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Speaker 1: The joining us now is Ken Pang Pang the Asia

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Speaker 1: Pacific investment strategies at City Private Bank getting the latest

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Speaker 1: on markets, and Ken, thank you so much for joining us. Okay,

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Speaker 1: we saw a lot of the investment houses turning positive

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Speaker 1: on China, and one of the reasons was, of course

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Speaker 1: that we looked like we were reopening. But then the

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Speaker 1: COVID came back and really smacked people in the face.

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Speaker 1: And on top of that, it did seem as the

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Speaker 1: regulatory situation but perhaps over us. And then ant gets

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Speaker 1: and gets slapped by bond billion dollar fine. Now is

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Speaker 1: that good news in the sense that it perhaps draws

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Speaker 1: a line under everything or is it the beginning of

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Speaker 1: another set of regulations and more red tape, et cetera.

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Speaker 1: And antium anti tech news thank you for having me

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Speaker 1: first of all. Um, So yeah, I think I think

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Speaker 1: this probably now slightly positive side on the ant news.

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Speaker 1: I mean, look, okay, we get it right. If you

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Speaker 1: make money from taking money out of consumer pockets, that's

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Speaker 1: politically incorrect. You do too much of it, Um, So

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Speaker 1: we get we get it. Now make a decision. Let's

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Speaker 1: move on, right. I think this is one of those

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Speaker 1: moving on decisions, Um. To to have this fine, and

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Speaker 1: I think, you know, going into one of the biggest

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Speaker 1: markets anticipations is when will end come back for the

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Speaker 1: to the I p O market, And I think there's

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Speaker 1: a high likelihood that it does. So can when you

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Speaker 1: look at let's say other companies on the main land

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Speaker 1: that play in the same space e commerce consumer facing

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Speaker 1: are are you confident on the ability of the Chinese

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Speaker 1: consumer to contribute much to growth or they become maybe

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Speaker 1: a little fatigued from the COVID situation, the property market implosion.

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Speaker 1: I mean, how are consumers on the main land feeling

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Speaker 1: right now? In your view? Well, pretty terrible. I think

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Speaker 1: this uh, this, this this wave currently going on is

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Speaker 1: um is ah, it's pretty pretty negative sentiment obviously. Um.

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Speaker 1: But look, I mean last year, well, I mean this year,

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Speaker 1: consumers contributions growth is what one and a half percent

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Speaker 1: to gdp UM So that's pretty low, right, And even

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Speaker 1: if we just returned to a say three percent type

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Speaker 1: of contribution next year, that will still be lower than

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Speaker 1: what it was in And twenty nineteen was lowest had

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Speaker 1: since ninety seven, right, So so you know, the consumer

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Speaker 1: is very much humbled and if there is going to

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Speaker 1: be more wider reopening. I think there's plenty to bounce

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Speaker 1: back from UM, but you know it's not going to

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Speaker 1: be a very um uh immediate Uh the situation, yeah,

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Speaker 1: kent very very quickly. I mean does it is the

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Speaker 1: bounce back as great as it is in other parts

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Speaker 1: in the world, very very quickly in about ten seconds? Uh? Yeah,

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Speaker 1: I think so. I think it could. It could it

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Speaker 1: could be spreading I mean it could be better UM

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Speaker 1: reopening trade across Asia UM this year the next year

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Speaker 1: as well. Okay, we looked at perhaps some of those

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Speaker 1: regulatory storm clouds disappearing. But you know, the other aspect

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Speaker 1: is we saw out of optimism that it was getting

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Speaker 1: more investable. At least that was the thinking in China.

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Speaker 1: And there's a whole a gamute of different valuation metrics

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Speaker 1: that you can use which would prove that this is

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Speaker 1: very cheap. But it's cheap for a reason, right, and

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Speaker 1: those reasons it's still there. Yes, those reasons have not

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Speaker 1: completely gone away. For example, you know, the Shanghai the

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Speaker 1: new measures in Shanghai and Beijing and a few other

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Speaker 1: cities to to contain COVID. But I think the whole,

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Speaker 1: the whole idea is after the Party Congress, the decision

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Speaker 1: had been made that, you know, restoring economic activity it's

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Speaker 1: a higher priority UM and managing well COVID zero policy

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Speaker 1: is kind of something that they tried to manage out.

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Speaker 1: But obviously, uh, this is a bad time and we're

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Speaker 1: having a global wave and you know a lot of

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Speaker 1: governments are facing trouble dealing with this one. And so

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Speaker 1: so you know, we're not We're not going to see

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Speaker 1: I guess the next step perhaps until the spring UM.

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Speaker 1: But I think the political imperative to UM to COVID

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Speaker 1: zero lockdowns has passed. And uh, and now that there's

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Speaker 1: more focus on the economy, I think that that part

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Speaker 1: we can be relatively comfortable. But so if you want

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Speaker 1: to remedy the situation there, do you use monetary policy

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Speaker 1: to do it? It seems that the PBOC is a

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Speaker 1: little resistant to supplying him more much more in the

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Speaker 1: way of liquidity. UM. I'm wondering whether we're gonna see

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Speaker 1: a lot more in the way of fiscal stimulus in China.

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Speaker 1: What do you think you actually monitor policy has been

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Speaker 1: pretty loose. Uh. Credit growth is actually very robust for

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Speaker 1: all of this year, and and so it's not monetor

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Speaker 1: policy job anymore, I has to be it's not even fiscal,

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Speaker 1: it's it's administrative. Right, So so I think I think

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Speaker 1: the um, the way the fiscal policy can could help

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Speaker 1: is on the property side. Make sure the projects are completed,

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Speaker 1: make sure that's the expectation for additional contagion is stopped.

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Speaker 1: And you know they've gone They've gone a decent way

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Speaker 1: with these sixteen measures of financing for for real estate. UM.

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Speaker 1: But but again you know this, this this has to

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Speaker 1: be done in conjuent conjunction with the with the COVID policy,

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Speaker 1: and um, you know there's something lays here. So so

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Speaker 1: I think the initial uh you know rally has been

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Speaker 1: about uh, you know, reversing the excessive bearishness in October.

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Speaker 1: Now we need to see more proof that the results

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Speaker 1: are coming in. And I mean you're finding, you know,

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Speaker 1: from as a private banker, getting more inquiries from your

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Speaker 1: clients here about what they should be investing in China

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Speaker 1: rather than should I invest in China? Yes, there's definitely

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Speaker 1: more inquiries about that. UM. I think, well, there's two camps.

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Speaker 1: One is that you know, is it time to to

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Speaker 1: sell the rally? Um? And we think the answer is no, UM,

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Speaker 1: and the other camp is you know, what can we do?

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Speaker 1: I think, you know, the the safer bed is still

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Speaker 1: basically industries that are consistent with national policy towards technological

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Speaker 1: self rely is right. So I think those are UM

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Speaker 1: things that we're focusing on it. One of the things

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Speaker 1: that we've been describing after the Party Congress is this

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Speaker 1: lack of intellectual diversity within the opera echelons of the

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Speaker 1: Chinese government. And I'm wondering whether you think the lack

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Speaker 1: of UM, maybe I don't want to say necessarily contradictory voices,

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Speaker 1: but certainly voices that can challenge conventional thinking. I mean,

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Speaker 1: it seems like there's so much like mindedness right now,

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Speaker 1: and I'm wondering whether or not you think that's going

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Speaker 1: to hinder overall growth in China. I think I think

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Speaker 1: I think you will. UM, the longer term view has

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Speaker 1: probably broader out broader potential outcomes now. UM, But I

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Speaker 1: also look at it this way. The number of people

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Speaker 1: with advanced science and engineering degrees in the two five

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Speaker 1: member Central comedies has I think it's gotten so, so

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Speaker 1: that's UM, that's an interesting, interesting and consistence UM. You know,

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Speaker 1: outturn compared to what this national goal is in quote,

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Speaker 1: you know, in terms of trying to achieve more technological

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Speaker 1: self reliance. Ken thank you so much for joining us.

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Speaker 1: Ken Punk The uh there, you're just having a look

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Speaker 1: at China markets. He's any specific investment strategist,