsically safe, it just means we're very cognizant of how dangerous it is.
powerapple 6y ago
The sales of shares privately to a group investors in 2018 sounds very dodgy to me. Frankly, listing the company in Shanghai Exchange will give it a much higher valuable than in an US exchange.
- jonathannat 6y ago
  Right now Ant Group's valuation is way lower than their IPO price. It could even be bankrupt and be nationalized, depending on investigations into their books, and what the Chinese government feels like that day. There won't be any Chinese luckin coffee shaninigans in US exchange by end of 2021, according to new accounting standards https://www.thenationalnews.com/business/markets/us-to-delist-firms-that-fail-to-meet-accounting-standards-1.1062124 https://www.thenationalnews.com/business/markets/us-to-delis.... Also, expect a large wave of Chinese companies delisting in 2021. Friendly warning: check your mutual and index funds exposure to Chinese companies on US exchanges.
  - powerapple 6y ago
    Of course last round valuation would be lower than IPO price, that's why IPO is called exit for early investors. And valuation DOES NOT bankrupt a company.
disown 6y ago
> A couple of guesses here Let me guess, it's going to be the mindless propaganda that you've been brainwashed with via tradional and social media. Let's find out. > The Chinese government doesn't want such a huge financial entity owned by foreign owners (even though they have claimed they are allowing more foreign entries in financial sectors). Also, China is suffering from dollar shortage/flight (foreign manufacturing moving out, foreign retailers moving in), and this IPO could exacerbate it If china is facing "dollar shortage", then why would they ban foreign money? Wouldn't they want more dollars? Also, don't people like you claim that china owns us because they own so much of our debt? If so, how can they be experiencing dollar shortage if they own over $1 trillion of US bonds? Also they are not allowing more "foreign entries" in financial sector but they are allowing more foreign entries in retail? Finally, if you think an IPO is going to affect "dollar shortage" issue, then you haven't a clue what you are talking about. What about all the other major tech IPOs, like BABA, which had significant foreign investment. Not to mention all the foreign venture capitalists in china? Why isn't china kicking them out? Has china banned foreign investment/capital? > This is a big no no right now, especially since Xi's dictatorship is wobbly. I thought he was an "emperor" for life. Now his "dictatorship" is wobbly? Be consistent. What's next? You are going to call him a mafia boss? > check out recently delisted Chinese companies in US stock exchanges. Is it misreporting or is it the trade war? https://www.reuters.com/article/us-usa-trade-china-limits-idUSKBN1WC1VP https://www.reuters.com/article/us-usa-trade-china-limits-id... If what you are saying is correct, why isn't the other company affiliated with Jack Ma ( BABA ) delisted? > (if you ask me, why would anyone invest in any mafia pyramid scheme with no guarantee you'll get your money out...) But you were just complaining that "even though they have claimed they are allowing more foreign entries in financial sectors". On the one hand, you are whining that the chinese aren't allowing more financial entries into their market. And then you claim that it's a mafia pyramid scheme that nobody should invest in. Shouldn't you be praising china for keeping "foreign entries" out of their "mafia pyramid scheme"? Once again, be consistent. Another student of peter navarro at the gordon chang's school of propaganda.
- FooBarWidget 6y ago
  Not too long ago, many people on HN were deliberating on how Ant is a national security threat because Jack Ma is a CCP member, implying that Ant is basically a state-controlled organization. I wonder what those people have to say now. Right now I am neither arguing whether it is or isn't a national security concern. I just want to highlight that people's general understanding of how things work in China is very poor, and that one should be careful with speculations like that. At the very least I think more people should recognize that the Chinese government and the CCP are not monoliths, and that the distance between "the boss of the company is a CCP member" and "the company is state-controlled" is larger than what many think.
karmasimida 6y ago
> Also, China is suffering from dollar shortage/flight (foreign manufacturing moving out, foreign retailers moving in) No longer the case after COVID pandemic, Yuan is appericating > The Chinese government doesn't want such a huge financial entity owned by foreign owners Ant had been allowed to exist for a long time, I don't see this really as an issue. TBH, b. is probably the most likely reason. Criticizing governmental authority is a dangerous act even for Jack Ma, especially when your business needs its blessing. Also Ant's IPO had caused quite a lot of controversy even before this, like selling their own shares through Alipay, etc. Anyway, I see this an isolated case, where the CN government wants to give Jack Ma a lesson to put him in place.
beaunative 6y ago
For A, it's not possible to for Ant group's listing to exacerbate China's dollar shortage, as Ant's business is done in CNY and investors would be trading in CNY, at least for it's Shanghai listing.

Aperocky 6y ago

Ant is definitely not a pyramid scheme, if you've ever been to China you'd know. But b. is very credible. Jack has been criticized by state media as he piled negative comments to the regulators and traditional lenders - and frankly the regulators were right. Ant essentially needs no deposit to lend, relying on big data and not any traditional financial safety instruments. It's been overlooked for a while but when you get the big benefit of living outside of regulations you shut up and take what you get, and not making a public fuss about how 'every bank is stupid for following regulations'.

jonathannat 6y ago
your first sentence contradicts your second paragraph :) > Ant is definitely not a pyramid scheme, if you've ever been to China you'd know. > frankly the regulators were right. Ant essentially needs no deposit to lend
- franklampard 6y ago
  Low deposit rate makes it a very risky lending business, not necessarily a pyramid scheme
pjc50 6y ago
> Ant essentially needs no deposit to lend, Not necessarily deposits but reserves; the whole European financial crisis of 2008+ was over the question of "what IS the minimum reserve level for systemic safety?"? > relying on big data and not any traditional financial safety instruments This is the Boeing 737-MAX approach: it's not intrinsically safe, but we can cover its shortcomings with software.
- arcticbull 6y ago
  To be fair no giant metal tube is intrinsically safe when thrown through the air at 1000kph. Now, the MAX, obviously, less so haha.
  - enkid 6y ago
    Air travel is extremely, incredibly safe. It's safer than any means of travel have ever been in the history of the planet.
    - solidasparagus 6y ago
      That doesn't make throwing a metal tube through the air intrinsically safe, it just means we're very cognizant of how dangerous it is.

powerapple 6y ago

The sales of shares privately to a group investors in 2018 sounds very dodgy to me. Frankly, listing the company in Shanghai Exchange will give it a much higher valuable than in an US exchange.

jonathannat 6y ago
Right now Ant Group's valuation is way lower than their IPO price. It could even be bankrupt and be nationalized, depending on investigations into their books, and what the Chinese government feels like that day. There won't be any Chinese luckin coffee shaninigans in US exchange by end of 2021, according to new accounting standards https://www.thenationalnews.com/business/markets/us-to-delist-firms-that-fail-to-meet-accounting-standards-1.1062124 https://www.thenationalnews.com/business/markets/us-to-delis.... Also, expect a large wave of Chinese companies delisting in 2021. Friendly warning: check your mutual and index funds exposure to Chinese companies on US exchanges.
- powerapple 6y ago
  Of course last round valuation would be lower than IPO price, that's why IPO is called exit for early investors. And valuation DOES NOT bankrupt a company.

disown 6y ago

> A couple of guesses here Let me guess, it's going to be the mindless propaganda that you've been brainwashed with via tradional and social media. Let's find out. > The Chinese government doesn't want such a huge financial entity owned by foreign owners (even though they have claimed they are allowing more foreign entries in financial sectors). Also, China is suffering from dollar shortage/flight (foreign manufacturing moving out, foreign retailers moving in), and this IPO could exacerbate it If china is facing "dollar shortage", then why would they ban foreign money? Wouldn't they want more dollars? Also, don't people like you claim that china owns us because they own so much of our debt? If so, how can they be experiencing dollar shortage if they own over $1 trillion of US bonds? Also they are not allowing more "foreign entries" in financial sector but they are allowing more foreign entries in retail? Finally, if you think an IPO is going to affect "dollar shortage" issue, then you haven't a clue what you are talking about. What about all the other major tech IPOs, like BABA, which had significant foreign investment. Not to mention all the foreign venture capitalists in china? Why isn't china kicking them out? Has china banned foreign investment/capital? > This is a big no no right now, especially since Xi's dictatorship is wobbly. I thought he was an "emperor" for life. Now his "dictatorship" is wobbly? Be consistent. What's next? You are going to call him a mafia boss? > check out recently delisted Chinese companies in US stock exchanges. Is it misreporting or is it the trade war? https://www.reuters.com/article/us-usa-trade-china-limits-idUSKBN1WC1VP https://www.reuters.com/article/us-usa-trade-china-limits-id... If what you are saying is correct, why isn't the other company affiliated with Jack Ma ( BABA ) delisted? > (if you ask me, why would anyone invest in any mafia pyramid scheme with no guarantee you'll get your money out...) But you were just complaining that "even though they have claimed they are allowing more foreign entries in financial sectors". On the one hand, you are whining that the chinese aren't allowing more financial entries into their market. And then you claim that it's a mafia pyramid scheme that nobody should invest in. Shouldn't you be praising china for keeping "foreign entries" out of their "mafia pyramid scheme"? Once again, be consistent. Another student of peter navarro at the gordon chang's school of propaganda.

FooBarWidget 6y ago
Not too long ago, many people on HN were deliberating on how Ant is a national security threat because Jack Ma is a CCP member, implying that Ant is basically a state-controlled organization. I wonder what those people have to say now. Right now I am neither arguing whether it is or isn't a national security concern. I just want to highlight that people's general understanding of how things work in China is very poor, and that one should be careful with speculations like that. At the very least I think more people should recognize that the Chinese government and the CCP are not monoliths, and that the distance between "the boss of the company is a CCP member" and "the company is state-controlled" is larger than what many think.

karmasimida 6y ago

> Also, China is suffering from dollar shortage/flight (foreign manufacturing moving out, foreign retailers moving in) No longer the case after COVID pandemic, Yuan is appericating > The Chinese government doesn't want such a huge financial entity owned by foreign owners Ant had been allowed to exist for a long time, I don't see this really as an issue. TBH, b. is probably the most likely reason. Criticizing governmental authority is a dangerous act even for Jack Ma, especially when your business needs its blessing. Also Ant's IPO had caused quite a lot of controversy even before this, like selling their own shares through Alipay, etc. Anyway, I see this an isolated case, where the CN government wants to give Jack Ma a lesson to put him in place.

beaunative 6y ago

For A, it's not possible to for Ant group's listing to exacerbate China's dollar shortage, as Ant's business is done in CNY and investors would be trading in CNY, at least for it's Shanghai listing.