so china's communist regime is
ripping into private companies and
entrepreneurship
and free enterprise in general and the
question du jour
is what exactly are they afraid of
so joining me now to discuss host of
america's newsroom my pal sandra smith
reports i used to be the anchor
that's good both great shows
so here's the thing china is now
attacking
all of its publicly owned companies
stock market companies
it's very interesting since this attack
started
since roughly mid-february the ishares
china fund which has all the big chinese
companies uh
alabama 10 cent etc etc is down
24 almost one-quarter loss of value
since she and the communist regime went
on the war path
and they are seems to me
trying to close down free enterprise
what's left of it
entrepreneurial companies and give every
all the credit to these old state-owned
enterprises which is what got them in
trouble in the first place my question
to you sandra smith is
why do you think they are cracking down
like this
because you're seeing what's happening
to their biggest companies they're the
chinese communist party end of day they
want
full control over these companies which
leaves me with more questions than
answers after going through all this
getting ready to talk to you larry
why is it that all of these private
equity firms
american-based see such opportunity when
you know that every dollar you invest in
these companies
you are giving that control to the
chinese communist party
and why have lessons not been learned as
well i mean you you teed up this piece
the wall street journal gets a chinese
education that was in today's paper
washington post just three weeks ago
after the dd blow up after
jp morgan uh and goldman sachs morgan
stanley all launched that ipo for that
chinese
ride hailing app washington post wall
street's finally waking up to the
reality
of china quotes very notable tv people
that you know in financial tv
who were touting investments in that
only then to be left with a complete
wipeout of the company saying
anybody would be an idiot to invest in
these chinese companies so
why are we here three weeks even after
that debacle looking at these
american investors who got completely
tied up in this so about
seven or eight or nine months ago former
national security adviser robert o'brien
and i got then president trump
to sign executive order we banned
the federal thrift savings plan
retirement
any investments in chinese public
companies
and we urged and the movement is going
on with biden
don't invest in chinese companies first
of all they're instrumentalities of the
chinese communist government they can
get any information make them do
anything they want
second of all their accounting is
fraudulent it doesn't meet our standards
so you know to answer your question why
is big shot hedge funds and banks are
financing it
i think they will stop i think this
thing's this game
lessons are learned really yes lessons
haven't been there the problem
is they still see the growth they still
see the trajectory in china
i went back and dug up j.p morgan's
jamie diamond's
annual letter to investors it was
amazing 30 times throughout that letter
he mentioned china that was when he made
the prediction that china will overtake
the us in the next 20 years as the
biggest economy
and financial market in it he said
china's leaders believe that america is
in decline larry
the chinese see an america that's losing
ground in technology
infrastructure and education a nation
crippled by politics he says as well as
racial and income equal inequality
he went on in that letter to say they're
not wrong
this is there is truth to that so you
see the growth
and as you do when you're in private
equity they're wrong
but look china can't keep growing think
of it this way
the reforms market-oriented reforms
allowing an entrepreneurship to develop
allowing a technology entrepreneurship
free enterprise
those are put in by deng xi ping in the
80s
right china bloomed a thousand flowers
bloomed
to coin a phrase what is she doing
he is taking it all back he is reversing
course
i mean it's i'm not i mean he wants to
control
everything he is president dictator for
life
okay get that but what's he afraid of
why does he want to shut down the
entrepreneur who's in control
that's what i think correct i think he's
worried that these companies will
overthrow him
and might even overthrow the communist
regime especially the social media
companies
but the rest of them and then all of
these major wall street firm
firms having such a conscience lately
it's surprising to me too that there
would be this investment in china
considering their human
rights abuses why is that not more of an
ethical
question for these companies at that
point i think that that one is to look
at in the next couple of years they
should be
more worried about chinese communist
dictatorship and ending freedoms in hong
kong and
maybe taiwan and human rights with the
uyghurs
than global warming china is a threat
a palpable threat to the united states
global warming
is an idea and a problem we can deal
with let me just finish off with this
because i think the lessons learned in
this wahpo
piece is fascinating who wrote that i
chose
joshua yeah josh rogan the silver lining
to the dd
ipo debacle he says no more can wall
street pundits asset managers lawyers
lobbyists argue with a straight face
that chinese firms are anything but
under the effective control of the ccp
to your point
that means admitting beijing can squash
them or pilfer their coffers at any time
for any reason wall street must now
acknowledge that the risk of investing
in these companies
can't be known much less disclosed
therefore u.s investors should not be
trusting their futures
that's it china u.s investors should
stay out
of those companies and those funds just
stay out for their own good
forget about the ideological uh elements
for their own
they're down 24 since mid-february
well these wall street touts who tout on
some other networks should be held
accountable
anyway i didn't name names running out
of time sansa smith
i think sandra just interviewed me and
you know what i'm perfectly happy with
it
i'm perfectly happy with it thanks larry
thanks appreciate it very much