China

[UK]

https://www.bloomberg.com/news/articles/2023-08-16/china-s-housing-slump-is-much-worse-than-official-data-shows#xj4y7vzkg

[Ulti]

https://www.reuters.com/world/china/why-is-china-not-rushing-fix-its-ailing-economy-2023-08-17/

[Luca]

"Common prosperity for all people" is an "essential feature of Chinese-style modernization and distinguishes it from Western modernization," Xi said.

Western-style modernization "pursues the maximization of capital interests instead of serving the interests of the vast majority of people," Xi said.

"Today, Western countries are increasingly in trouble," Xi said. "They cannot curb the greedy nature of capital and cannot solve chronic diseases such as materialism and spiritual poverty."

 

https://www.voanews.com/a/china-s-xi-calls-for-patience-amid-economic-slump-/7228724.html

 

http://en.qstheory.cn/2023-07/05/c_899816.htm

 

"The world today is undergoing both transformation and upheaval; changes unseen in a century are unfolding at a faster pace; human society faces unprecedented challenges. Unity or split, peace or conflict, cooperation or confrontation -- these are the questions raised again by our times. My answer is this: the people's wish for a happy life is our goal, and peace, development and win-win cooperation are the unstoppable trends of the times.

 

Third, we should focus on practical cooperation and expedite economic recovery. Promoting economic growth is a common task for all countries in the region. China stands ready to work with all sides to implement the Global Development Initiative, keep to the right direction of economic globalization, oppose protectionism, unilateral sanctions and the overstretching of national security, and reject the moves of setting up barriers, decoupling and severing supply chains. We should make the pie of win-win cooperation bigger, and ensure that more development gains will be shared more fairly by people across the world.

 

We need to enhance the connection of high-quality Belt and Road cooperation with development strategies of various countries and regional cooperation initiatives. We should further promote trade and investment liberalization and facilitation, speed up the development of port infrastructure and regional and international logistic corridors, and ensure stable and smooth functioning of regional industrial and supply chains. Ten years ago I proposed the Belt and Road Initiative, and on its tenth anniversary, China will hold the third Belt and Road Forum for International Cooperation. I welcome your participation. We should work together to broaden the Belt and Road as a "path of happiness" benefiting the whole world.

 

The Chinese people are rallied behind the Communist Party of China to pursue Chinese modernization. It is the modernization of a huge population, of common prosperity for all, of material and cultural-ethical advancement, of harmony between humanity and nature, and of peaceful development. With these main attributes, it has created a new form of human advancement. China hopes to share new development opportunities with SCO members and all countries around the world through its achievements in modernization, and together make the world a better place."

 

Doesnt sound horrible and I even agree on the failure of the west to achieve common prosperity over the last 30 years.

Edited August 17, 2023 by Luca

[Luca]

2 hours ago, Ulti said:

https://www.reuters.com/world/china/why-is-china-not-rushing-fix-its-ailing-economy-2023-08-17/

"A small number of Western politicians and media amplify and hype up the temporary problems existing in China's economic recovery," foreign ministry spokesman Wang Wenbin told media on Wednesday.

"They will eventually be slapped in the face by reality," he said.

[cubsfan]

2 minutes ago, Luca said:

"Common prosperity for all people" is an "essential feature of Chinese-style modernization and distinguishes it from Western modernization," Xi said.

Western-style modernization "pursues the maximization of capital interests instead of serving the interests of the vast majority of people," Xi said.

"Today, Western countries are increasingly in trouble," Xi said. "They cannot curb the greedy nature of capital and cannot solve chronic diseases such as materialism and spiritual poverty."

 

https://www.voanews.com/a/china-s-xi-calls-for-patience-amid-economic-slump-/7228724.html

 

http://en.qstheory.cn/2023-07/05/c_899816.htm

 

"The world today is undergoing both transformation and upheaval; changes unseen in a century are unfolding at a faster pace; human society faces unprecedented challenges. Unity or split, peace or conflict, cooperation or confrontation -- these are the questions raised again by our times. My answer is this: the people's wish for a happy life is our goal, and peace, development and win-win cooperation are the unstoppable trends of the times.

 

Third, we should focus on practical cooperation and expedite economic recovery. Promoting economic growth is a common task for all countries in the region. China stands ready to work with all sides to implement the Global Development Initiative, keep to the right direction of economic globalization, oppose protectionism, unilateral sanctions and the overstretching of national security, and reject the moves of setting up barriers, decoupling and severing supply chains. We should make the pie of win-win cooperation bigger, and ensure that more development gains will be shared more fairly by people across the world.

 

We need to enhance the connection of high-quality Belt and Road cooperation with development strategies of various countries and regional cooperation initiatives. We should further promote trade and investment liberalization and facilitation, speed up the development of port infrastructure and regional and international logistic corridors, and ensure stable and smooth functioning of regional industrial and supply chains. Ten years ago I proposed the Belt and Road Initiative, and on its tenth anniversary, China will hold the third Belt and Road Forum for International Cooperation. I welcome your participation. We should work together to broaden the Belt and Road as a "path of happiness" benefiting the whole world.

 

The Chinese people are rallied behind the Communist Party of China to pursue Chinese modernization. It is the modernization of a huge population, of common prosperity for all, of material and cultural-ethical advancement, of harmony between humanity and nature, and of peaceful development. With these main attributes, it has created a new form of human advancement. China hopes to share new development opportunities with SCO members and all countries around the world through its achievements in modernization, and together make the world a better place."

 

Doesnt sound horrible and I even agree on the failure of the west to achieve common prosperity over the last 30 years.

Come on @Luca “common prosperity for all people “ is just a fancy word for “Communism “!

 

Its great that the West “failed “ at common prosperity- that means that meritocracy and capitalism actually works!

 

 

[Luca]

https://www.scmp.com/news/china/politics/article/3231318/xi-jinping-speech-calling-patience-released-amid-economic-gloom

 

“We should first consider the size of the population and the large rural-urban development gap. We cannot be ambitious and unrealistic, but we cannot simply follow the beaten path,” Xi was quoted as saying by Quishi.

 

“Some developing countries have almost reached the threshold of developed countries in their process of modernisation, but they have fallen into the middle-income trap and been stuck in stagnation for a long time or even backtracked substantially,” Xi said.

 

“One of the reasons is that they have not resolved [social] polarisation and stratification.”

 

Common prosperity – a policy aimed at narrowing the wealth gap – has caused anxiety among entrepreneurs and foreign companies in recent years, but Beijing denies it is seeking to suppress private enterprises.

 

Doesnt sound like a mad men at all, realistic assessment of problems we face also in germany. 

 

Also doesnt sound like they wanna leave industrialisation/capitalism. Just that the state has the power and that capital cant just do what it wants. 

[cubsfan]

4 minutes ago, Luca said:

"A small number of Western politicians and media amplify and hype up the temporary problems existing in China's economic recovery," foreign ministry spokesman Wang Wenbin told media on Wednesday.

"They will eventually be slapped in the face by reality," he said.

Well this is actually true as the Biden administration, the corrupt media and corporate interests actually have millions of $$ to lose if China becomes an international pariah like Russia.

[cubsfan]

“Common Prosperity = Equality of Outcome = Facism “

 

That pretty much sums up your links…

 

 

Give the State all the Power - and we’ll take care of all of you

 

Don’t worry @Luca - the USA isn’t far behind…

[Luca]

9 minutes ago, cubsfan said:

Come on @Luca “common prosperity for all people “ is just a fancy word for “Communism “!

 

Its great that the West “failed “ at common prosperity- that means that meritocracy and capitalism actually works!

 

 

I disagree, I think Xi and the administration sees that wages are not growing anymore in the west because the little man gets completely squeezed out by corporations. I said it before: Growing wages for everyone have been the driver of capitalism all along, if profits and wealth gets channeled upwards (which is the case for the whole western hemisphere) you have a small fraction getting richer and richer while the rest stagnates or in a worse case even falls of. 

 

The data is clear in my homecountry germany and its true for the US too: 

 

1. Middle class is shrinking

2. Real wages have stagnated more than 20 years, Pie is getting smaller for the majority and larger for the top!

3. Wealth is concentrated in the hands of a few families (45 families owning as much as the bottom 50% in germany)

4. Investment in infrastructure completely lacked, germany doesnt even have a functioning railroad anymore (car industry can lobby political parties): https://www.theguardian.com/world/2018/dec/20/trains-on-time-germans-deutsche-bahn-railway  "We are becoming a joke’: Germans turn on Deutsche Bahn

5. Taxes have been severly reduced for high income earners and tax loopholes prevent any taxation of giant wealth piles that do nothing. 

 

Its a mess and china doesnt want to end like that. 

 

Edited August 17, 2023 by Luca

[UK]

 

On January 31, 1979, Deng Xiaoping, China’s paramount leader of the post-Mao era, boarded a plane for a historic visit to the United States. Deng was in very high spirits. How could he not be in such a bright mood? A few weeks prior, the People’s Republic of China (PRC) and the United States of America established diplomatic relations. This was a gigantic achievement for Deng, as it allowed him to accomplish a critical step toward his plan to launch China’s grand “reform and opening-up” project. The United States, as Deng then perceived, should play a central role in China’s drive toward modernity and beyond. Deng was not a talkative person, especially when he was with his associates. Yet he talked a lot during the cross-Pacific flight. Reportedly, Deng said something of the following effect to his associates: As we look back, we find that all of those countries that were with the United States have been rich, whereas all of those against the United States have remained poor. We shall be with the United States.

 

Luca, is this still the same with Xi?

 

[cubsfan]

I actually agree with you @Luca!!

 

But you absolutely have the WRONG premise. Middle class wages are shrinking BECAUSE the USA is move more toward socialism and farther from capitalism!

 

Government interferes in all aspects of Americans lives- “government will take care of everything, don’t you worry “

 

That’s why America is failing.

[Luca]

1 minute ago, UK said:

 

On January 31, 1979, Deng Xiaoping, China’s paramount leader of the post-Mao era, boarded a plane for a historic visit to the United States. Deng was in very high spirits. How could he not be in such a bright mood? A few weeks prior, the People’s Republic of China (PRC) and the United States of America established diplomatic relations. This was a gigantic achievement for Deng, as it allowed him to accomplish a critical step toward his plan to launch China’s grand “reform and opening-up” project. The United States, as Deng then perceived, should play a central role in China’s drive toward modernity and beyond. Deng was not a talkative person, especially when he was with his associates. Yet he talked a lot during the cross-Pacific flight. Reportedly, Deng said something of the following effect to his associates: As we look back, we find that all of those countries that were with the United States have been rich, whereas all of those against the United States have remained poor. We shall be with the United States.

 

Luca, is this still the same with Xi?

 

This was a brilliant move by Deng and got China where it is now. Xi never says anywhere that he wants to isolate (see quotes i attached). The economies just have changed so radically that China is not only a manufacturing hub that was able to drive massive expansion of US capital but they are direct competitors and partly even superior. Thats why the tone in relations is changing. 

 

Back then we produced our cars in china and sold them our cars. 

 

Now they produce their own cars and send them to us and we might even end up producing their cars? 

 

Complete change of the reality and thats what Dalio calls changing world order. 

 

If i look at the US markets and their administration and at Chinas markets and Chinas administration, i see a LOT of strenght in China. Not saying the US is weak or anything, big amazing businesses, tons of IP and money, technology etc. 

 

But its a country id bet on to be a significant player for the future, Xi WANTS China to be a significant player. 

[cubsfan]

5 minutes ago, Luca said:

This was a brilliant move by Deng and got China where it is now. Xi never says anywhere that he wants to isolate (see quotes i attached). The economies just have changed so radically that China is not only a manufacturing hub that was able to drive massive expansion of US capital but they are direct competitors and partly even superior. Thats why the tone in relations is changing. 

 

Back then we produced our cars in china and sold them our cars. 

 

Now they produce their own cars and send them to us and we might even end up producing their cars? 

 

Complete change of the reality and thats what Dalio calls changing world order. 

 

If i look at the US markets and their administration and at Chinas markets and Chinas administration, i see a LOT of strenght in China. Not saying the US is weak or anything, big amazing businesses, tons of IP and money, technology etc. 

 

But its a country id bet on to be a significant player for the future, Xi WANTS China to be a significant player. 

China will be a major player, the question for the world is - will they be a good neighbor??

 

From the looks of Taiwan and the South China Sea - it does NOT look promising…

[Luca]

14 minutes ago, cubsfan said:

I actually agree with you @Luca!!

 

But you absolutely have the WRONG premise. Middle class wages are shrinking BECAUSE the USA is move more toward socialism and farther from capitalism!

 

Government interferes in all aspects of Americans lives- “government will take care of everything, don’t you worry “

 

That’s why America is failing.

What drove wages in the past and before a "post fordist" capitalism? UNIONS. 

 

People of today are mostly atomized, even those sectors that have Unions cant properly fight for better wages (my Uncle works basic construction Job but dropped out because the unions are so useless). If you have no Unions and no pressure for better wages, the corporations can just set wages, especially if you get homeless if you dont work (US). This leads to a growing minimum wage sector (absolutely true for germany and 1/4th of the people gets below 14€ an hour) and little investment from smaller and medium-sized enterprises because they can't compete at all due to lacking demand. Dividends are fat because wages are bad but these dividends mostly get send to few big shareholders. You end up with more and more concentrated markets which have even more bargaining power against higher wages. They influence politics--> And then you have a slow growth, stagnating local economy where the majority of money goes to few owners and a more and more desperate and hopeless population that starts voting right wing. (because all the parties before just executed the neoliberal model). 

 

I found this article and i think it sort of describes what i think is happening with western economies: 

 

 

 

And then you have china, a government that cant be bought, a government that wants REAL big GDP growth, REAL increase in living standards for EVERYONE. 

 

 

colombiaint-15051.pdf

 

 

 

Edited August 17, 2023 by Luca

[Luca]

I think trump was seen as this sort of saviour for the disenfranchised american that was desperat for REAL CHANGE (where is the change obama)? He did want to implement tariffs etc and was starting to talk to unions, miners etc. But he wont solve it with giving corporations even more free rule because we will end up with the same state as the last decades. 

 

[Luca]

Republicans in the 20th century where actually very much for regulation, they even had slogans against wage slavery, Unions were respected etc. It turned around 180 degree, Bernie Sanders could have easily run as a republican candidate 100 years ago but was called a socialist by many today's republican voters. It doesnt take much, increase funding for public infrastructure, support healthy wage growth (exactly what china is doing, forced wage increases etc), regulate some of the greedy companies that abuse workers and that influence politics too much. Regulate the housing market.

 

The CCP is actually reasonable in many ways they regulate their markets. 

 

And of course we need a healthy market, going back to Mao Zedong is bad and the administration knows this 100% i am sure. 

Edited August 17, 2023 by Luca

[UK]

21 minutes ago, Luca said:

This was a brilliant move by Deng and got China where it is now. Xi never says anywhere that he wants to isolate (see quotes i attached). The economies just have changed so radically that China is not only a manufacturing hub that was able to drive massive expansion of US capital but they are direct competitors and partly even superior. Thats why the tone in relations is changing. 

 

Back then we produced our cars in china and sold them our cars. 

 

Now they produce their own cars and send them to us and we might even end up producing their cars? 

 

Complete change of the reality and thats what Dalio calls changing world order. 

 

If i look at the US markets and their administration and at Chinas markets and Chinas administration, i see a LOT of strenght in China. Not saying the US is weak or anything, big amazing businesses, tons of IP and money, technology etc. 

 

But its a country id bet on to be a significant player for the future, Xi WANTS China to be a significant player. 

 

I kinda agree with you on achievements of China and its companies etc.

 

And yet with the latest policies of Xi they somehow ended up on the ‘wrong side of history’ in the eyes of US/west.

 

The whole thing escalates almost weekly. Tariffs, more and more sanctions, aid for Taiwan etc.

 

Or just look: https://www.theguardian.com/us-news/2023/may/09/ron-desantis-bills-ban-chinese-citizens-buying-land-florida

 

How can you be sure this is not going to end badly? Or badly at least for western investors in China? 

[Luca]

A historic bull market for American businesses while real wealth and wages of American citizens stagnated perfectly coincides. Super high earnings and large buybacks are the opposite of a coin where the workers and average citizens fall behind. 

[cubsfan]

9 minutes ago, Luca said:

I think trump was seen as this sort of saviour for the disenfranchised american that was desperat for REAL CHANGE (where is the change obama)? He did want to implement tariffs etc and was starting to talk to unions, miners etc. But he wont solve it with giving corporations even more free rule because we will end up with the same state as the last decades. 

 

The working class (forgotten and abandoned by the Democratic Party) voted Trump in , benefited hugely .

 

They are now back to the forgotten class. 

[cubsfan]

3 minutes ago, Luca said:

A historic bull market for American businesses while real wealth and wages of American citizens stagnated perfectly coincides. Super high earnings and large buybacks are the opposite of a coin where the workers and average citizens fall behind. 

Of course you are correct…but this is not a reason for socialism.

 

But it IS the reason that a populist President was elected, as the population gave the finger to BOTH parties.

 

But the solution is NOT socialism 

[Luca]

11 minutes ago, UK said:

 

I kinda agree with you on achievements of China and its companies etc.

 

And yet with the latest policies of Xi they somehow ended up on the ‘wrong side of history’ in the eyes of US/west.

Yes because China executes a model that has not been executed in the US but that could end up being superior. Its a real threat, otherwise you wouldnt have had any coverage and constant threatening communication. Nobody cares what some poor peasants in africa do in their countries because they will be economically meaningless. China wont be. And they really are a threat because they are coming to the table with full force and if they continue gaining economic traction, we will fall behind. 

11 minutes ago, UK said:

 

The whole thing escalates almost weekly. Tariffs, more and more sanctions, aid for Taiwan etc.

Yeah thats ought to be expected, just the Temu example shows how disruptive china is. They can seriously mix things up, they are a powerhouse. 

11 minutes ago, UK said:

 

Or just look: https://www.theguardian.com/us-news/2023/may/09/ron-desantis-bills-ban-chinese-citizens-buying-land-florida

 

How can you be sure this is not going to end badly? Or badly at least for western investors in China? 

I think it also depends on your perspective, i think for US investors this feels an edge heavier because the political tensions are severe but cut off from china like with russia is unimaginable lets be serious. It wont ever happen, maybe you will have higher tariffs and blocking of apps etc okay. In case of prosus, do i think the share of tencent they own in their name will be unaccessable? I think thats highly unlikely and id ignore the risk. We will have to live and deal with china, no way around it. 

Edited August 17, 2023 by Luca

[Luca]

So i built up a position that wont kill me if it goes to 0 although i think that is very unlikely. Now its up to china to execute, how much can they grow GDP over the next decade two decades? There are so many people still poor, so much potential for development and i think the CCP can really do this, with ups and downs. Just own a big strong moaty company in that region, how can it not be worth significantly more with all these tailwinds? Hold it through the ups and downs, regulations will continue but tencent is still rocking, they will still release their games, people will still use wechat, people will still play league of legends, they will continue being a great investor worldwide etc. 

[Luca]

15 minutes ago, cubsfan said:

The working class (forgotten and abandoned by the Democratic Party) voted Trump in , benefited hugely .

 

They are now back to the forgotten class. 

There are some polls that show that almost half the population feels hopeless on a regular basis or so, China has access to that data too. The use of psychiatric medication is skyrocketing too, in the Netherlands 1 in 16 people take antidepressants. We have some serious problems going on and people are desperate for change, also before covid. Trump indeed mixed things up because he came from his sort of own billionaire pockets and was kind of "unfunded". Thats why democrats hated him, that scene with clinton where he said he uses the tax benefits SHE created, completely bombed her. But i dont think he was THE savior americans wanted. But at least they had some sort of feeling of a mix up and change. 

Edited August 17, 2023 by Luca

[Luca]

13 minutes ago, cubsfan said:

Of course you are correct…but this is not a reason for socialism.

 

But it IS the reason that a populist President was elected, as the population gave the finger to BOTH parties.

 

But the solution is NOT socialism 

China wont have "socialism" like mao zedong did it, it will be a hyper capitalistic market still BUT with regular regulation and intervention that fine tunes growth for all. I think we just have to see what the CCP can achieve this decade but the data points to me look still good, despite temporary headwinds and of course as every human: some mistakes will come too. 

Edited August 17, 2023 by Luca

[UK]

2 minutes ago, Luca said:

So i built up a position that wont kill me if it goes to 0 although i think that is very unlikely. Now its up to china to execute, how much can they grow GDP over the next decade two decades? There are so many people still poor, so much potential for development and i think the CCP can really do this, with ups and downs. Just own a big strong moaty company in that region, how can it not be worth significantly more with all these tailwinds? Hold it through the ups and downs, regulations will continue but tencent is still rocking, they will still release their games, people will still use wechat, people will still play league of legends, they will continue being a great investor worldwide etc. 

 

I agree with you on Tencent/Prosus. But I disagree with "cut off from china like with russia is unimaginable lets be serious". Maybe it is just my imagination, but especially after this whole "unlimited friendship" situation, I can imagine even much worse things than cut off. And I am just afraid to play Russian roulette here, especially with some meaningfull alocation. I tried it in 2021, but after war in Ukraine and Xi not returning to normal, changed my mind.