Jack Ma committed a mistake - He began acting like a US Billionaire or an Indian Billionaire or a UK Billionaire.
His IPO was demolished because Bankers who are valued heavily in China - simply felt his valuation was inflated and believed that for such numbers as he showed - he had to plan on being a monopoly in various businesses.
In China unlike India - the Bankers dont issue Loans but instead have the Billionaire borrow directly from the Public and underwrite the Debt (Meaning debt which has been unsold will be purchased by the Banks). This way - China can seize upto 51% of Mas assets in 10 minutes instead of 10 years after 1000 Court cases. ‘
Ma was literally given a highly conservative valuation for his IPO and was given terms and conditions he did not like. The Bankers said “You want your Valuation to be adhered to. Fine. Put up Collateral for the same”. Its unusual in most countries for New IPOs to put up Collateral but in China this is the law.
Jack Ma did not like this.
So he began his criticism of Chinas Banking Regulations. He called them Pawnbrokers rather than bankers for their demand of collateral or for their conservatism and for their aversion to loans the way the Capitalists did.
Had it been Hu Jiantao- he would have ignored Ma. They had a strong strong system so Mas ranting would not help in any way. China did not have a Republic TV or Arnab Goswami to raise the tempers. However Xi Jingping was a different leader and felt the affront personally.
So he ordered to Look into Jack Ma
Suddenly you had a thousand requests for various routine things for MAs companies. Revaluing things. Examining Currency related things. Even deciding to introduce a Shenzi law to acquire 51% of non compliant chinese entities (Basically drafted and created just for Ma).
Now upto this point is actual fact. Information for this comes from the Asian Wall Street Journal and the Economist and a variety of Reputable non Globaltimes articles.
However beyond this is Speculation and Theory
My personal Belief - is that Jack Ma got rattled. He did not expect such a backlash. Somehow Ma had started to believe he was living in New York and not Shanghai. Suddenly when so much scrutiny was being done, Ma knew he could lose his company (Every single Company has regulatory issues. This is taken for granted)
So he must have appealed to the Bosses and they must have told him Lie Low and shut the hell up.
His Disappearance and his Sombre reappearance to talk to Teachers indicates that he has been broken. The rest of the Billionaires will see what happened to MA and will understand that the System will remain in force and cannot be criticized with.
The message is - Nobody is above the System (Except Xi Jingping maybe). Even Billionaires must follow the System and prosper within it.
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