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C&R Loads Up Alibaba Stock & Then Baba Visits Detroit!

C&R is putting our money where are mouth is… we’re talking Alibaba.

We are building a low six figure stock position in this business trade-bridge that’s accelerating global trade. It will likely be good for Michigan and US compaines.

In recent years we bought Alibaba stock for this reason:

  • Because more Michigan and US companies have increased their profit margins by having access to “legitimate” low cost Chinese suppliers. China is in a wild west phase of capitalism. Alibaba is acting as a scout, deal broker and as a sheriff for US companies.

In recent months we bought Alibaba stock for this reason:

  • Alibaba has made strides to not only be a door into purchasing from China, but more importantly their door is starting to swing the other way allowing US goods-suppliers to sell to Chinese companies.

C&R does not offer stock advice. We only trade our own cash. We are talking about this to share our excitement about a company that is likely creating a level playing field for global trade.  (stock ticker: baba)

Crain’s Business Detroit: April 25, 2017

China’s largest e-commerce company, Alibaba Group Holdings Ltd., has released details on a conference in Detroit aimed at helping U.S. business to boost exports to China.

The Gateway ’17 event, to be held at Cobo Center on June 20-21 and previously reported by Crain’s, is expected to attract more than 1,000 U.S. businesses, the company said in a news release.

Jack Ma, founder and chairman of Alibaba, will keynote the Detroit procurement events.

Jack Ma, Alibaba’s founder and one of China’s wealthiest people, is scheduled to deliver a keynote at his company’s export event in Detroit this summer.

“Hosting the event in Detroit – in America’s heartland – will further our goal to educate U.S. small businesses, farmers and entrepreneurs about the opportunities the Chinese market has to offer,” Brion Tingler, Alibaba Group head of external affairs, said in a statement. “It’s also in a convenient location with transport and hospitality infrastructure that will enable small businesses and farmers to participate with ease.”

“China is an important and viable market for a wide range of products and services. This event will open doors for Michigan businesses, farmers and entrepreneurs by helping them identify and enter into new relationships there,” Gov. Rick Snyder said in a news release. “By participating in Gateway ’17, Michigan businesses will have a unique opportunity to reach new customers in the fastest-growing economy in the world, and we encourage all companies looking to expand into exporting to attend this event.”

Ma, in a statement, said the event will help open China’s growing consumer market to U.S. companies and boost profits.

“The Chinese market presents tremendous opportunities for U.S. small businesses and farmers to grow their businesses, and in turn, create more U.S. jobs,” Ma said in a statement. “China’s middle-class population is projected to exceed 600 million by 2022, or nearly twice the size of the entire U.S. population. Last year, China surpassed the U.S. as the world’s largest retail market, with spending topping U.S. $4.84 trillion. By next year, China’s online spending will be greater than the rest of the world combined.”

Michigan exported $3.2 billion in products to China in 2016, making it the state’s third-largest export partner behind only Mexico and Canada. Automotive parts leads the list of exports to China, followed by agricultural products including soybeans, feed grain, dairy and vegetables.

Founded in Hangzhou, China, in 1999, Alibaba has grown into one of China’s largest companies, with a market capitalization of nearly $284 billion — more than Wal-Mart Stores Inc. at $227 billion, but less than competitor Amazon Inc. at $433 billion.

Alibaba’s 2014 initial public offering raised $25 billion on the New York Stock Exchange and introduced Alibaba to western investors, though the company remains mostly unknown to U.S. shoppers despite its more than 450 million customers in more than 200 countries.

Yet U.S. tech companies are aware of Alibaba’s presence. Jerry Wang, a co-founder of Yahoo Inc., serves on Alibaba’s board and Yahoo has a $40 billion stake in the company, Fortune reported in March.

Earlier this year, Ma wrote in a Wall Street Journal op-ed that Alibaba would enroll 1 million U.S. small businesses to its various e-commerce platforms, primarily on its Taobao and Tmall websites. The company claims it hosts 10 million merchants in China that employ 30 million people.

In January, Ant Financial Services Group, the payment affiliate of Alibaba, announced it would buy Dallas-based money-transfer company MoneyGram International Inc. for about $880 million.

China and Michigan have had a lucrative business connection for decades. Major Michigan companies already operate in China, such as Ford Motor Co., General Motors Co., Dow Chemical Co., Whirlpool Corp., BorgWarner Inc., Key Safety Systems Inc., among others. China’s Shanghai Automotive Industry Corp., Aviation Industry Corp. of China, Fuyao Auto Glass, Wanxiang Group and others own several Michigan auto companies.