joefranklinsrs

only the last few ones :) but hey, please ban me for talking about the urgent issues of the day.

Subjugating a billion people to AQI 600+ for 20 years isn't genocide?

Locking a million muslims up and exterminating them isn't genocide?

"It is actually designed to exterminate — eliminate — the whole Uighur nation as people," he said.

"Children are being removed even when their families are willing to care for them, according to Financial Times Beijing correspondent, Emily Feng."

https://www.abc.net.au/news/2018-09-28/china-working-to-elim...

The most dangerous thing China export is oppression. Digital&AI surveillance, social credit system, 50 cents online army, and a CCP twisted dogma that authoritarianism + capitalism works (hint: it doesn't. It required blind beliefs from other countries to invest trillions of dollars and give up IPs in order to enter a market that would never be as big as they think)

Belt and Road: Malaysian government stopped a $20B project. Maldives just called it one-sided. India refuses to have anything to do with it. So do most of the EU members. Media around the world is calling it debt trap

Regulation: deadly vaccines. deadly milk powder. Their citizens then choose to buy foreign goods only

hard work: they are at their job 60 hours a week. but only working 20.

You forgot about the millions of jobs that disappear in China after factories leave for other countries.

You forgot about the billions of foreign direct investment that actually helped China to get to where it is today, now leaving the country.

You forgot about the real estate bubble in China deflating. The one that has the middle class of China paying for $1M house with their $1300/month income.

These flurry of NYTimes favorable articles on China, the last few days, is....fascinating. It's almost like those with vested interests knew a huge crash is about to come to China in 2019, and is trying to unload some investments.

However, the ever connected world is not blind, and can see the dramatic fall China has suffered in the last 2 years in terms of stock market, yuan weakness, capital outflow, human rights, massive debts, international relations, factories leaving, fake GDPs, and much more. $250B in tariff on Chinese imports in January 2019, followed up with potentially rest of the $600B in tariff on Chinese imports in 2019, will crash China.

NYTimes is going overdrive cranking out favorable coverage on China the past couple of days. Perhaps NYTimes editors got some reminder from Wall Street that China again needs to be sold to the American public. Since Wall Street dismantled the American workers 30 years ago with NAFTA and China/WTO, it probably felt like it can do it again with the incoming $250B tariff on Chinese imports.

Problem is, US is winning, big - China Is Paying for Most of Trump's Trade War, Research Says. https://www.bloomberg.com/news/articles/2018-11-19/china-is-...

The world is shades of grey. nothing and nobody is black or white. the context and magnitude of illegal immigrant separation/war criminals and muslim concentration camps are completely different.

To think about going to China, you're going to have to think about how to LEAVE china first

"once the news goes out that you will be leaving China, alleged creditors will come out of the woodwork. The tax authorities will come up with taxes that you owe. Your landlord will explain why you owe it way more than you thought you did. Your suppliers will send you bills for items they never actually gave you. Your employees will demand all sorts of severance."

https://www.chinalawblog.com/2018/09/how-to-terminate-your-c...

If we look at the history of how US dismantled its manufacturing after the 90s (yes it started way before, but it was in much smaller scope), it was WALL STREET manipulation that allowed jobs to escape to countries with lowest amount of human rights but cheapest wages. You see before then, companies did offshoring but it was in small quantities, because they feared the unions and especially the massive import tariffs that would have been thrusted on them by the government if they had gone mostly offshore.

NAFTA, which was heavily pushed by wall street and also welcomed by certain corporations, snuck in through NAFTA-friendly advisors that Clinton surrounded himself with. By establishing the principle that U.S. corporations could relocate production elsewhere and sell back into the United States, NAFTA undercut the bargaining power of American workers. Also by letting China into WTO in the 90s, China has been abusing the rules ever since, destroying manufacturing jobs in democratic countries around the world. Bush escalated the suffering by giving China most preferred status. Obama didn't do much to contest except some stern warnings against China.

And now we have a belligerent China, lead by a dictator, that is more powerful than USSR in its heydays, with signs of third-reich behaviors (muslim concentration camps, technology-thought controls), vastly increasing its military and technological weapons to confront and attack US and its allies. And technology companies are still transferring technologies to China, either willingly, unwillingly or unknowingly.

WALL STREET did this. Some corporations were complicit. Then most of them were. Bill Clinton destroyed the American workers. Every other presidents that followed didn't stand up. Trump actually confronted China.

And now WALL STREET is trying to stop the full $600B trade tariffs against China.

Good for Bloomberg; I'm sure it will also play nicely for his presidential campaign ;)

But it would be interesting if Bloomberg were to win in 2020 - we would have back-to-back businessman turned chief in command. So far, Trump has been pretty good for US economy. Bloomberg might be even better.

Now you are just grasping at straws :) but hey, everyone on the internet is a racist right?

Nope, simply giving context

I meant to say that the author works for Washington Post

Very optimistic piece about the Chinese economy from a Chinese American who now resides in China. The author works for Washington Post, which is owned by Jeff Bezos, whose company Amazon greatly benefits from China.

There is no doubt this is a piece that is trying to rally around a very unlikely scenario where the US administration will give into Chinese belligerence and back off on trade tariffs at the end of November when Trump and Xi meets - despite Trump, Pence, the current Trump administration, and even prominent Democrats' hardline against China. A trade war which the US is winning strongly.

A couple of things stands out from the article: reminiscience about the great Chinese growth in the last 30 years, and "The party appears to enjoy broad public support, and many around the world are convinced that Mr. Trump’s America is in retreat while China’s moment is just beginning." That last thing is the conclusion drawn out of nowhere, and very incorrect. US has been growing 4% this year, while every other major economies around the world has suffered. https://www.cnn.com/2018/11/14/economy/economy-global-slowdo...

The author cleverly avoids talking about China's now: slumping economy, the ever increasing local government/corporate/personal debt, export falling 30% year-over-year in Guangdong, the top exporting province https://sinoinsider.com/2018/10/risk-watch-declining-export-..., potential tariff on all of China's import into US, the great military alliance between US, Japan, Australia, India and several other Southeast Asian countries against China in South Asia Sea, western ambassadors demanding answers to China's imprisonment of Muslim minority https://www.businessinsider.com/china-slams-western-ambassad..., and last, how private companies which drove the innovations in china are dying out to state enterprises https://www.bloomberg.com/news/articles/2018-10-24/china-s-s....

EDIT: clarified author

I didn’t go into the 20-30% loss in GDP in detail, but it factors in loss of millions of manufacturing and management jobs, fake/wasteful GDP boosting stopped, loss of FDI, capital outflow, debt deleveraging, 20-30% further drop in Yuan, etc etc

"If those are actually further up the value chain leading to exports to the US (as you seem to suggest), those would largely be imported goods."

The Chinese factories that produce goods destined for US, also produce goods for other countries, leading to trade between China and those countries. When factories move to Malaysia or Vietnam, those trades disappear.

"as proven by the fact that plenty of brands have no trouble selling basically everywhere despite "fragmented" markets" . I was addressing your point "they can still manufacture goods intended for anywhere else in the world there - just not for the US" . You're basically losing 30%-40% of your sales. That's not something that can just be brushed off.

"India already appears to be backpedaling on their earlier posturing." Citation? a cursory search shows otherwise https://www.power-technology.com/comment/india-levies-safegu... https://economictimes.indiatimes.com/industry/indl-goods/svs...

"especially now that Chinese labor and manufacturing is going to become cheaper again"

Why? Wage and rent inflation is skyrocketing in China. Yuan will drop dramatically, which means energy/resource imports will skyrocket.

"The US will be forced to pay more for everything"

I'm assuming your assumption is because China is taking over all of the resources/production capabilities around the world? I don't think that can even remotely happen. Again, lots of multinationals are already 30% in Vietnam, Malaysia, or India. Companies can source ag or oil from plenty of non-Chinese sources. The consumers have barely felt the supply chain shifts.

"The US is a manufacturing powerhouse, but its production is bipolar"

You would be surprised at how much reshoring and US factories automation have occurred in the last few years in US. It will increase in scope after this current round of tariffs.

"The US will have to bootstrap a lot of manufacturing to replace Chinese labor."

They just have to move to cheaper countries to replace Chinese labor. One time upfront asset cost, but lower expense over time.

"US trade "only" accounts for about ~18% China's total trade"

Once China is not part of the trade flow between US and X country (Taiwan, South Korea, Japan, etc), the total trade for China will fall even more than 18%.

"they can still manufacture goods intended for anywhere else in the world there - just not for the US"

US is the largest consumer market in the world. Japan is second at 1/3 of the size of US. EU consumer market is mostly fragmented. There is just not that much singular consumer demand outside of US. Plus other countries are enacting tariffs on China as well - India for example.

"Especially other foreign companies operating in China will profit from reduced competition for Chinese labor / manufacturing, encouraging them to move more manufacturing there."

There are lots of countries that have way cheaper labor costs than China, there's no reason for the foreign companies to go there in the face of increasing tariffs. Nike is 30% in Vietnam. Samsung is producing more of its phones in Vietnam. Uniqlo increased its presence in Vietnam by 40%.

"US companies will only withdraw in part from from China, since they can still manufacture goods intended for anywhere else in the world there "

Again, tariffs and cheaper labor costs elsewhere will entice companies to move out of China entirely. Not to mention the threat of Chinese government takeover of assets, or capital outflow restriction.

I would argue time is (and always has been) on US's side. US has the more powerful economy, and the consumer market that China desperately needs to keep afloat. In addition, time will allow US companies to move its supply lines out of China without triggering volatility in its stock prices.

This actually looks like the start of the disentanglement between the US economy and the Chinese economy. What will likely happens next (my best guess) is

1.) 40-60 percent of a company’s supply chain moves out of China

2.) China restricting the movement of capital/equipments out of China (similar to what happened with Korean companies last year)

3.) China growing homebrew competitors to the foreign companies leaving, part of the ‘made in 2025 in China’ strategy, via state enterprises or state spendings in startups. China will also make US companies’ operation in China very hard, either with license restrictions, or increased local ownership.

4.) China will disincentivize Chinese consumers from purchasing US (or foreign) products, via propaganda, taxes, or control (similar to what happened with Japanese and Korean products last few years). This would be hard, as Chinese consumers prefer higher quality, higher brand value, and higher perceived value foreign products.

5.) China will have to target US farmers with tariffs, as there isn’t much US imports to tax otherwise. Plus, there is also face saving.

6.) US will increase the tariff coverage to all Chinese imports, either triggered by tariffs on US farmers, or threats to US companies.

7.) China local governments will try to seize US owned corporate assets, or prevent factories from shutting down by its owners. This will escalate the urgency for US companies to move out of China.

8.) 70-100% of company’s supply line will be out of China

9.) Eventually, most direct trades between both countries shrink down to less than $50B. Down to a significant level where it starts to effect GDP for both countries (China way more than US)

10.) China will have no choice but to embrace its lost decade, ala Japan. It will tighten controls on its citizens. It will try to contain high inflation and high unemployment rate. It will try to unwind its debt for the next 10-20 years. Its gdp growth will go towards 0 or negative. Its GDP will shrink 20-30%.

(posted this in another thread but didn't get any discussion)

This actually looks like the start of the distanglement between the US economy and the Chinese economy. What will likely happens next (my best guess) is

1.) 40-60 percent of a company’s supply chain moves out of China

2.) China restricting the movement of capital/equipments out of China (similar to what happened with Korean companies last year)

3.) China growing homebrew competitors to the foreign companies leaving, part of the ‘made in 2025 in China’ strategy, via state enterprises or state spendings in startups. China will also make US companies’ operation in China very hard, either with license restrictions, or increased local ownership.

4.) China will disincentivize Chinese consumers from purchasing US (or foreign) products. Via propaganda, state media, others. This would be hard, as Chinese consumers prefer higher quality, higher brand value, and higher perceived value products.

5.) China will have to target US farmers with tariffs, as there isn’t much US imports to tax otherwise. Plus, there is the face saving situation.

6.) US will increase the tariff coverage to all Chinese imports, either triggered by tariffs on US farmers, or any other targets.

7.) China local governments will make a mistake of seizing a US owned corporate asset, or prevent a factory from shutting down by its owners. This will escalate the urgency for US companies to move out of China.

8.) 70-100% of company’s supply line will be out of China

9.) Eventually, most direct trades between both countries shrink. Down to a significant level where it starts to drop gdp for both countries (China way more than US)

10.) China will have no choice but to embrace its lost decade, ala Japan. It will tighten controls on its citizens. It will try to contain high inflation and high unemploment rate. It will try to unwind its debt for the next 10-20 years.

I think there are two answers to that. The first is you are a small time player. The medium to big players do have to abide by the tariffs. And what they do is shift the factories and supply lines to other countries or back to US. The cost to consumers will be the same - for the company, it is a large upfront asset purchases that depreciates over time, and expense reduction over time.

The second is US is introducing a bill to have USPS start collecting electronics information on merchandises so customs inspectors can screen parcels for fentenyl and others. If your customers didn’t declare your goods correctly, and didn’t pay the tariff, the goods might be detained or disposed. Which would then mean troubles for you and your customers. Your customers might buy from other vendors after figuring out that buying from China isn’t worth the hassle

What an odd comment to make :) It's true you can ignore all economic reality and focus on growth (fake or real). But history time and time again has shown that NOBODY escapes economic reality. Nothing goes up forever.

"Debt, we've learned, is the match that lights the fire of every crisis. Every crisis has its own set of villains - pick your favorite: bankers, regulators, central bankers, politicians, overzealous consumers, credit rating agencies - but all require one similar ingredient to create a true crisis: too much leverage."

My opinions are not of financial advice :) You can make money on a downturn as well as an upturn

If there's one single life-encompassing economic event this decade, it will be the emerging market financial crisis. The chart in the article clearly shows emerging market ex China going from 16 trillion to 29 trillion in 10 years. And China has incredibly gone from 7 trillion to 40 trillion debt in 10 years - 300% debt to GDP (not even counting another 20 trillion shadow debt, which would make it incredibly 450% debt to GDP!!) ((and if you take into account fake GDP that Chinese provinces have reported, and that authoritarian governments typically fake their economic growth, and reduce the reported GDP by 20%, it's a jaw dropping 600% debt to GDP !!!))

The emerging market crisis will accelerate pretty quickly, as soon as one or two more fed rate hike occurs, or as soon as more tariffs get levied on China from US, or any of the other black swan event that may occur (hyperinflation in other emerging markets, internal politics struggle or death of Xi Jing Ping in China, etc) . Interesting times we live in. Stay safe.

People have been proclaiming the death of silicon valley since the late 80s, when tech IPOs peaked in 1983, and the video game crash of 1983. But then silicon valley produced several more innovative booms - PC, internet, social, and mobile, making the local economy 1 trillion dollars and surpassing its cousin, LA economy. Whereas LA economy stagnated after the 90s after aerospace and manufacturing moved out, silicon valley kept its dynamism, innovativeness, and of course venture capital.

There are several hard-to-replicate formulas for silicon valley

1.) Money likes to stay in silicon valley: Other money is in silicon valley. Stanford, Berkeley, and Santa Clara university. Existing networks. Beautiful weather (26c today in san jose), low humidity. Gorgeous landscape. Great wine and michelin restaurants. World class cuisines in American, Japanese, French, Italian, Indian, Chinese, Vietnamese in Bay Area. Many activities to do year round. Beaches, mountains, coastlines, deserts, and forests. Vibrant immigrations. Good infrastructure. Close proximity to Seattle, Las Vegas, Hawaii, and Los Angeles.

2.) Talents are already in silicon valley, and their million dollar houses are in silicon valley. Easy to interview with various companies when they are all near where you work and live. Safe neighborhoods. Engineers that you can meet one another in meetups. Existing networks.

3.) California is the 5th largest economy in the world. And Silicon Valley is the fastest growing economy within it. Lack of regulations to start a startup, raise money, sell to other states in US, which is the largest economy in the world and has the largest consumer market in the world - 1/3 of the world's consuming power. the next closest consumer market that shares the same language and culture is Japan at 1/3 of US's size. And US economy is fast growing, whereas Japan and China are stagnating.

4.) Inherited knowledge is in Silicon Valley. How to bootstrap better. How to invest better. How to run teams better. How to produce software better. How to innovate faster. Everyone knows a little bit of the piece of the puzzle, and have been practicing it for 40 years.

My theory is that people are moving up to better jobs, after years of job training, education, and depressed demands, after 2008. Which would explain the low unemployment rate. Thus even though the wages for some industries are stagnating/declining, people are moving to better job positions, and thus have more money to spend.

Great question, thanks for asking!

I like Nikolai Kondratiev, Pettis, Alfred Marshall, Carmen Reinhart, and Bill Gates (read his recent stuff on software economics)

I don't like Krugman and Greenspan.