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on one nation for comfort. And later we'll speak with Juli Ran and China system of taxation, But first to the markets, and John alters this cautionary tale this week. Essentially he says, but where the barrage of predictions for three flooding or inbox right now? And John joins us. Now, John, we come to the Roman calendar year end with a bunch of assumptions, including that there's often a so called

Santa Claus rally and so on. So let's first ask what does actually happen in terms of things like position squaring or profit taking or loss harvesting that we should be aware of in the run up to December thirty one. Well, it's it's often known in Britain as bed and breakfasting, the idea of taking losses to give yourself an allowance to maximize your ability to offset capital games. There's a lot of people have taken a lot of losses this year.

You might well find that there's some confusing activity when that happens, and there's window addressing when people want to end the year with portfolios that make it look like they've been smart buying into stocks that have done well, even though it's almost exactly what they shouldn't be doing.

It's difficult to work through exactly what that's going to imply for this year, when frankly, there was almost nothing you could have been in that would make you look smart, and it would be a great idea to prove that you were in cash at the beginning of the year. You don't really want to be in that position now. So it is going to be a strange final months

of the year. And next week we have the final inflation numbers, followed immediately after by the f O m C. I suspect that's still overshadows absolutely everything else and wild in the foreseeable future, I imagine that will trump any of the excitement that would come with the end of the candy right, and we're actually almost lucky that there are still catalyst or it will be quite the long December.

But something else that happens from early December usually as we get analyst predictions, huge long research notes outlining cell side assumptions for your head and predictions. One of the wilder predictions that did catch by. I don't know how many I've been through, but yeah, this is the time of year when you get a lot of predictions that The good side of this is that it's a very good discipline to force yourself to sit down as a piece of paper within a spreadsheet and come up with

a clear prediction. There's no question that that's a good discipline. Just like a college, it's a good idea to actually have to write an essay or whatever. Actually publishing what you're expecting and what your assumptions are is a good idea, and a lot of the research that people produce at

this time of year is pretty interesting. It's worth finding a way that says there's almost no point taking any notice at all of what they say for their final numbers, particularly for the stock market, because the stock markets on a year year basis is incredibly difficult to predict, and it tends you know the stock market rises by an average of seven or eight percent a year over time. It's very rarely rises by seven or eight percent in

any one year. Tends to be up in double figures or very occasionally take a big ball, but it's unusual to get a year when it just gains about seven or eight percent, even though on average over the very long term that's what you can expect to get. But there is some usefulness to your head prognostications though, right even if it's only to knock people out of habitual thinking. I certainly agree that it's worth thinking through what you

really believe. It would probably be more useful to try to come up with predictions five or ten years hence, which are impossible obviously so many unknowns. Once you've begin to go out further into the future, but you then have a much clearer scenario analysis, and you have much more of a grasp of what you see, both the risks and the opportunities. Being the long view move into

the future. It's a cliche, but it is true that the more likely that the stock market is going to do well for you, but you still need to work out what criteria will determine exactly how well it does. Meanwhile, the fascinating thing wrote up with some research from Jannis Henderson is that analyst the pretty good at predicting how much of companies will earn, what their profits will be,

and for one year that is almost useless. So this year was all about a fall in pe ratios, which almost nobody predicted, and earnings growth has been fine and almost exactly an a lot of people predicted. Doesn't help at all explain what's happened on the market this year or predict what was going to happen in the right And that's a real question. Has this year been an exception in terms of sharks or black swan events or our so called longer term trends still intact. My best

guess is that it's probably a regime change year. I mean, the regime that started to change in It was obvious that something was going to give, and we've finally seen that this year because inflation really is back and the correlation between bonds and stocks is breaking down. So a lot of those assumptions finally got shaken this year, and that is one of the interesting things about looking at

all the research. Incidentally, there is more dispersion than there usually is, meaning that you know, there's greater uncertainty and people are admitting to greater ansepty because a lot of

reliable models for the last twenty years aren't working. On top of that, we had one very major bona fide shock, which of course the invasion of Krane, and frankly a shock that wasn't so much less in economic terms, which as zero COVID in China, that when everybody thought the pandemic was pretty much over, China suddenly started seeing it's ekond of be being far more affected by it than

it had been before. So those are very major shocks at the point when the regime appears to be changing anyway. So this has been a very unusual year. We do seem to be having many of these unusual years and in the most recent decade. But John, even if you knew what was coming for sure, even if you're absolutely guaranteed that something was going to happen, would guarantee us

a better return. It's not necessarily the case, isn't. No. I mean, if you've already discounted the good news ahead of time, then just as well that the good news finally materializes. But it doesn't particularly help you at that point. Even if you know what's coming, if the market is wildly overpriced is predicting what's coming, you could still come

a cropper. You not only need to know what's coming, you also need to work out how well the market disposition for it, and if things are bad, you also need to understand what the systemic might be. So many of the other very interesting example this year, it's not a true Black Swan event because I don't think crypto big enough, but some of the horrors in crypto were very major, significant deals. And obviously because it's crypto, which has only been around a little bit more than a decade,

there's a lack of precedents for it. Luckily, would appear that crypto isn't linked enough with trag fi as we have the traditional finance that it's going to cause a systemic events in itself. So John, given that the new Year that that we know and love or hate is not the new year in every geography or market, how do other markets do over US holidays? That's an interesting one. Thanksgipping can create some very weird dynamics in the rest of them because there's no real holiday at all, and

it's complete shutdown here in the States Christmas. It's interesting almost the other way that Europe really does just go into complete hibernation for a whole week, and the US, despite being a more religious country in many ways, doesn't take Christmas so seriously. Yes, so you do get some very strange effects that way. In general, anything that's happened in the last two weeks of the year, though, is so likely to be driven by load liquidity that it

can really alter perceptions in a way it shouldn't. And also the fact that you mentioned China earlier, we have another New Year coming up in a couple of months. Times, well, the Chinese New Year really messes things around. You have to any Chinese daity, you have to start applying moving averages to and stuff, or otherwise you just can't quite see what's happening because of the big shift caused by

the moving lunar new year. Yes, you mentioned how Jannis Anderson had talked about the dispersion in predictions this year. One prediction you point out that seems to be almost a universal article of faith, and that's a quote from your column, is that the US will fall into a recession. But you point out the amount of vocabulary being used is hilarious, you know, playing villain a garden variety soft dish. But one phrase stood out to you, and that's rolling recession.

It sounds very ominous. Explain what it is. I'm not I'm not sure that this is from ms and Saunders some ways almost moderately positive in the ideas that there's been a succession of different sectors that have felt the problems in turn and others that have done relatively wellness and results. That's in part because the initial pandemic had such differential effects, much bigger impact on some parts of the economy than those oil prices. The last pay checks

are now actually down for the year, incredibly. It's possible that energy, which has been one of the factors that has kept everybody else the loft, is now going to be under performing and that that will help other factors. That's the notion of the Roding recession is that following the very unusual circumstances of pandemic, it will be an unusual recession which it's particular parts of the economy particularly badly at different times, but spares others at different times.

So all we have to do is make sure we pick the right parts of the economy to exactly at any one time. Yes, Bloomberg Opinions, John Authors, stay tuned. Stephen mim next on the outlaw status of the Bahamas HQ two fd X in a long line of opaque enterprises. This is Bloomberg Opinion. You're listening to Bloomberg Opinion. I'm Vonnie Quinn the Bahamas. Who wouldn't want to be headquartered there? Work there, commute to and from that beautiful island nation.

And yet well, let's pause for a moment and bring in Bloomberg Opinion columnist and the University of Georgia professor Stephen mim So. Stephen, Obviously, the reason we're talking about the Bahamas is it hosted the headquarters of Crypto Exchange f t X, which obviously imploded in recent weeks. We don't even know the extent of the damage caused by ft X and the associated Alameda. You say, though, that the first red flag came long before things like opaque

balance sheets and oddline items. It was actually the fact that the HQ was the Bahamas. Why is that? Well, you know, the Bahamas have this longstanding reputation which is arguably quite deserved of being somewhat loose place legally, a place that really likes to tolerate. It has for decades tolerated so fairly shadowy banking operations and also very kind of fly by night financial operations. It has regulation, but they are not capably ministered at least haven't been. That's

gotten a very bad reputation. Now is this something that a particular administration has guided the island towards or is this something that's been true of the Mohammas since the

founding of the island nation. Well, you know, in a way, you could argue that geography is destiny on some level when it comes to the Bahamas, because it's incredibly close to the United States, so it's very convenient, but it's also operating completely outside of its legal shadow So um long ago, centuries ago, it was a center for piracy and people sort of operated there with community, even though it's a British colony basically kind of run by warlords

Thomas Um. But later it became place to run guns during the Civil War and then during Prohibition. That's really when it's story really takes off. The white former kind of planter class got into rum bootlegging and shipping run and that seems to have created a kind of ethos on the island among the white ruling class that tolerated well, in that case, illegal operation. But that continued decade after decade. You know, in the nineteen thirties, as provision ended, it

went into tax evasion. It became the go to place for evading high income taxes in the United States. And that's just kind of percolated. No, you say geography, but also I guess it's just out of the reach of other regulators. Can other kinds of authorities be involved when it comes to something like crime or shadowy behavior? I mean, could somebody be extradited from the Bahamas for example, Yes,

there are tradition treaties. The bigger problem is the sharing of financial information and the Bahamas selective refusal to do so with other nations in a kind of reciprocal way. You know, it's gotten a lot of attention, negative attention, or being a place where you can have offshore bank accounts that are unregulated and untaxed, and you know, they've gotten a lot of pressure to comply with international regulation, especially after the year two thousand and because they were

put on a blacklist. Basically that made it clear that you shouldn't do business with them. And so since that time they've sort of grudgingly cooperated, but they've done so through this rather clever way of saying, yes, we agree to share information. However we're only going to share information, say with the Cayman Islands, We're not going to share information with the EU or what have you. So it's like, basically they're cooperating with other tax havens, but not with

core economic centers at the global financial system. Well that's fascinating. I mean, is there competition between tax havens? Then yes, there is. Actually it's kind of you know, it's like a race to the bottom. You know, remember the Panama papers. You know, Panamas is a place that Switzerland is obviously

has a very different reputation. But then you have a lot of these other typically former colonial possessions now independent nations manual out to other South Pacific uh, small nations that have become places for this sort of offshore banking. What will change it? Because you know, we think of the Bahamas is this beautiful island nation. I'd love to work there, you know, you'd love to work from there.

It'd be an easy commute. Would the Bahamas ever want to become sort of on the up and up as opposed to a place known for the fact that it has a little bit of an outlaw status. Well, you know, I think there's obviously a downside to the crypto implosion taking place within the Bombas and this doesn't give them

a lot of credibility. And but it would be a very hard habit to shake, and historically has a lot to do with the relationship between a ruling class that has had a lot of involvement in very clandestine or shadowy things, and that's probably a very hard habit to break. It's changed a lot, obviously since independence in the nineteen seventies, but a lot of the original players they're known as the Bay Street Boys, which makes it sound like they're like a K pop band or something, but they're is

the easy exactly. But these are like people of British descent who ran the islands for decades and cut all sorts of corrupt deals with organized crime and the like. And I think a lot of that still carries over and probably paved the way for when Crypto made its appearance. Like you know, here's a new kind of financial speculative entity that's unregulated. It's like, let's, you know, someone in

the Bahamas, and they did. They really made a push for this, like let's bring crypto to the Bahamas, and they succeeded. Unfortunately, that's still very much in play of kind of like do you need a charter? You know, like and also conversely, interestingly enough, historically denying people charters people who come in and like someone else's Meyer Landsky mob figures like you're not letting them in and they can't build the I mean, the casino stuff is the

whole awesome side of this. There was a great story this air to the Amp Fortune went in and tried to build a casino and keep built it on an island off of NASA, and then the Bay Street boys were like, now, like, you're not going to be allowed to take a boat out basically, I mean, it's bad for him. He got Bahamas blocked, Yes, Bahamas blocked exactly. Yeah.

I mean, you have a column out that details some of these stories, and some of them are incredible and very fascinating, the type of thing that you know, we all love to read. But at the same time, often these things end very badly for a lot of people, as the ft X history is going to for a lot of people as well. What's the future for the Mohammas. I mean, the fact that a company is headquartered to

the Mohammas. Is that enough to suggest that there should be a red flag or there plenty of companies that are completely transparent and operating completely in the open that are based there. There are legitimate companies that are based

in the Bahamas, for sure, absolutely. What's troubling though is the number that are not so legitimate and have been you know historically this is I think less of a problem now, but in the nine seventies, for example, the late seventies, there were three hundred banks of the Bahamas. There were more banks than bars in the Bahamas, and the vast majority of them what are called like suitcase corporations. They were effectively a post office box and nothing more,

but they were obtained a kind of bogus charter. So the problem is that while there are very legitimate businesses in the Bahamas, I have no doubt the damage that it does to those businesses to be in the same place as these other businesses is really unfortunate and I think then that goes to your question actually about like what is the future Bahamas, because it's like guilt by association, which may well be unfair, but that probably then has

an unfortunate consequence on future development. I mean to some extent, I guess I or anybody wouldn't want to judge the island nation given that it needs tourism. Absolutely, I suppose the easy way to ask it, can we blame the Bahamas? No? And this is really what I've written in Certainly the reporting on there's the Bahamas really should not be blamed so much as Sam Bankman freed his associates and f t X, which were clearly operating in ways. You know.

The The interesting thing though is for outside investors, the decision will locate there. You know, it should have been something that might have might have indicated that there could have been something because they since there is this history of not really asking to question when someone sets up financial operations in the island nation, and as it turns out, those fears would have been entirely justified about f t X. If someone is coming too who says, you can't see

our balance sheet. We're based at the pomise like it's like, good Lord, you know, maybe you want to look into that. Bloomberg Opinion columnist and University of Georgia professor Stephen Mim you're listening to Boomberg opinion. I'm Vonnie Quinn. Kazakhstan reelected its incumbent president last month for the next seven years. President Okayev will run the two hundred billion dollar economy

and the world's largest uranium producer. Now. Kazakhstan chair is the second largest border in the world with Russia, after the U. S. Canada border, and this is where things get complicated. Relations have been a little strained, to say the least, since Russia's invasion of Ukraine, which TOKAIV does not support. Bloomberg Opinions. Savid Fickling has been examining how countries who need uranium on their way to zero carbon power need to start figuring out their supply chain now

or uranium might be the next critical mineral crisis. He joined us for a conversation. When we talk about uranium, I guess most of us immediately think about nuclear power, particularly after the experience of war in Ukraine. Though atomic energy is now not destined for extinction, so explained to us who were depending on for uranium and also uranium oxide,

the material that's needed for nuclear power. Yeah, so I mean uranium oxide is the hided material that is produced by mind and events have further refined and produced the nuclear field that's actually put into nuclear path plants. Let's bear about about three quarters of nuclear generation happens essentially in our E C D countries Europe, North American developed ASA.

That will shift a little bit to as we see more nuclear plants switched on in places like China, India, But essentially three quarters of nuclear generation is in the rich countries. But those countries there are allies, only provide about of the uranium that's actually needed to fuel those reactors you need each year about seventy five thousand tons of uranium side roughly two thirds comes from China, the former Soviet Union, around and Pakistan, essentially countries that are

not well aligned with those rich countries. And as we look at the problems in twenty two of being dependent for fuel on a country with which you're not aligned geopolitically, we need to think pretty hard about the fact that the same situation prevails with uranium, and particularly a huge proportion of the world's uranium comes from just one country, Kazakhstan,

and Kazakhstan's diplomatic position is quite an interesting one. It's become more interesting in twenty two They seem to have been wanting to be rather more independent of Russia than they have been historically. But if you just look at the position of Kazakhstan on the map, it is very hard for them to carve out a policy that's truly independent of Russia and China together, because they are sand

much in those countries. David, how far out is uranium traded and how is it even traded as a contract. It's not an established and liquid futures market, and even pricing for uranium tends to be from sort of private sources. There are no widespread futures contracts in uranium. Having said that, there is a very clear idea of long term costs, and this is actually one of the reasons that you see Kazakhstan has become so dominant as a producer of uranium.

Thirty dollars a pound is a sort of benchmark price for viability outside of Kazakhstan. Most production costs considerably more than that, and of course, if you think Back in the history of this in the two thousands, it was not expected that wind and solar would take off the way they did, so uranium was seen as a future that a lot of investment went into places like Kazakhstan.

And then eleven you have the for Kushima disaster. Atomic generation plummets and prospects of atomic generation plummet even more so a lot of that investment was basically burnt, and what was left behind was Kazakhstan is the cheapest producer in the market. There are a lot of other projects out there that have been mapped over the last thirty fifty years. People know the uranium resources that are there,

but it is not economic to mind that uranium. I was speaking to a produced a rare earth in Australia here and they have a project called Nolans in Australia which is a rare earth project. Rare Us often occur in combination with uranium. Back in the two thousands, they said, well, we can produce rare us and we can produce uranium.

We can make money from each thing. Now that uranium is seen as a waste material, and in terms of when they're making their pictures to investors, The questions are not how much money can you make from this uranium? It's how do you deal with the cost of this worthless uranium. It's essentially there because there is so much low cost production coming out of Kazakhstan that more marginal projects elsewhere in the world are just not viable. But let's just have a think about this in combination with

what's happening in twenty two. Of course, we're now all saying, gosh, Europe made a big mistake in the eighties and in the nineties two thousands by becoming so dependent on Russian gas just because Russian gas the cheapest source of energy. Were really seem to be making the same mistake here with uranium. There's an unreliable supply chain there for uranium.

If we actually want to unlock a more reliable supply chain, we need to have higher incentive prices, and that's going to mean we need more development of nuclear power plants to increase demand in the market. Tell me a little bit about storage. Can you store uranium for the long term? Well, I mean, obviously, an overarching issue we've had since the start of atomic energy is how do you deal with

nuclear waste? Of course, but in terms of nuclear fuel storage, you can store it a bit and most nuclear plants, well all nuclear plants will have a storage facility on site for nuclear fuel that's not yet being loaded into the reactor. You reload the fuel like a cold plant, where you're putting it in all the time with newclear fuel. Every eighteen months or so, you replace about a quarter

of the fuel that's in the reactor. And the fuel comes in the forms of these fuel assemblies, which are a series of rods which are kept in a very secure facility on site. They're moved from that fatility into the reactor and that's a process that goes on continually. It's a a very slow refueling process, but it is essentially a reviewing process. The organing credits to the Simpsons. Yeah, exactly exactly. But obviously you can't keep unlimited quantities of

that fuel on site. You have only sort of limited capacity. There are a lot of things that need to be done at a nuclear power plant, so there's a limited space for that. And of course anywhere we are handling nuclear material there is a perforation risk. So it's not like nuclear plants can stock up for the next three decades. With all of the uranium they're going to need, there's always going to need to be a supply chain going from minds to nuclear power plants to waste facilities. Yeah,

this is a bit of a conondrum. I mean, on the one hand, you have political factions in many developed countries fighting against atomic power, for example the Green Party in Germany which didn't want an extension to Germany's nuclear operating licenses. On the other hand, you've countries such as frans and raising nuclear completely and even Japan after for Kushima.

I mean, I think the expectations should be particularly in Asia, a lot of these plants have been set up with in the last ten years, so they will operate for likely fIF the years without problems. In developed countries where the fleet and nuclear plants is a lot older, I think that question is still up for debate. You know, the real factor that's actually dealt a blow to atomic

energy over the past fifteen years. Certainly a green politics in Europe plays a part in this, but I think the biggest factor is the extreme difficulty of building nuclear plants. Billions have been spent on plants that have never been developed, and particularly we saw sort of further blow dealt to that by for Kushima. Now the thing that gets talked

about on in this space is small modular reactors. This is the idea that you could build much smaller plants, much more of them, the sort of factory building production line type benefits. So what happens to geopolitical alignment? As you say, I mean, how should countries think about this going forward? Yeah, Well, I said earlier that the diplomatic existion of Kavakstani is a very interesting one, and I think you know, we're seeing everywhere in the former Soviet

Union and outside of Russia. There are some interesting developments happening in that periphery in terms of governments being much less willing to do Moscow's bidding. But I think if you think of really long term geopolitics, you think of geography, and Kazakhstan, as I say, is landlocked. It's landlocked on

most sides by China and Russia. On the other side by Iran and by Afghanistan, and there's a small order through Turkmenistan and aster by jan In terms of getting nuclear material out of Kazakhstan, if you do it by road or by rail, it has to go through one of those countries. Even if you do it by air, generally it's not flown by air because of course there's

greater risk around. Carrying things like that by air technically would be possible, but of course even as air space is circumscribed by those countries, so in less the geopolitics changes, then the reliability of Kazakhstan as a source for most of the world's uranium is going to be contestal. And that's why, you know, I think if you go back to the era of the Cold War, if you go back to the seventies and eighties, something like the US,

it was actually self sufficient in uranium. A vast amount of effort was put into ways of producing uranium from domestic fosse fate reserves and things like that. Really there is no domestic US production of uranium. Now there's a little bit of sort of reprocessing and things, but of

fresh mind uranium, there is none of it. That is the sort of thing that if you were talking about a future of real geopolitical cultural style grade power attention, which is, you know, if you're a military planner, that is the sort of thing that you are thinking about.

After the events of two then you really have to be thinking about, well, how do we have resources Australia, Canada in those nations more reliable allies, Yeah and so on that then, David, what price would uranium need to go to in order for there to be more production? I mean, if there was a doubling advice, would that

cause problems worldwide? Or it wouldn't really cause a problem for nuclear power plants the atomic energy sector as a whole, because essentially all the cost of running a nuclip plant is actually building the plant. Prices above fifty dollars a pound, and especially long term prices about fifty dollars a plan, they would start to change this picture quite significantly. Plenty of miners are sitting on uranium resources which they regard as waste because they can't get a good enough market

price for it. Prices significantly above fifty dollars a pound would really start to have people going back to their spreadsheets and their mining essays and working out what they could do with that. But it has to be not what we'veing At the moment. We see a clear sign of short term prices spiking well above flat level. The thing that's going to make a minor sit up and take notice. Is long term pricing, which is different and frankly is hard to calculate with a fairly i liquid

commodity like uranium. And it would really come down to if you're an offered a nuclear power plants, do you actually go a little bit like we see Hesler going to someone who operates a cobalt resource and saying, I want to buy your cobalt. It would similarly, I think require atomic energy utilities going to uranium minders and saying I want to buy uranium and I'll unlock it at this price. It's such a small or any liquid market

that it really needs that producer to consumer contact. Were unlikely to have a sort of liquid futures market that would actually represent that numeral opinions. David Fickling to China now and its fiscal position, COVID zero was obviously drained public confers. The deficit in the budgets for all levels of government in fact is nearly triple what it was

this time last year. Incomes her down due to tax breaks for business and land sales have slumped to spending, of course, has also spiked to pay for lockdowns and COVID testing policy. Banks, apport and bond issues. Will they haven't filled the funding gap. I spoke with Boomberg Opinions Shuli ran about how China approaches taxation. Surely, how do you see China developing its system of taxation over the next year or so? Will new taxes be created in

order to deal with the fiscal problem? Actually, just explain how taxes are designed and collected now in China. I would say China's physical system is very cool. The government is not good at collecting taxes, unlike the U, S, I, R S. So like, for instance, China don't having Rican text, hardly has any property tax. There is definitely no wealth tax, even like a corporate tax. Companies are quite good as

using accounting gimmicks to avoid corporate tax. Yes, there has been a lot of speculation of Chinese government implementing inheritance or wealth tax, but I think that actual implementation would be very difficult because they have to somehow find people who know how to calculate They then near wealth, right.

I think they're better off just lasting onto those big tech companies JD dot Com, n or Ali Baba and say you provide employment, you provide social benefits for your employees for the local governments where you do business, because that's just easier than like tracking down individuals and high network families. How scared are the ultra rich in China? You mentioned in your column that after the Party Congress and President Chies and things speech, the rich got a

little nervous. And China does have a system where you can renounce your citizenship. Obviously, if you can get citizenship elsewhere, would they have to pay an ex attack so to speak. Yeah, there is this speculation right now. The speculation is that China is going to follow the US system in that Chinese citizens at taxed worldwide. Right, so even in Hong Kong,

I know it's business. They Hong Kong's global investment banks, they have been asking their employees of Chinese origin if they have the Chinese possible because they have to do the tax it holding, So they are quite nervous. And then the idea is that maybe when they China will also install an exces tax. And that explains why Singapore

is so hot these days. If you go to Singapore, there will be a lot of which Chinese because Singapore doesn't have any inheritance tax, didn't have any wealth tax, and then it's been kind of culturally close to the Chinese society and a lot of very wealthy Chinese have moved there. Do you have any numbers on how many billionaires are in China and what kind of percentage in tax they do pay to their local municipalities and elsewhere. I think the bilitaires don't pay very much tax, just

like the U S tax billionaires. They don't pay much tax, right, They don't pay themselves any salaries. They basically use their shares as collaterals to take her margin loans and I think it's a very similar system in China. So in that sense, they don't really pay tax because they don't really have income shuty. You mentioned that she pivots fast from week to week. We saw presidentcy make a huge

pivot in terms of the COVID controls. Does that mean the president she is watching the markets as closely as we all are. I don't think he watches market, but he says watched his own fiscal conference. He watches his own wallet. And then what we have seen with the UK and what happened to the guilt market is that globally all governments start to have to worry about their

fiscal responsibility and discipline. Right, and then like, because of this COVID control and the very stringent developer and tech crackdown, China is running its biggest ciscal deficits in decades and it has used up all its physical power. So going into three, he will have to reopen the economy and have to get along with big tech because otherwise that means that the China will have to raise his best feeling.

And who is going to buy Chinese government bout or like you know, investment grade popery board because a lot of the issuers are government affiliates Bloomberg Opinions Shu Ran that doesn't for this week's Bloomberg Opinion. Do get in touch with us that we love to hear yoursels in opinions. I'm at Vequinn at Bloomberg dot Net. Don't forget. We're also available as a podcast on Apple, Spotify or your favorite podcast platform. We're produced by Eric mollow Till next time on Knoberg Opinion