Is This End of China?
I seeing news stories everywhere on how manufacturing is moving away from China to Vietnam and india, and zero covid policy makes no sense, what are you guys doing? Are you still looking at Chinese stocks?
11 comments
> Are you still looking at Chinese stocks?
Chinese stocks have never been a good idea. China has outright killed industries on a whim[1] and they lack regulations the US have around accounting and reporting. In other words, their exchanges are filled with scams.
[1] https://www.sixthtone.com/news/1010833/china-tried-to-ban-pr....
Chinese stocks have never been a good idea. China has outright killed industries on a whim[1] and they lack regulations the US have around accounting and reporting. In other words, their exchanges are filled with scams.
[1] https://www.sixthtone.com/news/1010833/china-tried-to-ban-pr....
Try reading about China outside of the main US media outlets. You'll gain a different perspective. It'll help balance out your biases.
IE. If you 99.99% of what you read about the US is doom and gloom, you'd think the US is ending too.
In just the last 2 years, US has had mass racial driven protest, people storming a government building looking to murder the vice president, Trump election denial, Trump covid mishandling, highest inflation in 50 years, involved in another war, bungled Afghanistan exit, anti-vax movement, anti-science movement, anti-semitism and neo-nazis, regressive female rights, countless mass gun shootings, highest murder rate amongst developed countries and 12x higher than China, lower expected life span than China.
Which country is more stable again?
IE. If you 99.99% of what you read about the US is doom and gloom, you'd think the US is ending too.
In just the last 2 years, US has had mass racial driven protest, people storming a government building looking to murder the vice president, Trump election denial, Trump covid mishandling, highest inflation in 50 years, involved in another war, bungled Afghanistan exit, anti-vax movement, anti-science movement, anti-semitism and neo-nazis, regressive female rights, countless mass gun shootings, highest murder rate amongst developed countries and 12x higher than China, lower expected life span than China.
Which country is more stable again?
When were the Capitol rioters prosecuted for attempted murder?
I'll take your whataboutism which doesn't even pretend to answer the OP's question and just point out the government isn't harvesting people for their organs, especially from religious dissidents. Last time I checked hasn't killed a bare minimum of 70 million of its own people, although you could fairly adjust that down for populations at the time.
I did answer it. Look at the question in the topic and my answer.
I don't condone killings of any kind. I'm not saying China is the benevolent. I'm simply describing the current state and giving an example of how bias and propaganda can heavily influence a person's views without the person noticing.
I don't condone killings of any kind. I'm not saying China is the benevolent. I'm simply describing the current state and giving an example of how bias and propaganda can heavily influence a person's views without the person noticing.
China's population is mammoth. They can focus on serving their population first and have a huge economy even if all the western economies decided to stop using their services. Also, they have started to focus on serving 3rd world countries that are growing so that's a large market that will use their services.
As far as Covid, they might be making a mistake but its affect will eventually end. After that, they can continue with their economic plan.
It has been slowed, a bit, but not stopped.
As far as Covid, they might be making a mistake but its affect will eventually end. After that, they can continue with their economic plan.
It has been slowed, a bit, but not stopped.
If anything I think China no longer manufacturing cheap foreign goods will strengthen them in the longterm
China's tradjectory if anything should concern South Korea, US, Japan and Taiwan. They are increasingly investing in the ultra-high tech end of the spectrum. Gen 4 nuclear reactors, solar, semi-conductors, batteries, factory automation, agri-tech.
Probably doesn't help the US is playing right into the CCP narrative by employing tech sanctions on China, further feeding nationalistic desire to be self-sufficient. That wouldn't be a huge threat if it wasn't for the huge STEM graduation rate of Chinese students (not just in China, but around the world) and the huge amount of funding put aside for these efforts. Take away ASML EUV machines from the one country most capable of developing their own EUV source and associated optics...? Like how dumb do you have to be to make that mistake.
My guess is this ultimately boils down to the US making the call that they have to stall out Chinese tech/military ambitions by ~10 years to prevent China population peak also coinciding with tech supremacy peak, because if that was to happen in about 2035 then it's very likely China would be much too powerful to prevent them breaking out of the Island Chain containment.
Probably doesn't help the US is playing right into the CCP narrative by employing tech sanctions on China, further feeding nationalistic desire to be self-sufficient. That wouldn't be a huge threat if it wasn't for the huge STEM graduation rate of Chinese students (not just in China, but around the world) and the huge amount of funding put aside for these efforts. Take away ASML EUV machines from the one country most capable of developing their own EUV source and associated optics...? Like how dumb do you have to be to make that mistake.
My guess is this ultimately boils down to the US making the call that they have to stall out Chinese tech/military ambitions by ~10 years to prevent China population peak also coinciding with tech supremacy peak, because if that was to happen in about 2035 then it's very likely China would be much too powerful to prevent them breaking out of the Island Chain containment.
Absent something more serious, it'll take a long while for the PRC to get hurt in the way you outline, there's just too much it and it's large number of people do compared to much smaller Vietnam with I think on average less human capital, and India and its License Raj and other things that make doing business there very high friction. To the point it can't do a lot of things, even run a semiconductor fab line (except maybe in some government labs).
But the PRC and Vietnam are taking hits I interpret due to the world economy slowing down. And Xi's Zero COVID policy is perhaps becoming unsustainable. It's kinda necessary since it's prevented the population from getting natural immunity and their own vaccines aren't good and aren't trusted, and there's a lot of history behind that. If the CCP just let COVID rip, even less nasty Omicron, it would get very ugly for a while.
But it keeps shutting down huge cities and metro areas and has turned the PRC into an unreliable supplier. See the mess Apple is now in, I read something like 6 million and counting fewer iPhone Pros made at that Foxconn plant that's undergoing so much chaos and lost so many of their more experienced workers (or so I assume about the last point).
The US is in a cold war with the PRC, and that's in the process of shutting down its semiconductor industry, or maybe just the most advanced nodes depending on how the new embargo gets administered. But Apple spent quite some time qualifying what's evidently good enough flash from one of their marque companies and that's now dead since it's advanced enough to be targeted.
Overall, this embargo is a moderate sized dagger aimed at "the workshop of the world" so it's going to have effects, especially when the one year delay foreign companies have in getting licenses ends (then again they'll have plenty of time to get those licenses, or not).
Xi is moving back to not quite doctrine Marxism and the economy, especially the private-ish part of it is taking hits, especially in web/apps stuff, see Jack Ma now living in Japan. That may have been justified on the merits, but it was done because he got a little too big for his britches as the CCP saw it.
In particular I'd look at the residential property market, that's a HUGE bubble that appears to be bursting now. Too many details to go into, just there's reasons it is/was so much of the economy, and not good ones.
And finally Xi is not very smart, had his education brutally ended in middle school by the Cultural Revolution, and is just not a very good helmsman. And is now the single most powerful figure in the PRC since Mao. This is not encouraging.
But the PRC and Vietnam are taking hits I interpret due to the world economy slowing down. And Xi's Zero COVID policy is perhaps becoming unsustainable. It's kinda necessary since it's prevented the population from getting natural immunity and their own vaccines aren't good and aren't trusted, and there's a lot of history behind that. If the CCP just let COVID rip, even less nasty Omicron, it would get very ugly for a while.
But it keeps shutting down huge cities and metro areas and has turned the PRC into an unreliable supplier. See the mess Apple is now in, I read something like 6 million and counting fewer iPhone Pros made at that Foxconn plant that's undergoing so much chaos and lost so many of their more experienced workers (or so I assume about the last point).
The US is in a cold war with the PRC, and that's in the process of shutting down its semiconductor industry, or maybe just the most advanced nodes depending on how the new embargo gets administered. But Apple spent quite some time qualifying what's evidently good enough flash from one of their marque companies and that's now dead since it's advanced enough to be targeted.
Overall, this embargo is a moderate sized dagger aimed at "the workshop of the world" so it's going to have effects, especially when the one year delay foreign companies have in getting licenses ends (then again they'll have plenty of time to get those licenses, or not).
Xi is moving back to not quite doctrine Marxism and the economy, especially the private-ish part of it is taking hits, especially in web/apps stuff, see Jack Ma now living in Japan. That may have been justified on the merits, but it was done because he got a little too big for his britches as the CCP saw it.
In particular I'd look at the residential property market, that's a HUGE bubble that appears to be bursting now. Too many details to go into, just there's reasons it is/was so much of the economy, and not good ones.
And finally Xi is not very smart, had his education brutally ended in middle school by the Cultural Revolution, and is just not a very good helmsman. And is now the single most powerful figure in the PRC since Mao. This is not encouraging.
I agree with almost all of your post. However I would caution against underestimating Xi.
One doesn't bubble up to the head of the CCP without being an incredibly savvy political operator. It's non-nonsensical to imply that is possible without intelligence. Even if he may be uneducated, education and intelligence are separate axis even if we normally conflate them.
Also evidence suggests he is a good strategist, even if a bit brutish in his execution.
One doesn't bubble up to the head of the CCP without being an incredibly savvy political operator. It's non-nonsensical to imply that is possible without intelligence. Even if he may be uneducated, education and intelligence are separate axis even if we normally conflate them.
Also evidence suggests he is a good strategist, even if a bit brutish in his execution.
The problem with Xi is that his demonstrated domain experience is in becoming powerful in the CCP, not in anything else I'm aware of; no reason strategy there will translate into good results for the country including its power; see Mao. The observation that he's "not a very good helmsman" comes from all the things he's not handled well since clawing his way to the top, many before COVID started roaming the land.
In sort of the same domain, see how poor the response was to "pig Ebloa" (African swine fever) which was certain to hit the PRC once it broke out in the Caucuses and was not contained there. See the 2021-22 winter thermal fuel situation which started with pique which ended Australian coal imports (which are also cheaper than the PRC's own production on the mainland).
Other stuff he inherited, like the one child policy and I'm pretty sure the residential real estate bubble, so judging the quality of his response to them in the context of all their inertia is hard. That said, puncturing economic bubbles is not thing that should be delayed, although here again it would have needed to be replaced by _something_ or the PRC would have to end its financial repression (https://en.wikipedia.org/wiki/Financial_repression), something you also see most of the rest of the world continuing.
In sort of the same domain, see how poor the response was to "pig Ebloa" (African swine fever) which was certain to hit the PRC once it broke out in the Caucuses and was not contained there. See the 2021-22 winter thermal fuel situation which started with pique which ended Australian coal imports (which are also cheaper than the PRC's own production on the mainland).
Other stuff he inherited, like the one child policy and I'm pretty sure the residential real estate bubble, so judging the quality of his response to them in the context of all their inertia is hard. That said, puncturing economic bubbles is not thing that should be delayed, although here again it would have needed to be replaced by _something_ or the PRC would have to end its financial repression (https://en.wikipedia.org/wiki/Financial_repression), something you also see most of the rest of the world continuing.