Here’s Another Thought

Two in a week. Settle down.

NASDAQ is (rightfully) suspicious of small-cap companies domiciled in the People’s Republic of China listing their IPOs on NASDAQ’s exchange. The one-day spikes in share prices followed quickly by nearly total collapse of those share prices in so many of the IPOs is what’s drawn attention. For instance:

Shares of more than 20 recently listed companies have risen over 100% on their first day of trading. They include Hong Kong-based fintech company AMTD Digital Inc, which briefly jumped over 320-fold after its July listing, and Chinese garment maker Addentax Group Corp, which rose more than 130-fold on its market debut in August. The two stocks have since lost more than 98% of their value.

As a result, NASDAQ has stopped approving PRC small-caps for listing, for the time being. Which brings me to my thought.

Don’t list any companies domiciled in the PRC on any American exchange, and encourage the other nations in the OECD to do the same. After all, at least since the PRC’s 2017 National Intelligence Law, those PRC companies are too closely tied to the PRC’s intelligence community, and as such, they have no legitimate business raising money through any nation’s stock or bond exchanges other than their own.

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