Propped-up? –linked to WSJ blogs, Pictures of the Day…
Alibaba, it is written, will raise 15 billion on the NYSE in its IPO. However, contrary to some apologists’ portrayals, Alibaba is subject to the power of the Politburo of Beijing. Alibaba, being so huge, could potentially be a market de-stabilizer under the right (or wrong) circumstances.
There is no getting around it, not every state-linked company is the same. A company linked to a republican democracy with a long track-record of righting its own wrongs (the US) is different from one linked to a politburo-run Communist nation state (China) that is well-known for reinforcing its past wrongs.
Why not hold-off until the right political reforms are established in China? A company rooted in such a system adopts the same lack of accountability its governing power insists on keeping. It is at high risk of being covertly propped-up in bad times, and therefore is a high tectonic risk in an already topsy-turvy free world stock market.
Politically Well 