Ren Zhengfei of Huawei: The world no longer trusts the US dollar, and there will be a crisis in US debt and US stocks

Foreword: Huawei has a very strict and effective confidentiality system. Uncle Cat’s articles about Huawei come from published news. All Huawei-related digital currency content is based on reasonable speculation based on public information. Nothing comes from Huawei executives, relatives and friends. express, hereby explain.

On September 10, 2019, Ren Zhengfei, the founder of Huawei, gave a speech on the U.S. dollar, U.S. debt and U.S. stocks when he accepted David Rennie, Beijing Branch Director of The Economist and columnist of "Tea House". After review by Huawei's Public and Government Affairs Department Published in Huawei Xinsheng Community, the original text is as follows:

It was originally the world's policeman, maintaining world order. The world's reward is to accept the US dollar as an international circulation and reserve currency. The United States collects seigniorage from the world by issuing US dollars. If the United States continues to assume the responsibility of maintaining the stability of the world order, it will not suffer. But now the United States itself has destroyed this mechanism. People no longer believe that the United States is maintaining world order, nor do they believe that the US dollar is the most reliable reserve currency. When the world's trust in the United States and the dollar shakes, there will be a crisis in U.S. debt and U.S. stocks, which will trigger huge economic and political turmoil within the United States.

The Huawei school recruitment offer that I got 20 years ago is still locked in the cabinet of Uncle Mao’s house. Although I didn’t go there later, as a hardcore “pollen”, my triangular cat kung fu on strategic planning can be regarded as better than Huawei’s work number three A true biography of a big brother with several digits, Mr. Ren's speech, Uncle Cat will take time to study it over and over again.

In my impression, Mr. Ren’s public remarks in the past mainly focused on specific issues such as 5G and Meng Wanzhou. It is rare to see him clearly expressing opinions on major issues such as global politics and finance, the international monetary system, and seigniorage.

As the world's top strategist, it's not surprising that Mr. Ren has this cognition. Basically, this was a high-level consensus ten years ago. It's just that if it's not ready, everyone will save face for the US emperor and let go of internal discussions, but Don't slap your face in public.

How to interpret Mr. Ren's remarks? Why start talking at this time?

His words and deeds will attract intense attention from the global media. If his words reach the ears of President Trump, and that unreliable tweeter vows to defend the hegemony of the US knife again, maybe the dominoes will collapse early. Too beautiful to dare to look at!

Uncle Cat’s understanding is that the collapse of the US dollar hegemony has entered the countdown stage when the wall is overthrown by everyone. Talking about this matter publicly now will no longer trigger a fierce backlash against the leader. .

Moreover, Huawei is ready for the collapse of the US dollar hegemony, the crisis of US debt and US stocks, and the ensuing economic and political turmoil.

Whether it is related to digital currency or not, you can figure it out for yourself. Uncle Mao wants to be quiet, and I don’t want my old colleagues to call me to delete the manuscript.

The following is a list of domestic and foreign official news that has been published recently:

On August 18, 2019, the full text of the "Opinions of the Central Committee of the Communist Party of China and the State Council on Supporting Shenzhen in Building a Pioneering Demonstration Zone of Socialism with Chinese Characteristics" was released. Article 5 "Accelerating the Construction of a Modern Industrial System" clearly stated that it supports the development of digital currency research in Shenzhen Innovative applications such as mobile payment... to promote the internationalization of the RMB first, and explore innovative cross-border financial supervision.

On August 24, 2019, at the Federal Reserve's annual symposium, Bank of England Governor Mark Carney said that the US dollar's status as the global reserve currency must end and that some form of global digital currency -- Something like Facebook's proposed Libra - would be a better option.

On August 29, 2019, according to Shenzhen Special Zone News, Wang Weizhong, secretary of the Shenzhen Municipal Party Committee, met with Yi Gang, governor of the People's Bank of China, and his party. The two parties stated that...in promoting the internationalization of the renminbi and carrying out digital currency research...etc., try first...to fully promote the implementation of major decisions and deployments of the Party Central Committee to be effective.

Then, at the beginning of September 2019, Mu Changchun, director of the Digital Currency Research Institute of the People's Bank of China, gave a lot of dry talk in the open class "Libra and Digital Currency Outlook", among which I copy and paste the original text here.

When I took this course, it was August 2019, and it was not too far away from the launch of our own digital currency by the People's Bank of China. Our digital currency project is called DCEP (Digital Currency Electronic Payment), which is digital currency and electronic payment tool.

……

What does the central bank's digital currency look like?

Its functions and properties are exactly the same as banknotes, except that its form is digital. Our definition of it translates to "digital payment tools with value characteristics".

What does it mean to have "value characteristics"? Simply put, it means "value transfer without an account". You can understand it when you think about paper money. When you pay with banknotes, you don't need an account, and the same is true for DCEP.

You can imagine such a scenario: as long as you and I have DCEP digital wallets on our mobile phones, we don’t even need the Internet. As long as the mobile phone has power, the two mobile phones can touch the digital currency in one’s digital wallet. Transfer to another person.

In other words, when you pay, you don't need to bind any bank account. Unlike we now use WeChat or Alipay, we need to bind a bank card, but DCEP does not need it.

Of course, unless you want to add money to the digital wallet, or you want to withdraw money from the digital wallet for financial management, other than that, mutual transfers between users do not require account binding.

This means that DCEP can circulate like banknotes. This is why, you can simply understand it as a digital alternative to paper money.

I don’t know how the readers feel. Anyway, Uncle Cat was shocked when he saw this paragraph. The central bank friends are too aggressive, and DCEP is too ambitious. This is to use the "world RMB" to kill " U.S. dollar hegemony" is even more aggressive than what Uncle Cat had imagined when he made the report! ! !

Almost two years ago, in the fall of 2017, when Uncle Mao reported to the Shenzhen Municipal Government’s financial affairs supervisor, some of the key contents of the written policy proposals submitted were as follows:

The Belt and Road Initiative and the internationalization of the RMB are my country's long-term strategic goals. Since there is a lot of resistance to dynamic stock, we should find ways to increase it. Commodity transactions such as oil are characterized by large amounts and low frequency, so we will do the opposite, start with small and high-frequency transactions, and refer to the mobile payment system represented by Alipay and WeChat Pay... Compared with the RMB mobile payment system The US dollar mobile payment system is in the lead in all dimensions such as transaction volume, technological leadership, and ecological perfection.

……

The construction work of the "Belt and Road" Mobile Finance International Center includes the "Belt and Road" Mobile Finance International Forum, the "Belt and Road" Mobile Finance International Standardization Organization, the Mobile Finance International Clearing Center, the Mobile Finance International Mass Innovation Base, and the Mobile Finance Industry Guidance Fund ( From angel funds to M&A funds), Shenzhen Stock Exchange's "Belt and Road" board and other six major aspects.

Fans who have been paying attention to Uncle Mao’s column for a long time know that Uncle Mao wrote from the standpoint of an “entrepreneur going abroad” to call for the “National Digital Currency Industry Fund” and the “Shenzhen Stock Exchange Going to the Sea Board”. This is proposed from the source of funds and the exit mechanism. suggestion. Then the government will come forward to convene and participate in the "digital currency" and "RMB internationalization" dialogue research mechanism, so that "entrepreneurs going overseas" can express their demands.

Uncle Mao’s original policy proposals have gradually become a reality. For example, the Shenzhen Financial Technology Research Institute (the Financial Technology Research Institute of the People’s Bank of China), which is located in Shenzhen, is the Digital Currency Research Institute of the People’s Bank of China and Shenzhen Local Financial Supervision Bureau. Co-organized business units. Its responsibilities are: to carry out research in the frontier field of financial technology and related project construction, and promote the development of financial technology. Build a world-class financial technology and digital currency high-end R & D evaluation center and scientific and technological exchange and cooperation center, carry out the construction of national financial technology laboratories, participate in the formulation of financial technology-related standards, conduct domestic and foreign exchanges, cooperation and coordination, and undertake financial technology and digital currency. Relevant certification and testing work, holding financial technology seminars and summits, undertaking financial technology and digital currency related projects of the People's Bank of China and Shenzhen Municipal Government.

There are difficulties within the system. Although the central bank's digital currency partners have started "996" since last year, a "996" is not as good as everyone's "996". So, apart from the central bank, what other positive forces can be mobilized to share? What about building an industrial ecology of "digital currency" and "RMB internationalization"?

The first is the state-owned assets system under the jurisdiction of Shenzhen, then Tencent and Ali, and the financial groups that have grown up in Shenzhen include but are not limited to Ping An and China Merchants.

As well as Shenzhen’s local overseas companies, social capital, etc., such as OPPO, VIVO, and Transsion are mobile phone companies in Shenzhen. ByteDance (Toutiao Douyin)’s Greater Bay Area headquarters has settled in Shenzhen, and Daewoo Infinity (snaptube) started in Guangdong. Street, Dream Chaser Fund, Inno Angel, Innovation Valley, Midu, etc. are all working together.

In fact, the last category (and Huawei ZTE) are the invisible champions who truly have mobile payment resources for overseas mobile phone users. Under the great changes in the internationalization of digital renminbi, these invisible champions each have tens of millions or even hundreds of millions of MAU. How should the business develop next? How should the valuation be calculated?

Uncle Mao is actually not completely clear, so let’s try to benchmark with China Merchants Bank, the leader in domestic retail RMB business. According to the A-share annual report of China Merchants Bank, the total number of savings customers and retail customers reached 100 million and 125 million respectively in 2018. The cumulative number of users of the two major Apps "China Merchants Bank" and "Handheld Life" reached 148 million, of which monthly active users (MAU) exceeded 81 million... The annual operating income was 248.555 billion yuan, and the net profit attributable to shareholders of the Bank was 8.056 billion billion.

Let's do a simple calculation. An APP with 1 billion overseas users has converted 10% of the users into depositors, that is, 100 million depositors, which is about the same as the number of depositors in China Merchants Bank. The operating capacity is worse than that of China Merchants Bank, which is one-fifth of the income of China Merchants Bank. That is 50 billion yuan, but because the cost of Internet companies is much lower than that of traditional banks, the profit of 15 billion should not be too much, right?

In fact, Uncle Mao is very conservative, and only dares to calculate according to the profit margin of the bank. If it is calculated according to the business models of exchanges (such as Binance and Huobi), it will be even more terrifying. Space is limited today, so I will dismantle the secrets of the exchange another day.

There must be some friends who jumped out and said, Uncle Cat, you can’t do this calculation. An APP is an APP, and a bank is a bank. An APP cannot open a bank, and a bank needs a license.

APP can not open a bank? You can ask Mark Zuckerberg, the founder of Facebook. My little brother not only wants to open a bank, but also wants to open the central bank of the world (Libra). The confidence is that their APP has 2.7 billion users worldwide.

The digital currency DCEP of the People's Bank of China wants to compete with Libra overseas to grab the market. If you don't rely on China's overseas APP and mobile phone entrepreneurs to make landing application scenarios, who else can you rely on?

Believe it or not, the central bank and Shenzhen will soon hold a meeting with China’s overseas APP and mobile phone manufacturers. Every user with more than 100 million users will be given a license. Banks and exchanges can do everything, as long as they can get Libra.

In the history of the Age of Discovery, this was called a "Private License" (the license issued by the government led by the United Kingdom to official pirates, allowing robbing ships of other countries, and the proceeds were shared with the government), and the holder of the license was the "Royal Pirate" ". Among them, Francis Drake (Francis Drake) who defeated the Armada is the most famous. He made two voyages around the world in 1577 and 1580, and plundered countless Spanish merchant ships. In April 1581, Queen Elizabeth I personally boarded the ship and awarded Drake the title of Royal Knight. In 1588, Drake became a vice-admiral and helped Britain defeat the Spanish Armada. He was named Lord of England and became a national hero.

The princes and generals are kind to each other.

Shenzhen is a place full of hidden dragons and crouching tigers. Standing on the balcony of Uncle Mao’s house, you can see the old office building where Huawei started from far away. When the big brothers took Uncle Mao to drink at the nearby Hunan restaurant, they once said, “The farmer’s house in the past There is no air-conditioning, we like to lay the floor in the office, the overseas market is not easy to do, and there has been no order, the boss Ren came to pull us into a meeting just to brag and talk about our dreams, and we slept together when we were sleepy. Straight frown, hahahahahahahahahahahahahahaha"

You said, is Huawei considered an "entrepreneur going overseas"? Does Huawei have a layout and preparation for "digital currency"?

Still the same sentence, everything is subject to Huawei's official announcement, and Uncle Mao can't say anything more now.

Those who have read The Three-Body Problem should remember the three core dialogues between Zhang Beihai and his son:

"Think about it."

"After thinking about it?"

"Bei Hai, I can only tell you to think more before that."