Political Posts

[Luke]

https://www.bloomberg.com/news/features/2024-01-09/if-china-invades-taiwan-it-would-cost-world-economy-10-trillion

 

https://www.taiwannews.com.tw/en/news/5075352

 

TAIPEI (Taiwan News) — A Chinese invasion of Taiwan would cost the global economy US$10 trillion (NT$311 trillion), equivalent to 10% of global GDP, higher than the Ukraine war, COVID-19 pandemic, and the 2009 global financial crisis, according to a Bloomberg Economics estimate.

 

 

China's relations with major trading partners will be disrupted and it will be unable to obtain advanced semiconductors. As a result, its GDP is expected to suffer a 16.7% slide in the first year.

The U.S. GDP is expected to slump by 6.7% in the first year. Despite being far from the center of the conflict, the U.S. faces significant risks due to its reliance on the Asian electronic supply chain, particularly with companies like Apple Inc.

The world's GDP is projected to drop by 10.2% in the first year, with South Korea, Japan, and other East Asian economies suffering the greatest harm.

 

According to Bloomberg Economics research, if a war breaks out in the Taiwan Strait, the potential global GDP losses could surpass those incurred by the 2020 COVID-19 pandemic, the 2009 global financial crisis, the 1991 Gulf War, the 2001 U.S. 9/11 terrorist attacks, and the 2023 Israel-Hamas war.

Edited January 12, 2024 by Luca

[Luke]

https://www.scmp.com/news/china/diplomacy/article/3248301/belgian-prime-minister-meets-xi-jinping-beijing-vows-oppose-decoupling

[Luke]

https://www.bloomberg.com/news/articles/2024-01-12/tencent-added-back-by-3-billion-top-asia-fund-despite-china-s-gaming-rules?srnd=technology-vp

 

$3 Billion Top Asia Fund Bets on Tencent Again Despite China Gaming Rules

 

Federated Hermes Asia Ex-Japan Equity Fund, which beat 83% of its peers for the past three years, made the purchase in the new year, even after China released a draft rule on gaming restrictions in December. The investment reflects the fund’s optimism over the nation’s beaten-down market, where valuations are “absolutely incredible,” said Jonathan Pines, who manages the $3.1 billion fund.

“We are buying it now because of its very cheap value,” he said in an interview Wednesday, referring to Tencent’s shares. Pines’ fund sold most of its shares in Tencent as well as in Taiwan Semiconductor Manufacturing Co. about a year ago.

Edited January 13, 2024 by Luca

[james22]

15 hours ago, Luca said:

https://www.scmp.com/news/china/diplomacy/article/3248301/belgian-prime-minister-meets-xi-jinping-beijing-vows-oppose-decoupling

 

 

[mattee2264]

So China is a bit of a basket case and outside some of the tech companies is considered un-investable by most investors.

Question is what impact will Chinese economic malaise have on the ROW and specific stock sectors?

 

The failure of China's reopening has clearly depressed commodity prices as China drove the super cycle.

Possibly some benefits for other exporters that can pick up some of the slack.

But maybe some contagion to neighbouring countries such as Japan?

Probably not great for Apple and Tesla which unlike the other Mag7 countries have a heavy exposure to China.

Definitely not good for luxury goods companies (which we are already seeing in results of Burberry/LVMH) 

 

Any other thoughts?

 

 

[Luke]

https://www.scmp.com/news/china/diplomacy/article/3248661/chinas-economy-beat-target-52-growth-2023-premier-li-qiang-tells-davos-forum?module=top_story&pgtype=homepage

 

China’s economy beat target with 5.2% growth in 2023, Premier Li Qiang tells Davos forum

 

 

[mattee2264]

US grew the exact same amount Q3 (before revisions). 

 

I think economic data is pretty suspect and subject to a lot of political motivation in both countries. As a famous politician once said "It's the economy stupid". 

[changegonnacome]

Zelenskys former ex-spokesperson - seen on Ukrainian TV during the war - a true insider - laying out the history and situation in realistic terms.

 

Worth a look

 

 

Paraphrasing some points - 

 

 - "Russia does not feel secure - it began the war because of NATO expansion....and we in Europe/Ukraine can laugh at that....but they REALLY feel this way"

 

 - Donbas is lost - but we in Ukrane shouldn't be focused on it - Donbas was never really part of Ukraine - it's like Northern Ireland in the UK.... a place that was neither truly Ukranian nor truly Russian...but is now Russian.

 

- he was part of Istanbul peace talks - deal on the table then was advantogous for Ukraine - but deal collapsed (he doesn't know why)

Edited January 16, 2024 by changegonnacome

[ValueArb]

3 minutes ago, changegonnacome said:

Zelenskys former ex-spokesperson - seen on Ukrainian TV during the war - a true insider - laying out the history and situation in realistic terms.

 

Worth a look

 

 

Paraphrasing some points - 

 

 - "Russia does not feel secure - it began the war because of NATO expansion....and we in Europe/Ukraine can laugh at that....but they REALLY feel this way"

 

 - Donbas is lost - but we in Ukrane shouldn't be focused on it - Donbas was never really part of Ukraine - it's like Northern Ireland in the UK.... a place that was neither truly Ukranian nor truly Russian...but is now Russian.

 

- he was part of Istanbul peace talks - deal on the table then was advantogous for Ukraine - but deal collapsed (he doesn't know why)

 

Like all PR flacks sounds like he's full of it. The war began because of Russian expansionism, NATO only really became an issue after the invasion to attempt to give Putin a justification. 

 

I won't argue whether Donbas is lost, its definitely a very tough nut to crack, a lot tougher than Crimea. But for a place that is not truly Ukrainian its pretty amazing how hard Kharkiv fought against the Russians, and its right next door to Donbas with a huge percentage of Russian speakers.

 

And if he thinks the Istanbul deal on the table was advantageous for Ukraine I don't know what to say. It would have basically turned over 100% of Ukraine to Russia over time.

[changegonnacome]

1 minute ago, ValueArb said:

Like all PR flacks sounds like he's full of it. The war began because of Russian expansionism, NATO only really became an issue after the invasion to attempt to give Putin a justification. 

 

I report, you decide - given I put up the vid like 10 minutes ago and you responded 3 minutes later - I'm glad to see you've watched it, taught about and then marintated on it for a while  

 

Guess he's just a guy that was part of Zelensky government, partook in the Istanbul peace talks and is now part of a group of political voices in Ukraine outlining a path forward by reflecting on the conflicts origins.....as you know @ValueArb the Russian expansionism argument carries no weight with me.....and remains, in my opinion, the exact narrative that a nations ruling classes via media creates to engender support for the resources that are to be dedicated to the fighting to come.

 

Its much harder to a fund war - with something approximating the following........"we in the West made a miscalculation in our zeal to expand liberal democracy via NATO expansion in Ukraine....we were ignorant to Russian red lines and their own internal security concerns and now Ukraine find itself between a rock and a hard place cause we led them down the primrose path.....so we're gonna have to spend $100bn+++ to try save some face and play the good guys."

 

Better to run with the Putin imperial madman narrative....it most definitely requires less intellectual overhead thats for sure....any alternative framework for thinking about the war is just way to complicated.....better to have theory of cops and robbers, cowboys and indians.....than the way the real world is......in which most countries/nations are simultaneously 

[changegonnacome]

26 minutes ago, ValueArb said:

NATO only really became an issue after the invasion to attempt to give Putin a justification. 

 

William J. Burns,U.S. Ambassador to Russia, 2008 - Cable back to Washington D.C.

 

"Ukrainian entry into NATO is the brightest of all redlines for the Russian elite (not just Putin). I have yet to find anyone who views Ukraine in NATO as anything other than a direct challenge to Russian interests.”

 

https://www.washingtonpost.com/outlook/2021/12/23/ukraine-taiwan-red-lines/

 

William J. Burns,U.S. Ambassador to Russia, 2008 Message to Condoleezza Rice:

 

“Ukrainian entry into NATO is the brightest of all redlines for the Russian elite (not just Putin). In more than two and a half years of conversations with key Russian players, from knuckle-draggers in the dark recesses of the Kremlin to Putin’s sharpest liberal critics, I have yet to find anyone who views Ukraine in NATO as anything other than a direct challenge to Russian interests.” 

Found in:

https://www.penguinrandomhouse.com/books/561709/the-back-channel-by-william-j-burns/

 

 

 

 

Edited January 17, 2024 by changegonnacome

[ValueArb]

27 minutes ago, changegonnacome said:

 

I report, you decide - given I put up the vid like 10 minutes ago and you responded 3 minutes later - I'm glad to see you've watched it, taught about and then marintated on it for a while  

 

Guess he's just a guy that was part of Zelensky government, partook in the Istanbul peace talks and is now part of a group of political voices in Ukraine outlining a path forward by reflecting on the conflicts origins.....as you know @ValueArb the Russian expansionism argument carries no weight with me.....and remains, in my opinion, the exact narrative that a nations ruling classes via media creates to engender support for the resources that are to be dedicated to the fighting to come.

 

Its much harder to a fund war - with something approximating the following........"we in the West made a miscalculation in our zeal to expand liberal democracy via NATO expansion in Ukraine....we were ignorant to Russian red lines and their own internal security concerns and now Ukraine find itself between a rock and a hard place cause we led them down the primrose path.....so we're gonna have to spend $100bn+++ to try save some face and play the good guys."

 

Better to run with the Putin imperial madman narrative....it most definitely requires less intellectual overhead thats for sure....any alternative framework for thinking about the war is just way to complicated.....better to have theory of cops and robbers, cowboys and indians.....than the way the real world is......in which most countries/nations are simultaneously 

 

I've peaced out as soon as he claimed russia has a legitimate security concern over NATO, and that they need a new alliance in Europe for collective defense just like NATO.  

 

I've also read enough detailed summaries of the Istanbul peace talks from participants I need to watch a 58 minute video for his dubious opinions? Clearly Putin isn't an honest negotiator, he's shown this over and over again that any agreement he signs is pure toilet paper. Anyone who thinks just giving him part of Ukraine to "end" the war won't end with him taking all of Ukraine is making an extraordinary claim that requires extraordinary evidence. Opening a bottle of champagne over that? Delusional.

 

And I've never called Putin a madman. He was just following Dictator plan A, appease the population with an "easily winnable" war that will increase the territory and resources under his control. Just turned out not to be winnable. Very clearly he's trying to restore the Russian Empire just like the Tsars and just like Stalin and Lenin did with the USSR. It would maximize his power and his legacy.

 

And it has nothing to do with NATO. Again there is a history of Putin saying he didn't care if Ukraine joined NATO, that he'd even consider Russian joining before 2008. Then he decided he wanted Ukraine and it suddenly changed. And NATO is a defensive alliance, its charter clearly doesn't allow it to be invoked to invade anyone, so the only risk to Russia from NATO has been from its own expansionist tendencies. Its a laughable "red line" akin to saying if you try to put sprinklers in that building we are going to burn it down. 

 

And again why should we give a shit about what the elite in this toilet bowl of a third world country think?

[changegonnacome]

4 minutes ago, ValueArb said:

why should we give a shit about what the elite in this toilet bowl of a third world country think?

 

Serious question - with this viewpoint - why @ValueArb with all due respect even bother commenting or engaging in a thread which is fundamentally at its core a kind of international relations/security themed discussion...where what Russia thinks and by extension does is kind of foundational to the kicking around the subject?

[Gregmal]

53 minutes ago, changegonnacome said:

 

I report, you decide - given I put up the vid like 10 minutes ago and you responded 3 minutes later - I'm glad to see you've watched it, taught about and then marintated on it for a while  

 

Guess he's just a guy that was part of Zelensky government, partook in the Istanbul peace talks and is now part of a group of political voices in Ukraine outlining a path forward by reflecting on the conflicts origins.....as you know @ValueArb the Russian expansionism argument carries no weight with me.....and remains, in my opinion, the exact narrative that a nations ruling classes via media creates to engender support for the resources that are to be dedicated to the fighting to come.

 

Its much harder to a fund war - with something approximating the following........"we in the West made a miscalculation in our zeal to expand liberal democracy via NATO expansion in Ukraine....we were ignorant to Russian red lines and their own internal security concerns and now Ukraine find itself between a rock and a hard place cause we led them down the primrose path.....so we're gonna have to spend $100bn+++ to try save some face and play the good guys."

 

Better to run with the Putin imperial madman narrative....it most definitely requires less intellectual overhead thats for sure....any alternative framework for thinking about the war is just way to complicated.....better to have theory of cops and robbers, cowboys and indians.....than the way the real world is......in which most countries/nations are simultaneously 

I laughed at this but it’s true. I don’t even bother to read the Russia/China/Middle East stuff anymore because I can easily guess what the stupid Western narrative slant will be. It’s a waste of time. I’m not sure they taught the Cuban Missile Crisis in history either. Must have been replaced with gender studies.

[ValueArb]

57 minutes ago, changegonnacome said:

 

Serious question - with this viewpoint - why @ValueArb with all due respect even bother commenting or engaging in a thread which is fundamentally at its core a kind of international relations/security themed discussion...where what Russia thinks and by extension does is kind of foundational to the kicking around the subject?

Seriously, Russias GDP is smaller than Italys. Far smaller at this point, probably not even top 20 anymore. Is basically a larger version of North Korea. How much should we care about what Kim Jong Il thinks?

 

And know your history, Russian governments have always been horrifically backwards and oppressive. They treat their own people as disposable serfs. So again why should we accept any of their wrong headed opinions? Putin is going to claim whatever he needs to get whatever he wants, our job is to say no to him, force him to behave himself and ensure he doesn't invade other countries. We’ve been doing it for almost 80 years and now is not the time to stop.

[Dinar]

@ValueArb, you need to care about what North Korea thinks because it has nukes and can wipe out South Korea, Taiwan, Japan, and parts of the US.  Looking at Russia through a GDP prism is a mistake.  If Russia stops trading with the rest of the world, what will happen to oil, gas, uranium, titanium and other commodities?  When Russia is 30% of the titanium supply for aircraft, that surely matters.  

[Xerxes]

3 hours ago, Gregmal said:

 I’m not sure they taught the Cuban Missile Crisis in history either. Must have been replaced with gender studies.

ask Chris about Cuban missile crisis

 

 

[Joseywales]

Is there anyone on this board who currently resides in China or has lived there in the recent years? I'm interested in gaining some perspective from someone with firsthand experience.

 

From the outside it seems like the sky is falling and people much smarter than me are predicting doom and gloom for the next 50+ years with projections such as demographics, debt, labor, housing crisis etc... 

Edited January 17, 2024 by Joseywales

[hillfronter83]

Just came back from my two-week trip to China. It's the first time seeing my family and friends in more than four years. Stayed in a small city near Shanghai and travel around in the region. Here are some observations:

 

• Overall economy is very challenging, although some high end restaurants seem to be doing fine.
• real estate will be doomed for years to come according to a real estate company executive friend. Even rural areas have a lot of high rise apartments (around 30 stories). I suspect these will be very costly to maintain and most Chinese are known for their frugalness. Don't feel good about the value of these building in 20 years. and most people i know already have multiple apartments.
• world class infrastructure everywhere, ie high speed rail, subway, etc. some of those projects were built to increase land value. While they look great, I'm not sure about the economic soundness. They are also very costly to maintain.
• e-commerce is very active, many people do grocery online nowadays.
• It's hard to increase consumption. most wealth is concentrated in people born in 60s, 70s. They grew up frugal and most people don't feel the desire to consume. The biggest spending is on food, but you can only eat 3 meals a day. secondly, the income decease is very real. a few years ago, local government employees were making over RMB300k, now it's about half, sometime lower.
• most people are stressed except the retirees. rich people (some centimillionaires) are worried about their shrinking net worth. and poor people are working 10-hour days to make their mortgage payment.
• although national birth rate are low. people i know are still having kids. but it could be they are local in a small city that is more affordable.
• most of the wealthy people's kids are living/studying in US or Europe.
• some of my friends, who used to drive BMW, Audi, are now driving Chinese made EVs. 

 

[ValueArb]

14 hours ago, Dinar said:

@ValueArb, you need to care about what North Korea thinks because it has nukes and can wipe out South Korea, Taiwan, Japan, and parts of the US.  Looking at Russia through a GDP prism is a mistake.  If Russia stops trading with the rest of the world, what will happen to oil, gas, uranium, titanium and other commodities?  When Russia is 30% of the titanium supply for aircraft, that surely matters.  

 

Since North Korea has nukes, and feels it's the rightful ruler of South Korea, we should accept its opinion and let Kim Jong Il have it? Since Russia has nukes, and feels Ukraine should be part of it's sovereign territory, we should let Putin have it?

 

If we don't think the price of freedom is worth paying a bit more for titanium, oil and gas, what is it worth? Trade with Russia means a whole lot more to Russia than it does to the rest of the world. It has to export to survive, so its a strawman to say if we don't give them Ukraine (and then Georgia, and Belorussia, etc, etc) they'll stop exporting, that would be Putin's suicide.

[Dinar]

49 minutes ago, ValueArb said:

 

Since North Korea has nukes, and feels it's the rightful ruler of South Korea, we should accept its opinion and let Kim Jong Il have it? Since Russia has nukes, and feels Ukraine should be part of it's sovereign territory, we should let Putin have it?

 

If we don't think the price of freedom is worth paying a bit more for titanium, oil and gas, what is it worth? Trade with Russia means a whole lot more to Russia than it does to the rest of the world. It has to export to survive, so its a strawman to say if we don't give them Ukraine (and then Georgia, and Belorussia, etc, etc) they'll stop exporting, that would be Putin's suicide.

You hear but you do not listen.  Nowhere did I say that we should do what Putin or Kim want us to do.  You said it does not matter what Russia wants because it is a tiny % of the world's GDP, I stated why % of the world's GDP is the wrong metric to use.   Muslims have killed 3,000 Americans on 9/11, what % of world's GDP was Afghanistan at that point?  Yet it mattered because Muslims based in Afghanistan hatched a plot that killed 3,000 Americans.  

[ValueArb]

18 minutes ago, Dinar said:

You hear but you do not listen.  Nowhere did I say that we should do what Putin or Kim want us to do.  You said it does not matter what Russia wants because it is a tiny % of the world's GDP, I stated why % of the world's GDP is the wrong metric to use.   Muslims have killed 3,000 Americans on 9/11, what % of world's GDP was Afghanistan at that point?  Yet it mattered because Muslims based in Afghanistan hatched a plot that killed 3,000 Americans.  

 

So you are saying we should have pulled out of the middle east when Osama Bin Laden made his first threats?

 

My point on Russia is they are trapped, and we should not let them out of the trap. The fact they have a tiny GDP is important because it means that replacing the military equipment they are losing (esp. the most advanced) will take them years, if not decades. The only option we should give them is total withdrawal from Crimea and Donbas. 

[Dinar]

Just now, ValueArb said:

 

So you are saying we should have pulled out of the middle east when Osama Bin Laden made his first threats?

 

My point on Russia is they are trapped, and we should not let them out of the trap. The fact they have a tiny GDP is important because it means that replacing the military equipment they are losing (esp. the most advanced) will take them years, if not decades. The only option we should give them is total withdrawal from Crimea and Donbas. 

All I am saying is that the importance of the country is not measured by its GDP.  I am NOT saying that we should what a KGB operative or a terrorist or a dictator wants us to do.  

[John Hjorth]

For the purpose of perspective : Worldometers - GDP by country :

 

[John Hjorth]

37 minutes ago, ValueArb said:

... My point on Russia is they are trapped, and we should not let them out of the trap. The fact they have a tiny GDP is important because it means that replacing the military equipment they are losing (esp. the most advanced) will take them years, if not decades. ...

 

Reuters [27 November 2023] : Putin approves big military spending hikes for Russia's budget.

 

Quote

MOSCOW, Nov 27 (Reuters) - Russian President Vladimir Putin gave his official approval to a significant increase in military spending that will see around 30% of fiscal expenditure directed towards the armed forces in 2024 as he signed draft budget plans into law on Monday.

 

Moscow is diverting ever more resources towards prosecuting its war in Ukraine. Spending on defence and security combined is set to reach around 40% of all budget expenditure next year.

 

Spending on defence is set to increase by almost 70% in 2024 from 2023.

 

Russia has an ambitious 2024 revenue target of 35.1 trillion roubles ($391.2 billion) next year, a 22.3% planned increase year-on-year, based on assumptions of high oil prices. Analysts say the government may be forced to hike business taxes if those assumptions should prove optimistic.

 

The budget plans had already been approved by lawmakers in both houses of parliament, the State Duma and Federation Council.

 

So a budget shock, and balance based on expections of continued high oil prices. [Not mentioned, but plan B : To tax the hell out of the businesses owned by the oligarchs ! [because there are no money other places] ... wonderful - just wonderfull!]]

Edited January 17, 2024 by John Hjorth