If it is, yes, you should go out more often. =)
But yeah, the point of this is that there were quite a number of bashers talking about Alibaba's VIE political risks imposed on Yahoo in the YHOO board, which is completely irrelevant. Yahoo owns ordinary shares, and are not (nearly as) vulnerable to the VIE political risk than the shares of BABA traded on the NYSE.
I took it as, YHOO shares went through a few changes:
1) All shares went from preferred to ordinary (maybe? I don't know what exact type of shares Yahoo held prior to IPO, but they're definitely ordinary now)
2a) The portion sold to the IPO went to the Cayman holding company, which in turn issued ADS (or ADR, whatever) shares that were sold on the market last Friday.
2b) The remaining shares Yahoo held onto through Yahoo HK are all ordinary shares (equivalent to the ones Ma et al. have), not the ADR/ADS we have. This portion is the vast majority of Yahoo's holdings.
2c) The shares that Yahoo not-HK is holding onto are perhaps ADS/ADR shares?
The question still remains: how is the Cayman holding company holding onto the ordinary shares? Last I remember, Cayman Islands isn't a part of China. :P
According to the CNBC article on Yahoo's own summary page, my theory that Yahoo's remaining Alibaba shares are ordinary shares, and not ADS, is correct.
Sorry, I didn't see you at the party -- were you late or something? This was known since the last earnings call which happened two months ago.
I think people need to stop worrying about the VIE structure for Yahoo and Softbank:
Let me ask: what are the "shares" held by Yahoo before the IPO? Were they common shares? AFAIK, the VIE/ADS weren't created until the IPO through the Cayman Islands corp, which means the shares held by Yahoo prior to the IPO are not the same shares that's being traded under BABA now.
In other words, if Yahoo's HK subsidiary still hold the same kind of shares prior to the IPO, that means Yahoo HK's shares are fundamentally different than those traded on the NYSE (I heard they were preferred shares?). Which means if Yahoo was to get bought out and the share ownership structure remains the same (i.e. new Yahoo subsidiary owns the sub-subsidiary Yahoo HK), then that means there is very little risk with regard to the Chinese gov't revoking the VIE structure (which many, many other US-listed Chinese companies depend on, so I doubt this will happen suddenly).
Similarly, I believe Softbank holds ownership of Alibaba shares also through some Chinese subsidiary, which will result in the same share ownership as Yahoo HK. In this scenario, that means if Son buys out Yahoo, he has actual ownership of Alibaba, not the VIE/ADS structure we're playing with.
Then by your logic, stocks will never go up because the big boys will close it out every week.
Because they can't afford BABA. Including the hedge funds and arbitragers. So they sell YHOO and put in orders for BABA.
Then people should just buy more. I suspect a lot of money getting drained out of YHOO, because they need funds to buy BABA. After all, one can buy BABA directly now. This imbalance should be short term...but not sure how long "short" means.