After the article was published last night, many readers asked a question: How could a professional investor like me also fall for a P2P platform and fail to see that it was a scam?
Indeed, after experiencing the industry collapse and social turmoil in recent years, most ordinary people equate P2P with fraud, but this was not the original intention of the industry’s development. The essence of P2P is the platform-based management of private lending, collecting funds from many individuals and distributing them to many others. This requires calculating the bad debt rate and interest spread, which demands a high level of risk control management. However, as long as the business model is well established, it can be viable; it is not a scam, it is a form of subprime debt in private lending.
Our family started investing in P2P as early as 2012, when there were only three platforms: Renrendai, Paipaidai, and Yixin, offering around 12% annualized returns and operating relatively regularly. This yield was not outrageous in the high-interest environment of that year, as trusts were also generally offering 10-12%.
In the following years, a large amount of capital flooded into the P2P industry due to a regulatory vacuum. Many shell companies put up signs and began operations to attract deposits. From 2015 to 2017, the industry reached its peak, with domestic P2P platforms increasing to over 5,000 and the industry's transaction scale climbing to 3 trillion.
Many of these newly established companies are makeshift operations; they lack the ability to build their own risk control systems. They cannot do P2P; they can only do P2B (lending money to a few large institutions and earning the interest spread) or even more absurd P2Me (taking the money to invest in stocks themselves).
There are also some traditional industry listed companies whose owners feel that business is becoming increasingly difficult and are thinking of entering the P2P industry to make quick money. Zhao Weiping of Panda Financial Holdings is one of them; he has been in the fireworks business for many years and is a billionaire. Objectively speaking, he cannot be considered a fraud; he is just an overly confident traditional businessman.
At that time, Panda had two platforms, Yinhu Network and Panda Financial Holdings, with a total scale of about 5 billion. This money was lent to many enterprises, but when the industry faced a run on funds, it could not be recovered, resulting in a large amount of bad debts and a broken capital chain, which collapsed in an instant. Zhao Weiping, who previously made money from fireworks, simply could not fill such a huge hole, turning from a local tycoon to a universally condemned debtor in a short time.
Panda is not an isolated case; at that time, thousands of platforms across the country were experiencing a run on funds. Initially, it was some poorly managed platforms that exploded and fled. Then the government saw that the situation was uncontrollable and imposed a blanket ban on all P2P platforms. As a result, even those platforms that were operating honestly could not continue. Many borrowers took advantage of the situation and deliberately defaulted because they were sure the police and courts were overwhelmed and could not manage so many issues.
My wife invested in 5 platforms at that time; the other 4 platforms fully returned the principal and interest, but only Panda had to cut losses. After calculating, most of the interest earned over the years has been lost. The money I gave her was from our family's medium-risk (annualized 10-15%) position, and this result is acceptable.
So I was clear about the nature of P2P investment from the very beginning and knew what kind of risks corresponded to my returns. The only thing I didn't anticipate was that the industry would ultimately collapse at an unimaginable speed under regulatory pressure, leading to a chaotic exit situation. In the absence of rules, many people were unethically profiting, and vulnerable investors became the biggest victims.
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1. American congressmen also passed the "Big and Beautiful" bill, mainly aimed at increasing spending and reducing taxes, benefiting some wealthy individuals, but it will increase America's debt. Musk immediately announced the establishment of the "American Party" and claimed he would participate in next year's elections, aiming to concentrate resources to compete for 2-3 Senate seats and 8-10 House districts, becoming the third force in American politics, which can play a key role when the Democrats and Republicans are evenly matched.
Will he succeed? It's hard to say. There have been wealthy individuals or political stars in American history who attempted to establish a third political party, but they all failed. However, none of those who failed were as wealthy as Musk or had as many fans; in fact, none of them combined had the influence of Musk, so it’s worth trying to find out.
Musk's actions will provoke further retaliation from Trump, which poses a significant risk to Tesla's stock price.
2. China is conducting an anti-dumping investigation on European brandy, imposing a tax of 27-35%, unless these companies agree not to export to China below a certain price. This is clearly a retaliation against electric vehicles, as Europe believes that Chinese electric vehicles are being dumped in Europe, with a tax standard of around 35% and a requirement that China's export price cannot fall below a certain level.
Currently, the divergence in negotiations is about what a specific price level is. Europe demands 35,000-40,000 euros, and if this figure is confirmed, many low-priced cars from China will not be able to be sold. China hopes to negotiate down to 30,000 euros to sell more, creating a divergence of 5,000-10,000 euros. Bringing brandy into the discussion is intended to pressure Europe into making concessions.
3. The deadline for Trump's 90-day tariff negotiation extension is approaching; July 9 is the deadline. Currently, only China, Vietnam, the UK, and Cambodia have reached agreements, and Europe has a framework to avoid a complete breakdown in negotiations, but most other countries do not have any expectation of reaching an agreement. Trump may erupt again and give the world another shock; this is the biggest uncertainty factor in the capital market next week, and we need to pay attention to updates on the process.
4. The delivery subsidy war between Meituan, Ele.me, and JD continues to escalate, with all three continuing to invest. This competition will have a negative impact on the performance of the listed companies in the short term, as they are essentially competing for dominance in the instant retail market. Meituan's stock price has performed poorly in the past six months because it has passively faced challenges from Douyin, Alibaba, and JD, leading some to believe it appears to be the weakest among the giants, making it a target for competitors.
5. China Shipbuilding has absorbed and merged with China Shipbuilding Industry Corporation and obtained approval from the Shanghai Stock Exchange.
6. A major event also occurred recently in the Bitcoin community, where a certain giant moved 8 ancient accounts, each with 10,000 Bitcoins, to a new wallet address. These are referred to as ancient accounts because these 80,000 Bitcoins have had no operations since 2011, when the cost of Bitcoin was about 1 dollar each. Now it has risen 110,000 times, making 80,000 worth 8.8 billion dollars.
Currently, there are no signs of selling from these addresses, but it's hard to say what will happen next. There is much speculation online about the holders of these 80,000 Bitcoins, but they lack evidence or rationale. Honestly, I'm quite curious about what kind of person can hold onto something that cost 1 dollar and is now worth 110,000 dollars, resisting the urge to sell in between; this is akin to a legendary "diamond hand".
Good night, Uncle Jiang.