American Consequences - January 2021

SPECIAL REPORT

attention on the need to speed up and streamline the approvals process and brought new investors to this capital-intensive industry. But to be fair, this may not be a prediction for 2021... more like 2021 through 2030. With the markets in a euphoric frenzy over risk assets, nothing is cheap, including biotechnology stocks. That makes the investment implications of this trend more difficult to parse. You’ve got to tread carefully. But it this way... much like you choose where to allocate capital, we need to choose where we allocate our research time, and we’re investing a big slug into biotech.

President Donald Trump spent his last few months in office depriving many listed Chinese companies of access to the U.S. stock market and, by virtue, American capital. These include the delisting of China’s three largest telecom stocks, including China Mobile. He’s also included Xiaomi and CNOOC in the investment blacklist. All totaled, these companies remove $344 billion in market capitalization from U.S. exchanges, not including 30 other mainland China-listed firms. While it appears that no other Chinese companies will be added to the blacklist until President-elect Joe Biden takes office, it’s unlikely that any of these delisted stocks will return to Wall Street anytime soon. That leaves a gaping hole in the investment portfolios of funds and retail investors looking to keep or increase their exposure to China. As the world’s only growing major economy in 2020, and the only major economy to grow by 8% to 9% this year, the latter is more likely to happen. Yes, U.S. investors who were kicked out of these abovementioned Chinese stocks will want to gain more exposure to the world’s fastest-growing economy. By knocking out half a dozen of the largest companies that The wheels of a biotechnolo- gy revolution have begun to turn, and they’ve been accel- erated by the pandemic.

BRIAN TYCANGCO TRUE WEALTH OPPORTUNITIES: CHINA

This isn’t just a year when China fully recovers from the COVID-19 pandemic. It’s also the year its stock market reaches a milestone first achieved by Wall Street in 2018. Yes, the actions by the White House, the Department of Defense, and the State Department are going to create the first trillion-dollar market cap companies in China. That’s going to happen in the next 12 months, and here’s why...

American Consequences

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