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