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the Biden Administration is proposing new shipping rules targeting uh shien and uh timu and Alibaba long-standing
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trade law allows low value shipments ENT the US without duties and fees have been
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abused by companies the administration says the new rule would prevent uh those exemptions a report from the house
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select committee on the Chinese Communist Party says uh Shen and uh timu are likely responsible for more than 30%
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of all packages within the exemptions according to committee uh a gap paid uh $700 million and import duties in 2022
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well Shen and timu uh paid none I think that's probably needs to be fixed um what do you think about this it does
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make things more expensive for the American Consumer for the average yeah look look uh just disclosure I'm an
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investor in Shen um I think this is I think this is hard to argue for maintaining I I don't I mean two things
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they are they're taking advantage as companies do of a loophole and what I would like to see is these these tax is
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done away for everybody um I'm a I'm I'm totally anti- tariffs anti-taxes unless
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it's used as a strategic weapon if we're Outsourcing pollution or someone or the
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Chinese decide to try and dump steel whatever it is but I'm I'd like to see the taxes I mean Gap in H&M you know say
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they paid 700 and 200 million respectively on this tax because this is a loophole that says if it's less than
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$800 and it's going direct to the household you don't have to pay these I think it's import taxes so I I think
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this is hard to argue that this shouldn't be closed or they should they shouldn't get rid of the the taxes or
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the import duties on the other brands what they don't realize is this is only a small cost or Delta and what gives
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these companies such an incredible advantage and Sheen and the reason I invested in it is that if you look at
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companies over the last 20 years that have added tens of billions of dollars in market
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capitalization they T tend to have one thing in common and that is their asset light and the really amazing the reason
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I invested in Shen and the reason why even with if they have to pay these tariffs they're still going to have an
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unbelievable advantage over these other players and these two companies will be responsible for1 and5 spent over the
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holidays and their advantage is the following it's all software they don't own any assets they don't own a single
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Factory a single truck a single plane a single Warehouse or a single store and what they do is they use AI to examine
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activity on their site and with this machine learning in AI they can go okay we're going to need exactly
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7700 pairs of bellbottom tie-dye jeans and then within a microsc the software goes these are the three best factories
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to produce it and then other pieces of the software start going okay this is the fastest way to get it to the
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consumer and because it goes because of all of this incredible demand estimation
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it's because it's such a low price there are fewer and fewer returns it's more efficient and they're able to charge a
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fraction of the price of Zara I mean it's it it's what Zara did to everybody else these guys are doing to Zara and
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it's all with software there's no assets here so as a as a result Shen is going to be the second largest apparel company
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in the world surpassing Amazon this year and next year they're probably going to
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surpass Walmart with no assets so this will hurt them a little bit I think it's unfair I think they should pay the price
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they should pay the tax but be clear it's not it's barely going to slow their growth that's not the issue here the is
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as these other companies have an outdated business model and Shen has a just a much better business model yeah
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well Walmart was ahead in technologically that's why they did so well technology always matters in these
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cases um but we'll see they they deserve to pay the tax sorry sorry companies you
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have to pay the tax