Recently, I discovered something that made me more concerned with Japanese corporations.
as if I didn't have enough reasons already
Softbank, the 2nd biggest company in Japan next to Toyota, is a holding company that focuses on buying company stocks/securities and investing.
They're like Berkshire Hathaway but more Jewish. Softbank has massive funds that they manage, most of it is in something called the "Vision Fund". This company has been investing heavily in Chinese tech due to how cheap the stocks are, the fact that its been developing rapidly already and the consumer base size. For instance here's some statistics on this:
>SoftBank led $500M investment in Didi in China’s biggest autonomous driving round
>Softbank holds a 25% stake in Alibaba, the Amazon equivalent in China and one of the biggest companies in China. for reference the 2nd largest stake in alibaba is some chink with ~11%.
>Softbank holds significant shares in several Chinese stocks across various industries
>Barely any investment in Japanese corporations
>Whats wrong with Chinese investments? Theres a ton of money there, he'd be stupid not to invest there!
That's where your wrong. With China, you always lose in the long game. It isn't like the US or other countries where you both win, China is looking to make this a 1-sided win - aka if their own security or strength is threatened they will destroy a company or companies overnight. This includes foreigners as well.
Furthermore, not only are you dealing with the enormous presence of the Chinese government, but you are also dealing with a race of people that are notorious for stealing IP, theft and deception. Working with them, you have no idea what they will do to you and theres no safeguards in place to help you.
I'm not even going to get into the weak, spineless Chinese customers that will throw you under the bus for the slightest offense towards China
In the Evergrande situation recently, years of auditing failure prevented them from being defaulted years ago. Why did it continue for so long despite people knowing already Evergrande didn't have the assets to pay for their liabilities? Its because the government allowed them to continue to do business because China has to catch up to the US by any means necessary, even if it means investors lose out on billions of dollars. The very concept of profitability in China, as a result, is completely meaningless. With China, you lose.
>What does this have to do with vidya?
One of the biggest holdings in Japan doesn't even fight for their companies. There's a reason Tencent and other Chinese companies have been able to eat up other gaming studios so easily - its because they have the capital to do so. Where is this coming from? Foreign investment into China and/or government intervention. You can argue that Xi Ping does take the money back eventually through "social redistribution" but it doesn't negate the fact that they have enormous amounts of money.
>Isn't Softbank investing everywhere? Its not just China.
In recent years their sights have been set on China, the US investments like DoorDash and Amazon stakes are really just safe bets to prevent complete collapse if their China bet goes under. Afterall, they will readily sell their US investments to offset losses from their Chinese ones, never the other way around.
tl;dr - Japan has either lost faith in their own businesses or is motivated by pure greed that they are jumping headfirst into Chinese markets despite warning signs and the consequences this would have on Japan. China is not worth the investment, and this will destroy Japanese markets in the long run.
Sources:
>Softbank Investment Tracker (Doesn't have all the stocks, but gives a good general picture)
https://archive.md/U67Eq
>(((WSJ))) on Softbank chinese stakes
https://archive.md/D0soy
>(((TechCrunch))) Softbank stake on Didi
https://archive.md/8vtwI
>Investopedia - Alibaba shareholders
https://archive.md/V6x1r
>(((Bloomberg))) - SoftBank to Take ‘More Cautious’ Tack as It Cuts Deals in China
https://archive.md/NlUc6
> (((Bloomberg))) - Japan Game Stocks’ Plunge Show Their Exposure to Chinese Regulations
https://archive.md/TQ7jL