Trick or treat in the Shein IPO amid a sterling crisis!
Cable has breached 1.23 and it is a heart-attack-Jack moment in Threadneedle Street, White House and 10 Downing Street as the toff hearts miss a beat as the Pet Shop Boys put it.
Destiny must have a sense of irony, though in the Gulf we prefer our housemaids to handle the irony. It is surely ironic that Britain faces a sterling/debt crisis at the same time as Scott Bessent, the mastermind (under Stan D) who helped Soros make a billion dollar killing by forcing sterling's humiliating exit from the ERM on Black Wednesday becomes the most powerful man in global finance as Trump's Treasury Secretary.
All is definitely not hunky-dory in the sceptred isle as hedge funds dump on sterling/gilts with borrowed money in a scary replay of Liz Truss's doom loop in September 2022. Yet I see opportunities galore as I work with a close friend to engineer a 5X trophy asset turnaround deal in London. Cable has breached 1.23 and it is a heart-attack-Jack moment in Threadneedle Street, White House and 10 Downing Street as the toff hearts miss a beat as the Pet Shop Boys put it.
Sterling crises and the Labour Party have a long history. Ramsey MacDonald took the British Empire off the gold standard in 1931. Harold Wilson scuttled the Trucial States (us) in the Crown's imperial East of Suez retreat after he devalued the quid in 1968. Big Jim (Callaghan) was forced to go cap in hand to the IMF in 1976. Tony Blair's Cool Britannia peaked with cable at 2.10 in November 2007 and plunged as low as 1.30 as Jocko Gordo nationalised/bailed out Northern Rock, Lloyds-TSB, RBS and HBOS. Now Elon Musk has Keir Starmer in his crosshairs and the Battle of Britain will be refought on X.
Several close friends phoned me for my take on the Shein IPO. I am not a shill for the Chinese Politburo, especially at a time when the Dragon Empire is exporting deflation and its property meltdown to the world. Shein has had serious sellers in the private market. There was even a distressed seller from Hong Kong in early 2024 who forced down the valuation to $30 billion even though it doubled again to $60 billion now. Shein's ambition for a New York IPO was scuttled by members of Congress asking the SEC to investigate allegations of forced labour in its contracted factories supposedly using Uyghurs from the reeducation camps in Sinkiang.
Shein also faces cutthroat competition from Temu/PDD. H&M also alleges copyright infringement though I cannot imagine the 5000 year old Han Chinese civilization stooping to such uncool, un-Confucion sleaziness as IP theft and industrial espionage from the Gweilo. The PRC's Foreign Ministry was once the Manchu Empire's Office of Barbarian Affairs, a body well known for its solemonic legal judgements in favour of wronged foreigners. Is Shein even a Chinese company any longer, now that it is a software/AI fast fashion ecommerce site based in Singapore? I am sadly a man of faloos (money) and not of falsouf (philosophy).
If heaven hath no fury than a woman scorned, Shein's London IPO could be nixed by the Chinese regulator. Remember Ant IPO and Didi delisting?