Is it just me or are Indians oddly obsessed with white people?
Chinese Economics Thread
- Thread starter Norfolk
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Banks aren’t investing in the equity portion of a corporate capital structure - regulators would lose their shit. Banks will invest solely in the debt portion of a corporate capital structure. Though herein lies the problem: for companies that are asset-light (ex., software and biotech), they lack collateral for which a bank can lend against so absent equity markets, it’s very difficult for them to have funding to start developing products
The top 10% of income earners in the U.S. is ~135K. It’s would not at all unusual for a white collar professional with a few years of work experience to be near that level and said “the rich” people would be normal people with a 401(k).
Outside of that - all stock markets create value for society. Companies need to fund their capital purchases (ex., facilities and machinery) before they start generating cash flows and there are generally 3 ways to do this - retained earnings, debt, and equity. The stock market connects savers with corporates seeking equity funding for their capital projects.
That being said economic growth and equity returns tend to be uncorrelated, since there are many many many other determinants of the values of discounted cash flows of a company
Asset-heavy capital projects including infrastructure and urbanization are more suitable for bank lending than asset-light capital projects because bank downside is limited - the collateral value of the assets limits substantial downside risk. However, for asset-light businesses (software publishers, biotech, fabless semiconductors, etc) - esp. in the early stages, there won’t be much debt financing available to them, the only part of the capital structure ppl would be willing to invest in is the equity later and hence why for basically all asset light companies, equity is much larger in the cap structure and access equity markets; either from hf/vc/PE or through public exchanges is important.
The railroad reference is quite silly - it’s an edge case of edge cases; the U.S. is the worlds largest importer, 2nd largest exporter - that simply doesn’t happen without a safe and efficient rail network.
and of course, this is distracting from the original point. If China were indeed more economically powerful than the U.S., US politics doings shouldn’t be affecting substantially, asset prices in China. But they are. But Chinese politics doesn’t affect substantially, asset prices in the U.S.
Lol tell me you have no experience in academic and scientific research without telling me that have no experience in research.are they quoted from other Chinese research papersHow are these quotes counted and where do you have this info from? Here is one nice article about the quantity..
“To survive in Chinese academia, we have many KPIs [key performance indicators] to hit. So when we publish, we focus on quantity over quality,” says a physics lecturer from a prominent Beijing university. “When prospective employers look at our CVs, it is much easier for them to judge the quantity of our output over the quality of the research,” he adds.
You are aware that western universities and academic institutions do the SAME thing.
There are frequently high profile retractions in western research as well. Does that mean they are junk? Your hypocrisy knows no bounds.
I agree. A functioning equity market is important for a healthy economy. The CPC shares this opinion and that is why they set up the Beijing Stock Market and the STAR Market in recent years.
This is a fascinating topic that requires more discussion. From 2007 to 2016, S&P 500 companies spent 96% of their net income on stock repurchases and dividends. If you consider equity issuances (selling shares), then net shareholder payouts (stock repurchases + dividends - equity issuances) only accounted for 50% of the net income of S&P 500 companies during the same time period. Naturally, there's a limit to the number of shares you can sell before you lose control of the company.
Source:
The extent to which this has impacted the ability of American companies to innovate is up for debate. However, I wouldn't be surprised if the large amount of money that American companies spend on stock repurchases and dividends is at least partially responsible for the fact that Xiaomi, despite earning less than 3% of Apple's net income in 2023, produced an EV before Apple.
I agree with everything said here but there are 2 qualifiers that should be considered
1. If companies don’t pay dividends and do share buybacks and thus aren’t able to sell equity, the alternative for them would be to issue debt. But debt has its own cost - namely interest.
2. Cash from dividends and buybacks isn’t dead cash, it’s being used to invest in other companies
So? Not sure what your point is.
If that stock is down, you can find a lot of examples of that worldwide.
You may know a lot of things, but one thing you do not know, and that is you know very little of China, and even less of Hong Kong, where a lot of us here are from.
There are four pillars to the Hong Kong economy. Biotech is not one of them. Financial industry, tourism industry, logistics and services, that is the Hong Kong economy.
You are bashing Hong Kong on the performance of one stock, that is not even part of the core economic drivers to that economy.
What are you even talking about?
Janet Yellen wants an audience with the CCP so to receive assurances that nothing drastic will happen to US debt markets.
Enough said.
China holds <5% of total U.S. public debt outstanding and its declining every day. China’s total treasury holdings are equivalent to one day of treasury trading volume
Most commodity future contracts traded on future exchanges are not for delivery, I think it is like around 1% is actually exercised for delivery.
So?