A preview of the conversation:

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Jonathan Ramsay and Tassos Stassopolous delve into the current state and future potential of the Chinese economy and its investment opportunities. Despite the prevailing pessimism surrounding China, Tassos highlights the attractive valuations of Chinese companies, trading at significant discounts compared to their historical averages and other emerging markets.

Tassos discusses the importance of separating various risks, such as the use of Baidu's AI by the military, and assessing them objectively. He also notes that while geopolitical risks are mentioned by many, the Chinese population is not yet being prepared for a conflict through propaganda, unlike Russia.

The conversation then shifts to the real estate market in China and its potential impact on consumption. Tassos argues that the wealth effect of the property market slowdown is exaggerated and that the main concern is people's worries about future employment prospects due to the COVID-19 pandemic. He believes that the high savings rate and low consumption levels in China provide a buffer and potential for future growth.

Tassos shares insights from his ethnographic studies in China, highlighting the resilience and adaptability of Chinese consumers. He discusses the growing demand for domestic travel and the shift in consumer values towards experiences and personal growth. The conversation also touches on the innovations in the hotel industry, such as the use of robots for food delivery and the appeal of budget hotels offering high-quality amenities. If you are time pressed perhaps spend just a few minutes watching around the 20-30 minute mark where they discuss Chinese robot hotels, the earning they are generating and how little investors are paying for all of this compared to similar stocks in Western markets. It kind of sums up the video and the contrarian theme that investing in China represents right now.

The discussion then moves to the increasing innovation and competitiveness of Chinese companies, particularly in the electric vehicle and smartphone industries. Tassos argues that foreign brands must adapt to the changing preferences of Chinese consumers or risk being left behind.

Finally, the conversation addresses the potential for investors to benefit from the growth and innovation in China. Tassos emphasises the importance of timing and having a long-term perspective, as well as the need for institutional investors to overcome career risk and align themselves with their clients' best interests.

Watch the full conversation below: