53: To Allocate or Not To Allocate? Investing in China in 2022 - Roundtable Special

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In a first for the Money Maze Podcast, this episode brings together the perspectives of 3 China experts to discuss the economy, public equities and private assets. 

The three guests are Chingxiao Shao, CEO of Red Gate Asset Management, Ron Cao, Founder & Managing Partner of Sky9 Capital, and Chi Lo, Senior Economist at BNP Paribas.

The objective in this podcast is to explore the investment opportunities available in public and private markets after a year in which rising political tensions and government interventions have brought about a sharp bear market. 

The conversation begins with a review in which it is clear that the Chinese central bank has not resorted to debt monetisation on the scale of the Fed, whilst China still enjoys huge trade surpluses, unlike the US with its large deficits. We discuss the implications of this for Chinese fixed income products and the currency. 

We then move to questions about the importance of the private sector to the Chinese economy and examine whether new regulations which have led to sharp declines in headline names and sectors suggest anything more insidious.

From there, Ching discusses the opportunities in public equities, Ron covers VC and Chi provides context and warns of the dangers of viewing Chinese assets through an exclusively Western lens.

The discussion reviews the very large buybacks seen in Hong Kong by many corporates and their owners, the valuations and opportunities, as well as fault lines and red lines that Ron, Ching and Chi believe are important.

Finally, we discuss whether Chinese assets may actually offer country diversification, given their evolution and the different current monetary stance.