Xi Jinping unironically promised to remove “all kinds of obstacles” to private enterprises during his much-ballyhooed “symposium” with Chinese tech moguls on Monday.

Someone should’ve quipped: “Oh, you’re stepping down?”

Actually no, someone shouldn’t, and surely didn’t, say anything of the sort, because derision isn’t something the emperor takes lightly. Indeed, the most compelling takeaway from Xi’s chat with Chinese business leaders was the apparent rapprochement with Jack Ma, whose sharp-tongued critique of Beijing in October of 2020 nearly cost him everything, and set in motion the yearslong crackdown Xi implicitly pledged to lift on Monday.

Ma and Xi shook hands at the event. That might sound innocuous to the casual observer, but it was actually a watershed moment. There was a time, in late 2020, when Ma was feared dead, or at least kidnapped, following Xi’s abrupt cancellation of Ant Group’s planned IPO, a Shanghai-Hong Kong dual listing that would’ve counted as the largest public offering in history.

Consider the following. On October 20, 2020, Ma was worth $61 billion on paper (that was still a lot of money back then). Two months later, he was worth $49 billion. Two years later, $29 billion.

As discussed here late last week in “The Dawn Of A New Chinese Tech Bull?“, big-cap China tech shares were already on a roll before word of Xi’s symposium leaked out. Monday looked like a “sell the news” trade, but Tencent extended a furious rally to close at its best levels in years.

As the figure shows, the shares rose above their local highs hit in October, when stimulus promises out of Beijing lifted local equities and lured a tsunami of hot money. The catalyst for Tencent Monday was a press release announcing the integration of DeepSeek into WeChat search.

As a quick aside, recall that Tencent was targeted by Chinese authorities in 2023 during Beijing’s efforts to curb what Xi deemed (correctly, I gotta admit) a socially deleterious gaming addiction. At one point, a shock overnight announcement of new rules limiting in-game spending and prohibiting incentives designed to facilitate engagement, sent the shares plunging more than 15% in a single day. That’s a friendly reminder: Xi’s not a reliable friend.

In the simplest possible terms, Xi’s just using China’s private tech firms to facilitate the state’s AI ambitions. Any and all advancements belong to the state, not to shareholders. You don’t have any claim on the assets of those companies, you just think you do. There’s no rule of law on the Mainland, and the situation’s not much better (if it’s any better at all) in Hong Kong post-2022.

It’s not a coincidence that Xi decided to convene a meeting with Chinese tech moguls just weeks after the DeepSeek news. A Chinese AI company figured something out. The West doesn’t quite know what that something is, or was, yet. Maybe Liang Wenfeng’s “innovation” was just that he figured out how to evade export restrictions. But whatever the case, if DeepSeek’s a turning point in the AI race, Xi wants to be sure everyone remembers that their first and last allegiance is to the state.

Don’t kid yourself. That was the point of Monday’s “symposium.” Xi wanted to get everybody who’s anybody, and everybody who might be anybody, in China’s AI ecosystem into a room, and look them straight in the face with those dead eyes of his. In mafia parlance, they got sent for. They made it out alive, but the message was clear enough I can assure you. (“Thanks for coming. Don’t look at your goddamn shoes. Look up at me. Look. At. Me.”)

The irony, then, of Xi’s ostensible overture to private tech companies is that in fact, this meeting was a tacit reminder that any AI advancements are the de facto property of the state, and to the extent the private sector’s allowed to monetize them, it’s a privilege, not a right. Because there are no rights in Xi’s China.

As ever, that doesn’t mean you can’t make money betting on Chinese tech. But it’s important that foreign investors don’t delude themselves. Xi’s going to leverage any and all AI advancements to enhance the Party’s policing and military capabilities. If you invest in those companies, you’re investing in China’s security state and the PLA.

As hard as this is for Westerners to come to terms with, Xi simply doesn’t believe that capitalism’s the way to go. Straight up. He never bought it, and he never will.

This is perhaps the world’s worst example of the “fool me once, fool me twice” adage. How many times are we going to declare Xi newly open to the notion that affording the private sector free rein is the surest way to prosperity? How many times? He’s just using the private sector. He’s exploiting it.

Never forget: In Xi, we have a man who believes (fervently) that the best historical role model for children is Mao Zedong.

Now by all means, go hand this man your money.