# Alibaba IPO...Chinese beating the Americans at their own game?



## carverman (Nov 8, 2010)

This past week there was a lot of media hype about Alibaba and the $219 BILLION (Plus) US market cap..however, even though the company has offices in China.. why did it choose for it's financial holdings to be located somewhere else? ..like the Cayman Islands..long known as a tax haven. 

extract from an article in Forbes:


> Over six months ago I wrote that the contemplated Alibaba IPO would be a huge success, not because it’s a great deal for investors, but because Wall Street desperately needed it. The fees for Wall Street firms will be more than $300 million.
> 
> The celebration was fantastic. I felt like the only sober person at a wild party. No one seriously questioned the problems of governance, structure, etc. although some pro-forma statements were made, apparently as a defense in future law suits when investors will claim, “I didn’t know I was just buying a Cayman Island firm.” Unfortunately, on national television only the opinions of those beholden to Wall Street were featured.





> What Are Investors Buying Into?
> People think they are buying shares in Alibaba China. But actually, while Jack Ma and partners are p*utting $20 billion into their pockets today from the IPO, the investors are actually getting pieces of paper in Alibaba Holdings Cayman Islands*, a so-called VIE (variable interest entity).
> 
> *This does not give investors any share in the Alibaba assets, nor shareholder rights, only a share in the profits. And who determines those: Jack Ma and his board. It’s like an “I.O.U part of the profits if I decide there are any.*”





> A Hypothetical
> What would investors say if Jeff Bezos of "Amazon.com" AMZN would try to raise $20 billion in a new Cayman Islands firm that only gives the investors a share of the profits in Amazon? The laughter would be heard around the world. But Amazon is a U.S. company, subject to U.S. accounting rules and “rule of law.” Alibaba China has none of that protection. China is not necessarily famous for proper accounting.
> 
> *An Illegal Structure?*
> *The Chinese government forbids foreigners from investing directly in Internet services in China but they can invest in the security being offered in the IPO*.


http://www.forbes.com/sites/investor/2014/09/19/alibaba-ipo-day-recap-run-jack-run/


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## Beaver101 (Nov 14, 2011)

^ Answer: could be. Question: why isn't the SEC stopping these kinds of IPOs? Or are their hands really tied or does Wall Street rules instead? 

If investors/traders don't buy into the hype, then Alibaba can go Alios-bye-bye, no?


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## carverman (Nov 8, 2010)

Beaver101 said:


> ^ Answer: could be. Question: why isn't the SEC stopping these kinds of IPOs? Or are their hands really tied or does Wall Street rules instead?
> 
> If investors/traders don't buy into the hype, then Alibaba can go Alios-bye-bye, no?


Time will tell if this Chinese online enterprise is a long term like Amazon or Ebay, or just some "spit in the wind", where investors flock to buy....a chance at untold profits, and not real shares. With 20 billion from this IPO, what is to stop them from doing "splits-ville" and disappearing into thin air?

If all the investors are doing is buying some paper that entitles them to profits, is it any different than lets say Nortel shares (something I am very familiar with), and that company's fortunes taking a turn for the worst
and investors left holding empty bags. For a while Nortel was the highest trading stock on the TSE and
the darling of high tech...because everyone thought the same way..established for many years and 
too big to fail.....

In Nortel's heydays, investors were "millionares on paper"..and some actually made a lot of money from the dividends and
profits selling shares as they kept going up and up. But eventually, their shares became nearly worthless as panic selling
in the last days from 2003? to 2008 drove the stock down to penny stock.

Just wondering what the reason for the IPO? If they were doing so well, why do they need to sell " not real shares"?...but for their money. the investors may get a chance to share profits.
Provided of course, Jack Ma actually declares profits that are worth the IPO. 

Big gamble here, since if they decide to call it quits and dissolve to form some other entity,
the investors can't go after them in the US Courts...I think as being located in the Cayman islands, they
may be immune from prosecution if it turns out to be another investment swindle..and we know
from history about Madoff, but at least the SEC went after him. Investigators have determined others 
were involved in the scheme.


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## sags (May 15, 2010)

A "bait and switch" fraud of biblical proportions is what it would be...........if the information is true.


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## Rusty O'Toole (Feb 1, 2012)

The kind of deal that always marks the top of the market. Alibaba is going to zero, but no one knows when. Will it be another Pets.com or will they spin it out as long as Enron?


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## carverman (Nov 8, 2010)

sags said:


> A "bait and switch" fraud of biblical proportions is what it would be...........if the information is true.


So far, I'm not aware of any huge fraud involving the Chinese capitalists. However, it is strange that this online e-commerce enterprise did not list on the Hongkong exchange due to restrictions from the Chinese communist gov't, which can quickly rein him in depending on what is happening on internet transactions,
that they could see as a threat to their way of doing business with the west. 



> Alibaba is also ultimately at the mercy of the Chinese government. One of its top risk factors is how the rules governing the marketplace in China could change.





> One example: Alipay was suddenly spun off in 2011 into the hands of Ma after *China's central bank issued regulations* requiring non-bank payment companies to obtain a certain operating license. A*libaba is incorporated in the Cayman Islands and all companies without this license had to halt business by September 2011.* There’s no word on when that will change. Meanwhile, Alipay is growing fast and handling payments for Alibaba as a third party.


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## My Own Advisor (Sep 24, 2012)

Anyone thinking of buying Alibaba?


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## carverman (Nov 8, 2010)

Apparently you cannot buy actual shares (the Chinese venture capitalists own all the shares) but you can buy a
chance at the profits made by this global e-commerce conglomerate of several Chinese companies including
one that is similar to Paypal. 

excerpt from Forbes:


> *What Are Investors Buying Into?*
> People think they are buying shares in Alibaba China. But actually, while Jack Ma and partners are putting $20 billion into their pockets today from the IPO, the i*nvestors are actually getting pieces of paper in Alibaba Holdings Cayman Islands, a so-called VIE (variable interest entity).*





> A VIE is an entity meeting one of the following three criteria as elaborated in FASB ASC 810-10 [formerly FIN 46 (Revised)]:
> 
> The equity-at-risk is not sufficient to support the entity's activities (e.g.: t*he entity is thinly capitalized, the group of equity holders possess no substantive voting rights, etc.)*
> 
> ...





> This does not give investors any share in the Alibaba assets, nor shareholder rights, only a share in the profits. And who determines those: Jack Ma and his board. It’s like an “I.O.U part of the profits if I decide there are any.”


They are either very clever or..very crafty, finding unique ways loopholes within the Chinese regulations allowing them to operate in other countries. Here is what investopedia is saying about them.

http://www.investopedia.com/articles/investing/081214/5-things-know-about-alibaba-ipo.asp


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## Beaver101 (Nov 14, 2011)

My Own Advisor said:


> Anyone thinking of buying Alibaba?


 ... my own advisor tells me your question is a joke,right? :biggrin:

If you're serious with the question, check out the original poster (Lena100?) in the Stocks section. Hypee ...


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## carverman (Nov 8, 2010)

Beaver101 said:


> ... my own advisor tells me your question is a joke,right? :biggrin:
> 
> If you're serious with the question, check out the original poster (Lena100?) in the Stocks section. Hypee ...


it's a crap shoot as far as investments because you have absolutely no control over its direction or business. These VIEs are just a "promissory note" that if you invest in Alibaba, you are entitled to the profits it makes..only. Now right now it's the best thing since sliced bread in China as they have seen tremendous growth in the last..3 years as the Chinese are catching on to the internet buying craze, and we in NA can order from Alibaba as well. 

Their "paypal" scheme allows you to buy "confidently" form the various Chinese vendors on this e-commerce
success..the question is?..if they are very successful making billions..why do they need foreign investors?


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## My Own Advisor (Sep 24, 2012)

Well, somewhat serious Beaver101.... 

I will be very interested to see how Alibaba market share plays out.


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## carverman (Nov 8, 2010)

My Own Advisor said:


> Well, somewhat serious Beaver101....
> 
> I will be very interested to see how Alibaba market share plays out.


Well here are my concerns.
1) You are buying VIE (variable investment entity)..which sounds like another name for Virtual Investment Scheme with
your purchase. This is some kind of paper that entitles you to a share of the profits based on how much you invest.
if you invest a $1000, you may not get that much in profits, invest a million or more and that should make you a bit richer
IF they are making a profit and from the hype they seem to be doing very well, but this is all secret stuff..no stock guidance
like you would have with NA companies in the form of a prospectus.

2. You will never own real stock in this company so you won't be able to submit your input as a shareholder at a shareholders
meeting..you can only rely on what the Alibaba holdings company give you and they are headquartered in the Cayman Islands,
which is a tax haven and arms length from any Canadian or American gov't agencies like the SEC. 

3.


> Tax haven Cayman does not tax offshore companies on income earned outside of the territory making it fit into the category of tax havens, since, a tax haven is a country or jurisdiction which has low tax or no taxes at all in place for corporations and other entities. *The Tax haven of Cayman Islands has no taxation system in place for Cayman International business companies.
> *
> Offshore corporations incorporated in the Cayman Islands will pay no income tax or corporate taxes on capital gained abroad. Capital includes interests, profits and dividends. Cayman Islands trust and offshore business entities are exempted from paying Stamp Duty for transaction done on behalf of the two. There is no capital gains tax, income tax, corporate tax, estate tax, gift tax, withholding tax and inheritance tax applied in the offshore tax haven of the Cayman Islands.





> Making its home in the Cayman Islands affords Alibaba an unprecedented amount of freedom and privacy, some of which it will have to give up in the IPO, and some of which will make it less transparent than U.S. regulators and investors are comfortable with.
> 
> But there's one big problem that comes along with being a Cayman Islands entity.





> Alibaba has a massive problem with counterfeit products, which could deter Americans from using the website. Others have pointed out that Chinese companies have underperformed in the US market. Ma also has a very tight grip on the company, and doesn't want to let go of that.


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## sags (May 15, 2010)

What happens if Alibaba sells some of their companies ? Would that be included as a "profit" ?

What happens if Alibaba spends it's profits buying other companies ? The investors get less ?

What happens if Alibaba declares bankruptcy or is taken over by another company ?

It sounds like this structure is another creation of Wall Street bankers to enable IPO fees to come flowing in.

I am not sure it is a good deal for investors or not.


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## My Own Advisor (Sep 24, 2012)

I don't have any interest myself, but I am curious how investors will run with this one...seems like a bunch of risk...


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## carverman (Nov 8, 2010)

sags said:


> It sounds like this structure is another creation of Wall Street bankers to enable IPO fees to come flowing in.


I think you hit the nail on the head, Sags. Wall Street is desperate for some cash and these fees will be significant for them. 
Wall Street brokers don't give a hoot on how this will play out for the actual investors that buy shares into the profits only, that is up to the SEC and they probably don't have much clout over anything that happens in the Cayaman Islands. 

There are a few unanswered questions on this one, that there are 18 owners of this online enterprise with a
collection of side dot com services. Maybe their goal is to eventually squeeze out Ebay, Amazon,and perhaps Paypal?

Certainly from the media hype on their IPO, they (Jack Ma and 18 other Chinese investors) have managed (rumoured) to pocket 20 Billion US from the IPO, and Wall Street, over 300 million in fees. 

here is their SEC prospectus summary:

http://www.alibabagroup.com/en/ir/secfilings


> Our Business
> We are the largest online and mobile commerce company in the world in terms of gross merchandise volume in 2013, according to the IDC GMV Report. We operate our ecosystem as a platform for third parties, and we do not engage in direct sales, compete with our merchants or hold inventory.





> We have made significant investments in proprietary technologies and infrastructure in order to support our growing ecosystem. Our technology and infrastructure allow us to harness the substantial volume of data generated from our marketplaces and to further develop and optimize the products and services offered on our platform.


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## sags (May 15, 2010)

They sell a lot of interesting stuff on that website.........and a lot of it is in bulk orders.

Used scooters..........minimum order of 100 for example.

It would be tough to gather up 100 used scooters for sale in all of Ontario.

I suppose they probably earn hefty commissions on their bulk sales.

But the issue for investors is if they will get their full share of the profits.........and forever is a long time.


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## Beaver101 (Nov 14, 2011)

carverman said:


> I think you hit the nail on the head, Sags. Wall Street is desperate for some cash and these fees will be significant for them.
> Wall Street brokers don't give a hoot on how this will play out for the actual investors that buy shares into the profits only, *that is up to the SEC and they probably don't have much clout over anything that happens in the Cayaman Islands*.
> 
> There are a few unanswered questions on this one, that there are 18 owners of this online enterprise with a
> ...


 .. so what's the exact role or purpose of SEC? To protect Wall St. or investors?


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## Jagt Mirage (Sep 29, 2014)

Ultimately investors put money into stocks either because they're looking for dividend income or because they believe the company is going to grow and so will their stocks so they can reap capital gain. Since this isn't a dividend stock it's purely the latter. In terms of growth prospects, it's difficult not to be bullish on BABA. It's got a stranglehold on the largest e-commerce market in the world, a market which has got nowhere to go but up with over 1/2 a billion people still not on the internet, greater than the entire population of US and Canada combined. Compare that to AMZN/FB/EBAY who are all in mature markets with limited upside. 

In terms of stability BABA is not like a startup. It's been in business for over a decade with a unique e-commerce model which has proven dominant. It's fundamentals are stronger than any of the Western players except GOOGL and maybe MSFT. The Chinese triangle of internet dominance is now established in BIDU, BABA, and Tencent. It would be very difficult for another upstart to unstage any of them at this stage just like GOOGL, AMZN, EBAY, FB.

People should also keep in mind. IPOs like BABA isn't unprecedented. BIDU is also a VIE I believe on NYSE and it's been there for many years. Both BIDU and Tencent are up more than 10X since their IPO price, making alot of investors alot of money.

As for governance, I believe that's a red-herring. How much influence do you think you have buying FB? what chance do you have to unseat MZ? answer: zero, zilch. That stuff is way down the line of factors of buying a stock. Ultimately for investors it's about capital gain.


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## lonewolf (Jun 12, 2012)

Rusty O'Toole said:


> The kind of deal that always marks the top of the market. Alibaba is going to zero, but no one knows when. Will it be another Pets.com or will they spin it out as long as Enron?


 Rusty spot on that is why I like reading your posts @ the top of "The South Sea Bubble" a marvelous stock came to market that no one seamed to know what the stock was about yet the masses back then wanted to own it. Alibaba nailed the top of this bubble just like the marvelous stock nailed the top of the south sea bubble.


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## carverman (Nov 8, 2010)

Beaver101 said:


> .. so what's the exact role or purpose of SEC? To protect Wall St. or investors?


It's (SEC) supposed to act on behalf of both, if there is suspicion that some kind of fraud is committed in selling of securities or investments. This came as a result of the big crash of '29. They have a lot of muscle when it comes to prosecuting any Americans that have been found to have committed fraud (pyramid schemes etc)...but the question here is...

other than issuing a stop trading order on Wall street, what other enforcement can the SEC issue against a foreign nationalist that is not a US citizen or subject to any US penalties? 

Even if there was some "incident/situation" in the future, where investors were screaming that they have been cheated, what is the SEC going to do ...other than remove that "stock" which is really a chance at a "profit
option" from being traded on Wall street?
The original Chinese investors can profit from the trading windfall and continue trading everywhere else.

Being HQ in the Cayman Islands, it would be an assumption here, that it is highly unlikely there would be much effort to go after them there , unless of course a blatant fraud has been detected, and that would have to be done with diplomatic means, since the SEC can't go after them there..or seize any assets in China. Only the Chinese gov't can really go after them. 



> SEC has a three-part mission: protect investors; maintain fair, orderly, and efficient markets; facilitate capital formation.
> The enforcement authority given by Congress allows the SEC to bring civil enforcement actions against individuals or companies alleged to have committed accounting fraud, provided false information, or engaged in insider trading or other violations of the securities law. The SEC also works with criminal law enforcement agencies to prosecute individuals and companies alike for offenses which include a criminal violation.
> 
> To achieve its mandate, the SEC enforces the statutory requirement that public companies submit quarterly and annual reports,


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## carverman (Nov 8, 2010)

and so it begins..at least what the media hype leads us to believe.
http://www.bloomberg.com/news/2014-...-can-reap-11-billion-in-breakup-real-m-a.html



> Activist fund Starboard Value LP stepped up pressure on *Yahoo last week to break itself up,* a move analysts say could amount to an *$11 billion market value gain.* *Starboard’s proposals include Yahoo selling its valuable stakes in Alibaba Group Holding Ltd. (BABA) *and Yahoo Japan Corp. and merging with advertising rival AOL Inc. (AOL) The ideas lay out a plan for *rewarding investors who are losing confidence in Chief Executive Officer Marissa Mayer’s ability to create value with the acquisitions she’s been making.*


*




Alternatively, Yahoo may be a good acquisition for Alibaba or SoftBank Corp., Harriss said. A deal would enable Alibaba to buy back its shares from Yahoo without a large tax leak. As SoftBank searches for targets, buying Yahoo would increase its stakes in Yahoo Japan (4689) and Alibaba.

Click to expand...

*


> Yahoo, now worth less than those Asian stakes, has put $1.3 billion toward takeovers since 2012, around the same time Mayer took the helm, according to Starboard. During that period, earnings before interest, taxes, depreciation and amortization dropped by almost half as revenue also slid. *Investors are now left holding a $40.52 stock that could be valued at more than $50 in a breakup* -- $51 if you ask Gabelli & Co. and up to $57 by Albert Fried & Co.’s estimates.


Hmmm? Do I see a media market frenzy beginning where shares are manipulated by marketing experts to maximize profits for themselves, regardless of actual worth of the "dot com" entity? It boggles the mind to think of what is
going to happen next.


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## kcowan (Jul 1, 2010)

Remember the fight over Sino-Forest where the Chinese company claimed forest holdings that were fraudulent.
Sino-Forest Investors fight over scraps in fraudulent company
Investors lost billions...


> “What you are left with is about a penny on every dollar that every investor lost. So, yes, on one hand, it sounds like a huge amount of money, but on the other hand, it is a pittance.”


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## carverman (Nov 8, 2010)

kcowan said:


> Remember the fight over Sino-Forest where the Chinese company claimed forest holdings that were fraudulent.


It seems then, when it comes to investing in Chinese owned entities, there is some risk involved as they seem to play a different game in NA.



> Ebay; Home Depot; Mattel;
> Some suffered from a lack of flexibility, or a failure to localize. Others fell because of bad timing, or a superior local competitor. While the causes are as varied as the industries themselves, a pattern can be discerned among the biggest failures in China: *an inability to grasp just how different — and cutthroat — the Chinese market can be. *
> 
> “It’s a lack of understanding of the legal and cultural environment that leads to most failures,”
> ...


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## Beaver101 (Nov 14, 2011)

carverman said:


> It's (SEC) supposed to act on behalf of both, if there is suspicion that some kind of fraud is committed in selling of securities or investments. This came as a result of the big crash of '29. They have a lot of muscle when it comes to prosecuting any Americans that have been found to have committed fraud (pyramid schemes etc)...but the question here is...
> 
> *other than issuing a stop trading order on Wall street, what other enforcement can the SEC issue against a foreign nationalist that is not a US citizen or subject to any US penalties*? ....


 ... perhaps they should look at their own rules prior to allowing a blow-up/melt-down of an epic proportion. 




> SEC has a three-part mission: protect investors; maintain fair, orderly, and efficient markets; facilitate capital formation.
> The enforcement authority given by Congress allows the SEC to bring civil enforcement actions against individuals or companies alleged to have committed accounting fraud, provided false information, or engaged in insider trading or other violations of the securities law. The SEC also works with criminal law enforcement agencies to prosecute individuals and companies alike for offenses which include a criminal violation.
> 
> To achieve its mandate, the *SEC enforces the statutory requirement that public companies submit quarterly and annual reports, *


 ... so does it mean the IPO filings were all kosher with the SEC? Do they care after the $300M+ initiation fee has been collected by Wall St.?


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## sags (May 15, 2010)

Beaver101 said:


> ... perhaps they should look at their own rules prior to allowing a blow-up/melt-down of an epic proportion.
> 
> 
> ... so does it mean the IPO filings were all kosher with the SEC? Do they care after the $300M+ initiation fee has been collected by Wall St.?


Alibaba is a conglomerate of assorted companies and it would be impossible for the SEC to audit their filings.

They would have to travel to China and audit each company from top to bottom,......which even if China would allow the intrusion (which they wouldn't because Chinese companies aren't officially able to have foreign investors), would require the entire staff of the SEC working for years on a simple filing.

Alibaba's profits are whatever Jack Ma says they are.............more or less.


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## Beaver101 (Nov 14, 2011)

sags said:


> Alibaba is a conglomerate of assorted companies and *it would be impossible for the SEC to audit their filings*.
> 
> They would have to travel to China and audit each company from top to bottom,......which even if China would allow the intrusion (which they wouldn't because Chinese companies aren't officially able to have foreign investors), would require the entire staff of the SEC working for years on a simple filing.
> 
> *Alibaba's profits are whatever Jack Ma says they are.............*more or less.


 ... so the SEC doesn't realize they have a gigantic loophole there? after what happened to their neighbour on Sino-Forest ? 

Wow, then Jack Ma can be richer than Mark Zuckerberg.


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## sags (May 15, 2010)

Alibaba is also a large part of many Chinese communist leaders personal family trusts and fortunes. 

Those leaders have a self interest and dictatorial power over what Alibaba does or reports as profits.

They could choose to share the wealth fairly and freely with everyone.........but it might be a leap in faith to believe they would.

They don't currently share much with the Chinese people,....... from their personal fortunes.


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## Beaver101 (Nov 14, 2011)

sags said:


> *Alibaba is also a large part of many Chinese communist leaders personal family trusts and fortunes*.
> 
> Those leaders have a self interest and dictatorial power over what Alibaba does or reports as profits.
> 
> ...


 ... so American investors are not aware of this and SEC's hands are tied? 

Of course, no communist party in the world, including Russia would share their wealth with their own people.


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## Jagt Mirage (Sep 29, 2014)

well BABA stands at over $106 today. If you had bought at IPO of $68 or even post IPO open of around $92, you would've made a nice chunk of change.


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## carverman (Nov 8, 2010)

sags said:


> Alibaba is also a large part of many Chinese communist leaders personal family trusts and fortunes.
> 
> *Those leaders have a self interest and dictatorial power over what Alibaba does or reports as profits.*
> 
> ...


That ^ and as well, you can get scammed easily, if you don't know what you are doing on this marketing portal
where communication may be difficult..unless you understand Chinese... and it is difficult to get your money back in some cases. Dealing with the Chinese over international disputes for quality of goods or money transactions is very time consuming, and the results can be doubtful in some cases. 

Regardless of the hype of their stock going up, I still say, that only time will tell with this one whether they become an international success story... or disappear into the Chinese woodwork leaving investors holding empty bags.

Buying bona fide Chinese made goods is one thing, but there appears to be just as many scams as "good deals" in Chinese made goods...and fakes as well. What concerns me is that alibaba appears to be a haven for scam artists as well. 

If you receive defective Chinese made goods and the seller has your money, it is a difficult process to get
satisfaction. 
here is some advice from an e-commerce business coach. 
http://andrewminalto.com/alibaba-scam-exposed/




> It seems that a lot of people are being seduced by offers that are clearly bogus or too good to be true and in the excitement of scooping a fantastic deal forget the basics.
> 
> You cannot get non-Chinese branded goods from Alibaba, so if they are offered to you and you accept the transaction, you are engaging with criminals who will be delighted to take your money and send nothing in return. They are equally aware that there is nothing you can do about it.


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## Jagt Mirage (Sep 29, 2014)

carverman said:


> If you receive defective Chinese made goods and the seller has your money, it is a difficult process to get
> satisfaction.
> here is some advice from an e-commerce business coach.
> http://andrewminalto.com/alibaba-scam-exposed/


That's why most everyone who uses Alibaba uses Alipay, so the seller WON'T have your money unless you're absolutely satisfied. If you're not, you can refuse it at the door for any reason and the seller gets nothing. Alibaba is not the wild west of e-commerce. It may be sexy for western media to portray it as that, but it's just not true. Alibaba processed and delivered more online transactions in one day than every US e-commerce site did on Black Friday and Cyber Monday combined. You think there wouldn't be a massive public outcry for lynching Jack Ma if even 1% of those transactions were scams? Every company has it's dirty laundry. You don't think FB or EB has any skeletons in its closets? Let's put things in perspective here.


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## carverman (Nov 8, 2010)

Jagt Mirage said:


> That's why most everyone who uses Alibaba uses Alipay, so the seller WON'T have your money unless you're absolutely satisfied. If you're not, you can refuse it at the door for any reason and the seller gets nothing. Alibaba is not the wild west of e-commerce. It may be sexy for western media to portray it as that, but it's just not true. Alibaba processed and delivered more online transactions in one day than every US e-commerce site did on Black Friday and Cyber Monday combined. You think there wouldn't be a massive public outcry for lynching Jack Ma if even 1% of those transactions were scams? Every company has it's dirty laundry. You don't think FB or EB has any skeletons in its closets? Let's put things in perspective here.


I would think that Jack Ma and his Chinese investors are far removed from the normal day to day trading activities, and any problems with transactions would be between the seller and buyer, even if it was a scam. 
Good to know that they have AliPay, which is their form of Paypal.


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## Jagt Mirage (Sep 29, 2014)

carverman said:


> I would think that Jack Ma and his Chinese investors are far removed from the normal day to day trading activities, and any problems with transactions would be between the seller and buyer, even if it was a scam.
> Good to know that they have AliPay, which is their form of Paypal.


Ma Yun (Jack) is a household name in China, like Bill Gates or Steve Jobs is here. If a lot of ppl got burned by scams on Alibaba, you can bet he will be absolutely crucified. Unlike what many people thinks, social media in China is extremely sophisticated and users are not shy to completely slag companies and individuals. They're absolutely vicious.

Paypal may be first, but Alipay is by far the biggest internet payment service right now with over $150 billion in transactions last year, more than triple that of Paypal. It's functionality is actually quite sophisticated, definitely not a Paypal lite.


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## Jagt Mirage (Sep 29, 2014)

Seems quite a few analysts thinks BABA is going to go after Ebay once it split off Paypal next year. With the market cap it has right now (it gained another 2.6% today to over $108 now) BABA can very easily buy Ebay. I shudder to think of the Behemoth that would create.


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## Jagt Mirage (Sep 29, 2014)

Now at almost $115! I'm seriously regretting not getting in a couple of weeks ago when it was still in the 80s. Would've made a nice chunk of change.


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## brandon1f (Nov 13, 2014)

*Nice article here on BABA*

http://www.thefinancialbulls.com/#!...Now/c95u/8996C961-06C6-49FC-BBDF-83BC55092204


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