28 December 2021: What's my take of China's financial stability report

My Youtube channel:

Do support and subscribe to my youtube channel if you like my analysis. THANKS!!!

I have extracted the above from China's financial stability report, which is prepared by Mr Sun Tian Qi, the PBOC's financial stability director who mentioned that financial licenses have borders. Pursuant to his comments in November 2021, Tiger Brokers and Futu fell badly pursuant to the news...

But as I read the financial stability report, which was issued in September 2021, I have a different thought on what Mr Sun Tian Qi actually meant. He coauthored this report and mentioned about having framework and processes to regulate the inflow and outflow of capital in China. This thought process also mirrors that of the suggestions of International Monetary Fund. So ultimately, there is a need on clarity on how residents and non-residents capital fund flow in and out of China being a critical point raised by him in this report.

Nevertheless, if you read the part carefully on what I have reproduced above, you would have noted that capital flows are good for investment and retirement as this serves as a "lubricant" and allows people to diversify their investment and portfolio risks in the face of global capital resources.

So all in all, the thought is that there will be regulations rather than a complete ban of overseas investment. The question is whether Tiger Brokers and Futu can stand to benefit from "to be introduced" regulations.

As always, this should not be construed as any investment or trading advice.