Professor Mary Pieterse-Bloem on investing in China and some recent developments in the United States

Chinese Economy

The Professor observes that the Chinese economy is slowing. The question then arises whether the Chinese government does enough to stimulate consumer demand. According to Pieterse-Bloem, the Chinese authorities are not willing to further support Chinese banks and the real estate sector due to the large debts these actors have. Alternatively, the Chinese authorities decided to change the short-term mortgage interest to stimulate consumer demand. Furthermore, Pieterse-Bloem notes that the geopolitical situation complicates the Chinese economy. The Biden administration has chosen a path of economic decoupling from China and is trying to put India in a more prominent position.

Philips

Philips settled with American consumers who suffered economic impact of the CPAP sleep apnea machines. The Professor explains that this compensation was relatively easy because the economic impact of the faulty machines was easy to calculate. The financial impact for Philips in the coming cases will be difficult to predict. These cases will be centered around the psychological and medical impact of the faulty sleep apnea machines on consumers, which is difficult to put a number on. Analysts therefore vary widely on the financial impact of these cases.

Google

In a few months, a court case will be held in the United States in which the answer will be questioned whether Google may retain its dominant position with its search engine. Google has such a dominant position that it can contractually bind other (tech-)companies to set Google’s search engine as the primary search engine on their devices. Investors are watching the ruling with suspicion, as it could have a big impact for other companies as well.