Last night, many readers were shocked as to why a company with fewer than 200 employees could earn 45% of Tencent's profits. Let me explain briefly.
Tether (not the Tianjin-based TEDA) primarily issues USDT, the world's largest stablecoin. USDT is pegged 1:1 to the US dollar. To obtain 1 million USDT, you need to deposit 1 million US dollars with Tether. Of course, if you decide to stop investing, you can redeem your USDT for US dollars.
USDT is essentially the US dollar on the blockchain; you use it to buy and sell assets and transfer money to others. Currently, its issuance size is around $160 billion, which means that $160 billion is sitting in Tether for free. They use this $160 billion to buy US Treasury bonds, which yielded interest rates of over 5% a few years ago and are still around 3.5-4% now, earning them $6-8 billion annually without lifting a finger.
This company has an incredibly sharp eye; they used their easy-earning US dollars to buy Bitcoin and gold at low prices, doubling and multiplying their profits again and again.
This amazing company hasn't raised much capital yet. It mainly has four individual shareholders, with the largest shareholder being an Italian who holds over 40% of the shares. He's not particularly interested in institutional money or going public.
Today, A-shares witnessed a dramatic style reversal, with the liquor sector leading the charge and the CSI Liquor Index surging 9.79%. The entire sector, except for Kweichow Moutai, hit its daily limit.
Actually, there's not much positive news for the liquor sector. If we had to pinpoint a target, it would be the recent rebound in the wholesale price of Moutai, from 1500 to over 1600. Today, taking advantage of the good market conditions, some are touting a rise to over 1700. This isn't particularly unusual, as the Spring Festival is traditionally a peak season for liquor consumption, and price recovery is normal. This little bit of news alone isn't enough to trigger a general surge in the liquor sector.
So why is that? I think there are four possibilities, listed in descending order of probability in my mind.
1. This is unrelated to news; it's simply a rebound from oversold conditions that have been pent up for a long time during the bear market. The CSI Liquor Index has fallen for five consecutive years, significantly underperforming the broader market. With shares oversold to a certain extent, it finally triggered a surge in market sentiment. The saying "bear markets often see long bullish candles" applies here. However, these rebounds usually only last 5-7% within a day; I've never seen an entire sector hit its daily limit up before. (50% probability)
2. Linked to the real estate sector, industry sources indicate that many real estate companies are no longer required by regulators to report the "three red lines" indicators monthly. This signals a loosening of financial restrictions. Today, the CSI Real Estate Index rose 3.6%, and upstream and downstream building materials and furniture stocks also rose. Historically, the liquor industry has been highly correlated with the real estate sector. However, real estate stocks only rose by less than 4%, making it difficult to explain the significant rise in liquor stocks. (30% probability)
3. There may be subsequent policies to stimulate consumption that have been leaked to a limited number of people. (10% probability)
4. The big brother or other super-large institutions bought liquor. (5% probability)
Besides that, there's another 5% that I didn't expect. After the market closed today, someone even said that Moutai invested in SpaceX's Series A funding round; anyone with an IQ above 70 wouldn't believe that.
I previously expressed the view that the recovery of baijiu consumption depends on the bottoming out of the real estate market. Has the real estate market bottomed out? I've been observing various data recently. Overall, the decline has eased somewhat, and the number of listings in first-tier cities has started to decrease. However, there is no data showing that national housing prices began to rebound in January, not even stabilizing. Under such circumstances, betting on a reversal in baijiu is risky, even though the sector rose 10% today.
Tomorrow, liquor stocks will definitely open significantly higher. Let's see if they close with a negative or positive candlestick before drawing any conclusions.
Today's A-share trading volume reached 3.23 trillion yuan, a significant increase, which is likely related to the intense style shift within the market. Old Deng's assets rebounded across the board, with funds siphoning funds away from Little Deng's sector, leaving all indices except the two leading ones in the red, and the market median also falling by 0.92%.
It's difficult for A-shares to experience a balanced rise where everyone prospers. The seesaw can only lift one side at a time. As long as ETFs continue to rebound, sectors below the 'neck' (referring to specific sectors) will suffer. Therefore, the best way to cool down the hype surrounding concept stocks isn't to sell off ETFs, but to boost real estate and liquor stocks. A decisive enough push will send those speculative stocks scrambling for cover. 
Today, three sectors surprisingly saw gains exceeding 8%. Besides liquor, another was precious metals, up 8.04%. You all know what's going on here: gold's latest price is $5518, and silver's is $119āit's gone completely crazy. The third was oil and gas exploration, up 8.14%, due to various signs indicating that the US will soon launch a strike against Iran.
The United States recently issued an ultimatum to Iran, demanding that it agree to four conditions: a permanent halt to uranium enrichment, the export of all enriched uranium, limitations on the range of its ballistic missiles, and a cessation of support for proxy forces in the region. If Iran does not express a willingness to negotiate and compromise this week, the US military may intervene at any time.
The US military deployment is now complete, and the USS Abraham Lincoln carrier strike group has silently entered its designated area with all signals turned off. Trump can strike at any time if he wants. Currently, it's Israel that's less inclined to attack, because the conflict last June depleted Israel's interceptor missiles. Iran, unable to defeat the US military, would simply dump all its missiles into Israel's inventory, and Netanyahu is unwilling to bear such a heavy loss.
Furthermore, if war breaks out, Iran is likely to block the Strait of Hormuz, at which point oil prices will certainly soar, and funds both domestically and internationally are betting on this in advance.
The latest odds for on-chain casinos: 10% before the end of January, 49% before the end of February, 60% before the end of March, and 66% before the end of June.
1. The US dollar did not cut interest rates last night, remaining in the 3.5-3.75% range. This was in line with market expectations, so there was little fluctuation in the capital markets. However, Powell has angered Trump because of the slow pace of rate cuts, and he has repeatedly said he will deal with him later.
2. The China Aerospace Science and Technology Corporation (CASC) announced today that during the 15th Five-Year Plan period, it will promote new fields such as space tourism, space digital infrastructure construction, space resource development, and space traffic management. Many media reports have used simple and sensational headlines, claiming that China is also going to "mine for minerals in space." If we exclude Musk, the spacefaring capabilities of China and Russia are only slightly behind the United States, but the current problem is that they are far behind Musk. The biggest expectation for the commercial space sector in 2026 is whether Chinese companies can achieve their first successful rocket recovery.
That's about it for tonight. Speaking of which, I just remembered something and checked the securities sector. It surged 1.28% today! Haha, it's not included in either the small-cap or the big-cap rallies. During the bear market, it was at 850 points; now, even with six times the trading volume, it's still at 850 points. A complete clown! š¤£
Original Article: View Chinese Version
