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What We Can Learn From The Richest Man In Asia
Submitted by Simon Black via Sovereign Man blog,
It was nine months ago when we reported that Li Ka-shing, the richest man in Asia, had sold all of his major assets in China.
In 2013 when he started dumping his Chinese property holdings he was being ridiculed and criticized. Everyone was bullish on China’s real estate market.
It turns out you don’t want to bet against a man with a track record like Li’s.
Li Ka-shing’s grasp for major trends is unmatched. And he demonstrated his shrewdness and insight yet again when China’s real estate market went into correction mode last year.
He got out right at the peak of the market.
He recognized that China’s major credit bubble isn’t sustainable. Behind closed doors, the bosses in Beijing know it too.
A recent report by the chief economist at the Bank of Singapore reveals that the Chinese leadership is desperately trying to conceal the effects of excessive credit and engineer a ‘soft landing’.
And yet Chinese credit expansion continues.
Data from the Bank of International Settlements shows that in 2014 credit expansion’s share of GDP growth soared by 14%.
Since the end of 2008, credit expansion has accounted for 79% of China’s GDP growth.
Historical data and analysis shows that such levels of credit expansion inevitably lead to a lot of bad debts that can’t be repaid.
We’ve already seen first ever Chinese corporate defaults as a result of these policies, and we can expect more.
The long-term trend for China is of course, positive, but this doesn’t mean it’s going to be a smooth ride along the way. Nothing goes up or down in a straight line.
Right now, renminbi assets are falling and renminbi is weakening. Capital is fleeing China in fear of a major credit crunch.
Li was one of the first to spot this trend, and he got out.
Moreover, he’s hedging his bets across the board.
His most recent move is to restructure his investment companies and move them to the Cayman Islands.
Li is being very prudent– moving his money and his assets far away to safe, stable locations so that no single government has control over him.
Until now he was very much dependent on a single jurisdiction. He resides in Hong Kong and has Hong Kong SAR citizenship. His business interests were centered in Hong Kong and China as well.
Now, Hong Kong is an incredible place. The banks are well-capitalized, the government is solvent, and there’s a lot of economic opportunity.
But no matter how safe you think your home country might be, it NEVER makes sense to be completely dependent on one place.
Li understands that. Hedging your bets is crucial.
He has already acquired a second passport (Canada), and now he’s moving certain business interests and cash assets abroad.
In doing so, Li is also making sure that the wealth he worked to build over his entire life will be properly safeguarded for his family.
It’s hard to imagine he’ll be worse off for doing any of this. And if the worst happens, Li will be much better off for following his instincts.
This is good advice for anyone.
Remember: rational, successful people have a Plan B.
Rational, successful people take steps to minimize their downside risk.
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Simon's right. I'm going to start restructuring my 3 muti-billion dollar investment companies starting Monday.
I corrrectly guessed it was a simon black and stopped before reading the first sentence. I think I'll diversify into authors that make sense.
"Remember: rational, successful people have a Plan B."
I am already at Plan D.
You can't take it with you.
Li Ka-Shing?
Sounds like a made-up name. Like Neal Kash-Karry or whatever.
HE didn't do shit. He is wealthy enough that he pays SMART people to do these things for him.
This is equivalent to complementing the Queen for how tidy Buckingham Palace is.
For 90% of those HERE, and 99% on earth, there isn't enough time to even learn 1/10th of what is needed to be able to do this and not end up being Panama'd.
You know what we can really learn from the richest man in Asia?
That being rich is better than being poor.
Just like the schmucks who talk to a 16 year old girl online and agree to meet them. They go in the slammer, genpop, for a long time.
What about the billionaire who has a harem that half the free world fucks?
pods
Uh, please... the richest man in Asia?!
I think by now we all know that the Rothschilds/Sassoons and their well-networked incestuous cliques are by far the "richest". They just like to hide behind their veils as hidden usury interest reapers and not outwardly flaunt their ill-gotten graft. It's much easier to wield global power that way from under the rocks.
There may be more veils than seen:
Sir Ka-Shing (little publisized) is a KBE and had avoided the turmoil of CCP take over of China ---"swam to freedom" (as it was called in those days) in Hong Kong. Biography.
I doubt it he would let anyone to control his enterprises.
Only one plan here: Get shit. Use shit. Try not to die.
There is no Plan B.
But, we all know what you have to do when things become serious.
Let me guess, you're American, right?
Simon Black is a commentator who is a blithering idiot. Li converted his property holdings to convertible assets because he is old and he realizes that his heirs would be easy picking for any wolves from Wall Street or elsewhere. I stopped watching NBC Nightly News because I got sick and tired of the constant "Making A Difference" happy talk canned stories, worthless propaganda. Brian Williams is no Walter Cronkite or even Tom Brokaw, the NBC news coverage only looked adequate in comparison to Diane Sawyer and Wolf Blitzer. Self censoring idiots who belonged on radio. Just like Brian Williams.
Moving your "assets" around the planet is like changing cabins on the Titanic
Large Everest Capital hedge fund closing after Swiss franc losses: Bloomberg
http://news.yahoo.com/large-everest-capital-hedge-fund-closing-swiss-fra...
WASHINGTON (Reuters) - Hedge fund manager Marko Dimitrijevic is closing his largest hedge fund, Everest Capital's Global Fund, having lost almost all its money after the Swiss National Bank (SNB) scrapped its three-year-old cap on the franc against the euro, Bloomberg news reported on Saturday.
Citing a person familiar with the firm, Bloomberg said the fund had been betting that the Swiss franc would decline. The fund had about $830 million in assets at the end of 2014, according to a client report cited by Bloomberg.
Li is an uneducated man who dropped out of high school to work as a waiter in a teahouse to support his mom and siblings when his dad dropped dead suddenly.
Uneducated men have no blinding orthodoxy and normally have Street Smart that comes with first hand experience in trenches. His personal philosophy is "Know When To Stop" and whenever he stops from doing a particular business is normally the top of that particular business.
"Cabbage."
That's what cash is.
"The Cabbage."
Talk to a trucker sometime.
Or a logger or a roofer.
"Its all about the cabbage.". The job gets done from 6:00 AM to 11:00AM. After that its all bonus money.
He once said the best childhood for a boy is the one in poverty because he believes poverty is the best education for a little boy.
He happens to own many great big ports around the world and also the Panama Canal. he piled in his money into biggie ports in mid 90s when most Americans started to pile into so-called "New Econony".
Conventional education is now a net negative for most people if doing a simple cost / benefit analysis
As it has always been for maverick geniuses
A safe place like Canada huh? I live in Canada, it's panic time here right now.
Chinese know how to embezzle, but they sure as hell don't know what's going oni on in the world. If he has real estate here,he'll watch it drop by 40% over the next year or so. Nice call Li.
"I live in Canada, it's panic time here right now."
What do you mean? More panic than usual?
Hongcouver and Cowgary might drop 30% max. That kills flippers but people with revenue will ride it out IMO.
copy
I agree. Although Primesinister Harper has been printing $Cn at a crazy pace to try and keep parity. We'll do much better if we can ditch him.
primesinister
that's good
We are printting to keep it below parity (thanks to old yeller).........won't need to print so much now with the commodities getting crushed though.
160% debt to income for the av. household in Canadia. I'm not bloody surprised.
Wot housing bubl?
Husky Energy (HSE) based in Canada is owned by Li Family + CKH Holdings. I would think they have an idea of Canada.
It IS somewhat of a curiousity how distinct HSE's place is in the new org chart.
I'm not panicked at all in Canada. carpenter must drink msm kool-aid.
Husky has done me well over the last fifteen years.
Yield 4.5%
I completely agree Carpenter1, the Chinese (and Russian) government screwdness is widely overrated. Some überwealthy robber barons know how to manipulate and bribe the system and make a huge fortune, but other than that the Chinese and Russian governments are colossal bureaucratic central planning institutions who couldn't organize a binge-drinking party in a brewery.
This Li guy isnt so smart he gets out at the peak of a market, he gets inside knowledge beore the shhep...Its a big club and we aint in it. Fuck em all. At the end of the day all the money in the world cant conceal your a doucebag.
So what, that just means if you watch what he does and not what he says you will likely benefit as well.
Uncle Warren, Soros et al are the exact same deal......watch the body movement, don't fall for the head fakes.
Ole Li ain't that smart or he would have said 'Ka Ching because he had bought Swiss assets 3 weeks ago.
Too many ignorant Merkans posting on this thread... What, is it haltime in the big football game?
>> Too many ignorant Merkans posting
I'm still waiting for you to post something intelligent. What country do you represent (poorly)?
Li Ka-Ching !
Li Ka-Shing was a smart man. Well thought out move in 2014.
when you bet on the wrong gang (Bo Xi Lai/Zheng) and lose, you re-arrange your chips. The rest of this piece is what ZH has been saying for months.
move on
In doing so, Li is also making sure that the wealth he worked to build over his entire life will be properly safeguarded for his family."
Worked hard?
Doing what?
It sounds like his country could really use his efforts to build real wealth, if that's what he knows how to do.
Instead, he flees.
These are not people to follow. They are without honor.
m
Sounds like he is into some crooked stuff and is fleeing the corruption crackdown.
Decesions decesion, where to allocate my 500 bucks in savings and 150 in checking.
I would venture a dictionary might be a wise investment
Sorry, you handed it over to me on a silver platter, couldn't resist
Well I'm slowly building up on my investments in canned goods and extra med's that I need. Next month I'm getting some rye whiskey and more cheap red wine from Sam's. I'd also suggest some extra KY jelly because it looks like we are going to get boned this year.
Arrest him. Dude's a financial pervert.
Translation: "He makes a lot more money than I do."
US Banks dumped their shares of Chinese banks over the last couple years. Now, we're seeing pieces of things unfold.
Li ka pussy is just way smarter!
Having taken the mickey out of preppers earlier, one of the predictions here by Gail Tverberg means they may be right.
(A couple of articles up or own)
Li needs to become a survivalist prepper nothing else will save him.
Financial instability and the new bail ins will pretty much wipe everything out in interconnected global financial markets as they desperately try and pay out on huge derivative trades.
Everything .... companies, trade, everything, even a pile of gold doesn't work, no where to trade it and you can't eat it.
Even the super-rich are not isolated.
Hold on , gloater. I don't know how you got here but this is the Howdy Doody Show, and i'm pretty sure Howdy Doody is a puppet.
So where are the usual "China is so smart" fanboys? Li obviously knows more than the average Joe-Sixpack reader of ZH..
I've told you guys here a million times, the Chinese couldn't organize a piss-up in a brewery. Sure, some Chinese got very rich, but it's not a testament of the Chinese government's central planning capabilities and foresights.
Anyone want to bet on the SNB change being deliberately set up Gravy for TPTB (Li Kashing ... really?) and the flip being the signal for "the end"?
Instant 20% if you were on the correct side of it. Much more if you leveraged.
The face of world Oligarchy.
This is why the GWB/Clinton combine will go down in history as the new Polo brothers.
Then as today, Venice's Oligarchs wanted China's oligarchs to trade more along the old silk road!
'My successes the world knows about, the failures I keep to myself''.
'I am getting rich,, very slowly'
Well, he's connected so he knows ahead of time...
Too bad most Americanos don't think like Li. They are too busy imagining that USA is "No1" and that no place on earth is better. Stupid people. They will be left holding the bag when the crash does come.