China

[benchmark]

4 hours ago, Spekulatius said:

 

On the other hand does anyone really think that Chinese Colleges are better than US ones ? Does anyone know of a Chinese American sending their kids back to a Chinese college?

One of my neighbors sent his son to Tsinghua, China's MIT. 

[lnofeisone]

@Dinar The short version of the two main points is - there is likely no over-representation of black students in Harvard (at least not 40x) and what you are seeing with Stuy is a reflection of the process in place more than the quality of students. Let me elaborate:

 

1) Harvard has a much bigger pool of applicants than Stuy and is thus more likely to have a population of applicants that's reflective of the population as a whole. You are right, if 10% of applicants are black somehow results in 15% of black population, there is some skew. But it is not 40x skew. 

 

2) The applications are structurally different and that has a real impact on what the applicant pool looks like. Anytime processes like these are introduced, there is high variability in actual populations. Getting into Stuy is an elaborate process with real risks that need to be weighed and Harvard is generally a free market. Students in NYC get to pick and rank 12 high schools in order of preference. If I qualify and rank Stuy as 1 but don't get in, I may also lose out on choices 2, 3, and 4. I may end up going to my #5 choice, which is brutally inconvenient. However, If I were to rank my number 2 school as #1, I may have a great chance of getting into a decent school that isn't Stuy but one that is more convenient for me. There are further restrictions, with some schools having auditions (La Guardia?) and some schools requiring SHSATs.  Every applicant (and their parents) has to weigh all these factors. When you apply to Harvard, it's a free market. I can be a kid from Brooklyn with a terrible GPA, and poor SAT score and still apply and there would be no penalty other than a loss of the application fee. Or I can be a student with 4.2GPA, and great SAT scores coming from Thomas Jefferson in Virginia. No ranking, no prioritizing, just straight-up applicants. This will cause a much bigger pool of applicants that is likely representative of the student population of the nation and thus Harvard class will generally reflect that.

 

If you want to validate this thinking - look at HBCUs. Why is the black student population of HBCUs higher than any college and higher than % of black population as a whole? You will find your answer in the applicant population demographics. Your applicant pool will drive your student body demographics. 

 

You can also invert this logic and ask a question - why do some schools in NYC have an over-represented black student body? Applicant pool demographics.

[Luca]

Wow, China is a bloodbath right now!

[RetroRanger]

https://asia.nikkei.com/Politics/China-s-party-congress/Transcript-President-Xi-Jinping-s-report-to-China-s-2022-party-congress

 

Funny that china even said many positive things

 

"We will make appropriate reductions to the negative list for foreign investment, protect the rights and interests of foreign investors in accordance with the law, and foster a world-class business environment that is market-oriented, law-based, and internationalized. We will promote the high-quality development of the Belt and Road Initiative."

 

"We will improve the functions of the capital market and increase the proportion of direct financing. We will take stronger action against monopolies and unfair competition, break local protectionism and administrative monopolies, and conduct law-based regulation and guidance to promote the healthy development of capital.2

 

[Spekulatius]

i think the stock market really disliked the Neo Maoist vibes from this Congress. Then there was the selection of leadership for each Politburo:

 

https://www.scmp.com/business/china-business/article/3196994/hong-kong-stock-index-slumps-below-16000-mark-new-13-year-low-chinas-leadership-reshuffle-leaves-no?module=live&pgtype=homepage

 

They keep on saying the right things from time to time (also stronger action against monopolies may not be that great for Alibaba and the likes )to calm things down, but the signaling toward a new Maoist era isn’t really bullish for equity investors by any stretch of imagination.

 

The simple message from the CCP Congress is that expect more of the same of what you have been seeing lately as long as Xi is around (at least).

[formthirteen]

44 minutes ago, Spekulatius said:

They keep on saying the right things from time to time (also stronger action against monopolies may not be that great for Alibaba and the likes )to calm things down, but the signaling toward a new Maoist era isn’t really bullish for equity investors by any stretch of imagination.

 

The simple message from the CCP Congress is that expect more of the same of what you have been seeing lately as long as Xi is around (at least).

 

China is uninvestible, but it's still possible to speculate in the Chinese stock market. If Xi passes the Marshmallow test, the stock market should do well. If not he will (try to) invade Taiwan and continue to do stupid things (from foreign stock speculators' point of view).

 

Nobody talks about the Chinese invasion of the Philippines (Spratly). They have roughly the same playbook as Russia, first the green men arrive, then the tourists:

 

However, it seems China is not the only one invading, LOL:

[hillfronter83]

4 hours ago, RetroRanger said:

https://asia.nikkei.com/Politics/China-s-party-congress/Transcript-President-Xi-Jinping-s-report-to-China-s-2022-party-congress

 

Funny that china even said many positive things

 

"We will make appropriate reductions to the negative list for foreign investment, protect the rights and interests of foreign investors in accordance with the law, and foster a world-class business environment that is market-oriented, law-based, and internationalized. We will promote the high-quality development of the Belt and Road Initiative."

 

"We will improve the functions of the capital market and increase the proportion of direct financing. We will take stronger action against monopolies and unfair competition, break local protectionism and administrative monopolies, and conduct law-based regulation and guidance to promote the healthy development of capital.2

 

It's not about what he says. Everybody supportive of economic reform were pushed out. There will be fundamental changes in the country's direction going forward and nobody can stop him now.

 

 

[Luca]

1 hour ago, hillfronter83 said:

It's not about what he says. Everybody supportive of economic reform were pushed out. There will be fundamental changes in the country's direction going forward and nobody can stop him now.

 

 

Very mixed signals from Xi, supporting businesses and common prosperity/socialist reforms, lots of FUD

[Spekulatius]

The next step is China sanctioning  the US in retaliation to the US semiconductor sanctions enacted right before the CCP Congress.

[beerbaron]

This paper suggests that China's GDP could be more than half of it's reported size. I would be interested to hear what you guys think and how to see if peer reviews agree with this paper.

 

https://bfi.uchicago.edu/wp-content/uploads/2021/07/BFI_WP_2021-78.pdf

 

Here is a quick youtube video for those too lazy to read:

 

BeerBaron

[Spekulatius]

This cartoon is actually pretty good:

 

[Spekulatius]

US / Blinken‘sview on Taiwan:

 

[Sweet]

How can the economy grow so much and yet this ^ be the case?

 

Something wrong there.

[lnofeisone]

@Sweet - it's not uncommon for EM to have growing economies while stocks underperform. Brazil is a good example. Mexico too. Mexico has a couple of airports discussed on the board but investing in them doesn't guarantee anything. The investment is beholden to political whims and currency issues. 

 

If China's GDP is indeed 40% of what it is today, that has some very serious ramifications for companies like BABA/TCEHY as they are much bigger and much more important than we understood them. That's a big deal and provides a new light as to why Xi cracked down on them so much. 

[Ulti]

https://www.seafarerfunds.com/prevailing-winds/security-over-growth/

good read on where China is heading

[Sweet]

8 hours ago, lnofeisone said:

@Sweet - it's not uncommon for EM to have growing economies while stocks underperform. Brazil is a good example. Mexico too. Mexico has a couple of airports discussed on the board but investing in them doesn't guarantee anything. The investment is beholden to political whims and currency issues. 

 

If China's GDP is indeed 40% of what it is today, that has some very serious ramifications for companies like BABA/TCEHY as they are much bigger and much more important than we understood them. That's a big deal and provides a new light as to why Xi cracked down on them so much. 

@lnofeisone thanks, I wasn’t aware of that, I don’t follow either Brazil or the Mexican markets.

 

I’d be fairly sure that China GDP is smaller than the headline figure but no idea of the magnitude.  It would be quite something if it was 40% lower.

[Suri22]

out of all  the comments  ip theft ,  human rights issues, false gdp numbers, western narrative 

 

why nobody is talking about rare earth elements  where china literally  has monopoly on that ??  

 

 

https://press.armywarcollege.edu/cgi/viewcontent.cgi?article=3129&context=parameters

 

https://eurasiantimes.com/the-world-must-come-together-to-stop-chinas-monopoly/

 

 

[Suri22]

https://foreignpolicy.com/2020/10/27/how-the-united-states-handed-china-its-rare-earth-monopoly/

[lnofeisone]

20 minutes ago, Surya said:

https://foreignpolicy.com/2020/10/27/how-the-united-states-handed-china-its-rare-earth-monopoly/

China has the largest extraction capability but they also have the largest reserves. 20x of what US has (on average across all rare earths) Sure, a lot of extraction IP and tech went to China, but it was only a matter of time before they would dominate. In fact, having them export as much as they can makes everyone else's resources more valuable. 

[UK]

Xi is sending a letter: https://www.bloomberg.com/news/articles/2022-10-31/blinken-speaks-with-china-s-top-diplomat-in-latest-sign-of-thaw?srnd=premium-europe

 

But US is sending back B-52: https://www.bloomberg.com/news/articles/2022-10-31/us-building-facility-to-base-b-52-bombers-in-australia-abc-says

[LongHaul]

On 10/27/2022 at 4:36 PM, beerbaron said:

This paper suggests that China's GDP could be more than half of it's reported size. I would be interested to hear what you guys think and how to see if peer reviews agree with this paper.

 

https://bfi.uchicago.edu/wp-content/uploads/2021/07/BFI_WP_2021-78.pdf

 

Here is a quick youtube video for those too lazy to read:

 

BeerBaron

I did not read the paper but Totally agree with the premise.

The Chinese government has likely been lying about China's GDP growth for 10+ years.  

Apparently GDP doesn't even add up from the regional to national level.  

Compound out 10+ years of inflated GDP and it is probably a very big number.   

 

I think I read that China is lying about the size of their population also.  

 

That would make the real estate problem much, much worse in China. 

 

There was an analysis of lights and GDP and dictators generally claim their GDP is higher than reality

for various reasons. 

 

 

 

 

 

 

 

[Spekulatius]

LOL, feels like twilight zone:

https://www.cnbc.com/2022/10/31/shanghai-disney-shuts-over-covid-visitors-unable-to-leave.html

[Gregmal]

45 minutes ago, Spekulatius said:

LOL, feels like twilight zone:

https://www.cnbc.com/2022/10/31/shanghai-disney-shuts-over-covid-visitors-unable-to-leave.html

What’s funny is that a year ago, this was California and NY. 

[Spekulatius]

46 minutes ago, Gregmal said:

What’s funny is that a year ago, this was California and NY. 

Not even close, because you could leave.

[sleepydragon]

16 hours ago, Surya said:

https://foreignpolicy.com/2020/10/27/how-the-united-states-handed-china-its-rare-earth-monopoly/

rare earth is not rare at all. It’s everywhere. American stopped mining it because it’s too cheap and labor is too costly.

 

this is like saying American has a monopoly on coal mining — it’s not like this is a easy and money making nice job.