RECAP: CHINA COLLAPSING?

China Collapsing or Investment Oppty?

NUGGETS OF ALPHA

• Chinese stocks are underperforming U.S. stocks

• China's HY real estate index is down a 82% over last two years

• 98% of ASICS are manufactured out of China

• Apple recently dipped below a key technical level underneath its 100-DMA

• China's local government debt is estimated to be around 53 trillion yuan ($8.2T)

• The nonperforming loan ratios are now approaching 6%

• The collapse of Evergrande two years ago initiated a series of company failures

• Country Garden is facing a debt crisis with approximately $187B in liabilities

• Country Garden bonds are now trading at 10% of their face value

• China has acquired a significant portion of the global lithium mines

• 21% of the Chinese youth are unemployed due to the labor market transformation

• China's currency, the renminbi, has fallen to Rmb7.3259 per dollar

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Believe it or not, a lot of China's e-commerce transactions are food delivery.

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Is China on the brink of a credit event?

• Chinese stocks are now underperforming U.S. stocks by the most since 2021

• China's HY real estate index is down a massive 82% over the last two years, back to 2008 levels (Global Financial Crisis)

• Evergrande just filed for Chapter 15 bankruptcy

• China just "unexpectedly" cut interest rates

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China's five-year performance of large-cap stock is very mixed:

• BABA = -44.56% over the last five years

• NIO = flat

• BILI = +22.82%

• JD = +20.04% (big e-commerce platform)

• SOHU = -50.29%

• BYDDF = +443.63% (EV car maker)

• BIDU = -36.61% (I was an owner of this stock in March 2020)

• BYD = +98.05%

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CATL is the dominant global leader in EV battery production. Companies like Tesla have