A Chinese man named “Ma” was detained. News wipes $26 billion off Alibaba stock

Chinese e-commerce giant Ma co-founded Alibaba saw its Hong Kong-listed shares fall as much as 9.4% on Tuesday after Chinese state media reported that a man named “Ma” in the city of Hangzhou — where Alibaba is located — was nationally He was taken into custody on security grounds.

According to China’s state broadcaster CCTV, the suspect was placed under “compulsory measures” on April 25 on suspicion of “collusion with foreign anti-China hostile forces” for “inciting secession” and “inciting subversion of state power”. Was.

The one-sentence report, which was swiftly picked up by other state media outlets and alerted on Chinese news platforms, triggered panic selling in Hong Kong, wiping an estimated $26 billion from Alibaba’s market value in minutes. gave.

Amid the frenzy, Hu Zijin, the former editor-in-chief of the state-owned nationalist tabloid Global Times, clarified on China’s Twitter-like Weibo that the report was misleading because the suspect’s name consists of three characters. Jack Ma’s Chinese name Ma Yun has only two syllables. (CCTV later quietly updated its original report to match Hu’s assessment).

To address further concerns, the Global Times reported that the accused person was born in Wenzhou in 1985 (while Jack Ma was born in Hangzhou in 1964) and served as the director of hardware research and development in an IT company. had worked in

The clarification led to a rebound, with Alibaba recovering most of its losses by the end of the day.

The market’s roller coaster reaction is the latest sign of how investors are turning over China’s embattled tech sector, which has been the target of heavy-handed regulatory action from the Chinese government since late 2020.

Despite recent signs from the Chinese government it is preparing to back the campaign due to the economic impact, as first reported by the Wall Street Journal, market frenzy on Tuesday indicates investor confidence is faltering. .

“I thought it was a strange episode,” said Victor Shih, a professor of political science at the University of California San Diego. “Was that a warning of sorts to the technology sector as a whole, or perhaps Jack Ma individually. Who knows? But it certainly demonstrates that the government has to wield tens of billions of dollars to a senior technology executive. Don’t get arrested. The company’s market valuation. It just needs to release some sort of information,” Shih said.

“It’s quite powerful. And of course what happened yesterday was a clear example of that power, whether it was distributed or not.”

But the fact that investors were so quick to believe that Jack Ma, once China’s most high-profile billionaire, would fall from state security officials, suggests something of the political reality that many Chinese tycoons now live in. Huh.

A popular comment on Weibo said, “It doesn’t matter if it really is him. The important thing is that many people think it is him, many people expect it to be him, Now that’s interesting.” Received 57,000 likes.

The shift in public sentiment against Ma is almost as spectacular as his Rag to Rich story. Until about three years ago, the English teacher-turned-billionaire was widely worshiped for his charisma, outspokenness and self-made success. (He was also nicknamed “Daddy Ma” by some fans).

But as tech companies like Alibaba expand their business empires, they have become the target of growing frustration and resentment among young Chinese workers, fed up with grueling long working hours, high pressure and stagnant wages. (Jack Ma’s endorsement of China’s so-called “996” work culture, which means working six days a week from 9 a.m. to 9 p.m., drew sharp criticism in 2019.)

As the tech giant fell under the crosshairs of the Chinese government, “rogue capitalists” have increasingly been blamed for a variety of social ills, from relentless competition, to skyrocketing property prices to a lack of social mobility.

Jiang Dongliang, a blogger on WeChat, wrote, “Within a few years, ‘Daddy Ma’ has been labeled a ‘rotten capitalist’ in public opinion, and many are waiting for Ma to fall. “

“But the question is, will bringing down the capitalists and driving out (so-called) foreign forces really make everyone’s life better?”

Jack Ma has mostly disappeared from public life and kept a low profile since the Ant Group IPO in the US in late 2020 was halted by regulators. Once one of the most outspoken figures in China, he has not posted anything on Weibo, where he has almost 25 million followers since October 2020.

His last Weibo post about a meeting with nearly 100 school principals to discuss the future of China’s education was flooded with critical comments.

The top comment said, “I wouldn’t be surprised if the old mother is thrown in jail one day.” “You’re just a bourgeoisie! Don’t pretend to be a good person!” Another comment screamed.

Jack Ma remained silent throughout Tuesday, as rumors against him circulated on the Chinese Internet. The hashtags about the custody of the suspect surnamed Ma were among the top trending topics on Weibo, garnering millions of views.

“They only have silence, which is ‘a special way of existing’,” a columnist Zhang Feng wrote in a widely shared WeChat article after the incident.

“Such silence has a profound significance. For a public figure, his speech is the ‘extension’ of his being. When a person does not speak, though he is still alive, still doing things, less At least part of it has ‘disappeared’.”

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