I feel like we've been talking about this same story in different ways over the past decade or so. There's always this
great big rolling ball of of of debt of losses when it comes to the Chinese economy. And the question is always where does that
land. And you say ordinary households will eventually have to bear the Francine Lacqua.
Yeah. I think that they should like other East Asian countries in Asia like Japan buy in the countries you have. China has very
high savings rate and also fixed exchange rates. So it's a kind of a
you can patch to the cost to savers through inflation. Because people really have nowhere nowhere to go.
And therein lies the problem. Right because when you've got a closed system there's very limited options in terms of where and
how households can generate wealth. So what does that mean for wealth creation in China. When the property market is losing
confidence when the equity markets is losing confidence and where there are capital controls so what else can they do.
Well I think that if you look at his experience of Japan you know the order departure was about developing the country
building up in the country. So the money ludie one way or another has to go to where the government wants us to like oh
the government wants to build as we speak. Infrastructure projects to boost both the economy and a competitive edge. And
obviously the projects are not going to be have high returns. So so of all you look at the economy it's just you are not going to
have high returns show from time to time. You have financial bubbles there to give you NIKKEI terms. But eventually
everything comes comes back to to land on the ground. And I think the people in China cannot get very rich. I think that it
probably is okay with the government. Actually the company is happy with it. And the. And of course there's been more
uncertainty given the regulatory crackdown that we've seen across China as well. Breaking right now we heard from Alibaba
that they will be applying for primary stock listing in Hong Kong a dual primary. Of course they are the sole listed at the
nice as well. What are the implications of this for the financial markets. So I think that there will be supply issue. I
think it is a spark is already listed over there. It's just. Oh there'll be more supply than the government knows there is.
Financial decoupling between the United States and China is inevitable. And the Chinese the Chinese government government is
doing the first just to to to avoid the shock that it would become eventually. So I think the overall for the market is I
think a scale issue. Oversupply. Do you see more of these moves coming for other Chinese companies as well.
I think a especially with tech companies all need to do list that. I might might though do that in my view. The Chinese
government has decided that decoupling is inevitable. Why don't we do it now.
Andy what does this mean for and financial. Because it feels like the trend towards dual listings and the coming home is
perhaps an effort by some of these diets that have been in the bad books that have been suffering under the regulatory
crackdown to try and align themselves closer to what the party wants. Oh yeah. I think they do. Now they understand that. But
it's not their choice to make. I think the Chinese government is asserting has to be asserting control over all of their capital
markets. And they think that these guys are listed in New York and they're hard to understand what they're doing over there.
It's not good for fall for the government. So are there a lot of reasons for these to happen. They must come in and they must be
obeyed as much as the Chinese government. Just yesterday we were talking about this big story on the Bloomberg Daybreak youth
unemployment and the really falling expectations from young people. The 15 million young people unemployed. How big of a
concern is the broader state of the Chinese economy when it comes to of course the party Congress that we have later this
year. Our economy depends on exports. Exports are still rising at a double digit rate
at your high base of a three and a half trillion U.S. dollars. And I think you'd better the domestic demand. Asia is pretty
sluggish because of as you called it a policy that's clearly obvious. You're not your own fault for youth unemployment. It's
really about expectations. China has a labor shortage because of the labor force is shrinking. The I think the issue is there are
a lot of graduates. We're getting high salaries in bubbles like a shadow banking system or the Internet sector. Now these rich
areas that have really come back to Earth. So that's why I think a lot of people on a petition pointed at to keep searching for
high salaries. They are just not there. And we're looking ahead to the Politburo meeting which is expected to take place at the
end of the month. What are your expectations in terms of economic and stimulus policy. What options remains are
policymakers given that there are so many elements to this slowdown that are structural and perhaps can't be addressed
productively by the usual playbooks. Yeah I think that I think the government will do a lot to do it do some. I think that
there is general acceptance of slow growth in the coming years. So it's not like the government wants to do everything possible
to achieve high growth like we saw before. What I see is this big infrastructure projects like a lack of regional integration
in the cities the smaller cities. Don't have a lot of commendable properties. They are trying to integrate these
cities to Tier 1 cities. So hopefully get the data boosted. Property demand also boost efficiency. So I think that that's a
good idea in my view even though they cannot achieve all purposes. And then there is really no case for tightening up
their property sector. All these buildings are not finished. Some money there to finish them. So we don't have a lot of waste
on a vendetta. I don't see a lot more to come.