China

[Spekulatius]

1 hour ago, Parsad said:

 

Bernanke's helicopter windfall was necessary to avoid a global meltdown and a possible collapse of the entire financial system.  

 

Trump and Biden's helicopter windfalls (and you can include Trudeau and most European countries) weren't as necessary.  

 

Cheers!

Bernanke never helicoptered money. Bernanke gave money to banks by the way of easy credit (TARP) but never sent checks to the average Joe which is what helicopter money means. That happened during the pandemic under Trump and a Biden. We can argue if it was necessary or not but the money kept flowing after the pandemics was essentially over and that caused inflation.

[brobro777]

19 minutes ago, Spekulatius said:

Bernanke never helicoptered money. Bernanke gave money to banks by the way of easy credit (TARP) but never sent checks to the average Joe which is what helicopter money means. That happened during the pandemic under Trump and a Biden. We can argue if it was necessary or not but the money kept flowing after the pandemics was essentially over and that caused inflation.

yea it wasn’t just checks but also a lot of people in places like Los Angeles not paying rent for 3 years, on top of no student loan payments. That’s a lotta tax free money baby, a lot 

 

 

[Parsad]

On 11/25/2023 at 7:36 PM, Spekulatius said:

Bernanke never helicoptered money. Bernanke gave money to banks by the way of easy credit (TARP) but never sent checks to the average Joe which is what helicopter money means. That happened during the pandemic under Trump and a Biden. We can argue if it was necessary or not but the money kept flowing after the pandemics was essentially over and that caused inflation.

 

I was referencing the cartoon, which suggested that Bernanke was dropping money from a helicopter, and was defending his actions.  Cheers!

[UK]

https://www.bloomberg.com/news/articles/2023-12-01/xi-takes-flurry-of-small-steps-to-open-china-after-biden-thaw?srnd=premium-europe

[Parsad]

Chinese Borrowers Default in Record Numbers

 

https://www.ft.com/content/f144f763-873c-4b4d-99e7-5e71ae07316d?ftcamp=traffic/partner/feed_headline/us_yahoo/auddev

 

Cheers!

[Parsad]

Double yikes!!

 

https://finance.yahoo.com/news/analyst-called-chinese-bank-turmoil-000000242.html

 

Cheers!

[crs223]

Summary: people are trying to get the hell out of China — with their money of course.  Not sure who is “China Observer”, but this story agrees with my uninformed bias, so I assume it’s true (ha!).  Apparently a bunch of BABA execs have “settled” to Singapore (12:45).

 

 

[Spekulatius]

6 hours ago, crs223 said:

Summary: people are trying to get the hell out of China — with their money of course.  Not sure who is “China Observer”, but this story agrees with my uninformed bias, so I assume it’s true (ha!).  Apparently a bunch of BABA execs have “settled” to Singapore (12:45).

 

 

I have watched some of "China observer" clips on youtube and it is very biased and sensationalistic and I say this as someone who is very suspect of China CCP and their economic future.

[rogermunibond]

Sinica podcast is a more balanced.  Bill Bishop Sinocism podcast and Substack are good as well.

 

Adam Tooze on China is great imo.

 

It's amazing to me how much people are drawn to the sensationalistic analysis on YT.  Must be the algo working.

[Spekulatius]

Italy quits Belt and Road. They were the largest country in Europe to join a while ago but have now second thoughts m partly due to leadership change with the latest election:

https://finance.yahoo.com/news/italy-quits-belt-road-plan-064027543.html

[Luke]

In the end what matters are cheap local ressources available for development of technology (China has plenty, relations with russia are nice, Saudis like em too) and superiority of that technology. Who cares where the car comes from as long as they are well made and offers balance for price and performance. We saw the shift for price sensitive consumers with PDD and this will only continue with other products, Cars, Technology etc. China is a powerhouse, work ethic is very high, the infrastructure for science is on par with the US (C9 League vs Ivy League). If there is one country that is quick to change and adapt it is china, all though they will do mistakes, readjusting happens fast. Future for China is massively bullish. Our trains dont run on time and barely work and meanwhile they are eating in robot run restaurants!

[Luke]

If the US will play the war and complete cut off card that will hurt initially but the country has so much self-sufficiency, i am not worried at all. I am not even worried about the CCP taking away shares etc, people underestimate them honestly. The government has strict and specific goals for the future, are long term planners, are all smart people, corruption is now tightly controlled with Xi (compared to the corruption in western governments lol). Go China! 

 

 

 

https://www.scmp.com/news/china/politics/article/3243951/are-high-speed-trains-becoming-xi-jinpings-preferred-way-travel-china

 

 

[Xerxes]

The recent special report on PLA in The Economist is worth reading 

[Luke]

Pisa rankings also showed the superiority of the asians, Singapore, Hongkong, Taiwan etc....

[Luke]

 @Xerxes To quote from what you mentioned: 

 

A ruthlessly balanced view of the PLA is essential both to avoid war and, if necessary, to win one. 

 

Who will fight a war against China? The US? Lol and good luck! I am sure that the men and boys in the US want to give their lives to keep the NVIDIA bubble from bursting  

 

 

[Luke]

One thing one has to realize is that the dialogue in western media is incredibly US/Nato focussed. The soft power and influence of chinese culture is not even allowed to swap over, you only get painted a picture of an "enemy". Still, they are a thousands of thousands year old culture and society and on peak performance in everything, schools, technology, sport, music. Its a huge heritage, way older then the comparably small history of the US. There are little chinese movies in our cinemas, little chinese music, chinese literature and those soft power fields have been dominated by the west. South Korea and Japan are doing much better than China in that regard. 

 

When I watched the League of Legends e-sport finale, South Korea played against a Chinese team and I realized when seeing those guys playing that I have huge respect for their society and background. Every Chinese person I ever met has been more low key than other nations, but they have so much to offer. I appreciate their collectivist approach and also that they are going contrarian on many political topics, even with all the backlash. Also appreciate Li Lu and Co to develop more appreciation for Asians in the west: https://www.reuters.com/world/us/us-foundation-launches-with-125-mln-business-leaders-combat-anti-asian-hate-2021-05-03/

 

The taiwan situation is difficult and I dislike their approach, still, as Munger often said, their nation has great prospects and at 10x earnings buying one of these super well managed companies looks like a great play now. 

[Dinar]

@Luca, if China's prospects are so bright, why are millions are so eager to flee?  

US and the West has massive problems (unchecked immigration, Islamic terrorism, welfare culture, terrible education system, political correctness run amok - everything is the fault of whites, males, heterosexuals, universities that preach Marxism and destruction of Western civilization, demographics, and the list goes on.)

 

Yes, China handles many problems much better than the West - Uighyr problem, infrastructure, no teaching in schools to lowest common denominator - unlike California algebra is not considered racist.  

However, nobody in their right mind who can escape China stays there - all the entrepreneurs, and successful professionals who can gladly flee at the first choice they get.  This does not bode well for China's future.  China's demographics are incredibly bad.  

[Luke]

39 minutes ago, Dinar said:

@Luca, if China's prospects are so bright, why are millions are so eager to flee?  

 

However, nobody in their right mind who can escape China stays there - all the entrepreneurs, and successful professionals who can gladly flee at the first choice they get.

 1.4b people call China their home and their families lived there for generations. There are 5m Chinese in the US, that's a bit more than 1% of the US population and 0.3% of China's population. Who is "fleeing"? 

 

In fact, many wealthy people flee western states and try to park their money in Third World countries where they pay 0% tax, is that good for prosperity and society? In Europe the problems are so severe, the underfunding, the middle class scrapping the bottom, wealthy people leave here too, in fact they will most often try to leave for more money. That is a sad aspect but reality. 

39 minutes ago, Dinar said:

 This does not bode well for China's future.  China's demographics are incredibly bad.  

Right now the world is in crisis, birth rates drop during war and economic trouble. In germany after 1945 birthrate went up from 1.9 to 2.5, especially when things get more prosperous. Thats on the government now but its not set in stone forever and automatization can catch up a bit as well. 

[Luke]

In the US, the country is run for capital owners, the same is true in most western countries. In China and Asia, the country is run more for society and the people. Investors are much safer in the US and West but on the same side they are facing huge inequality problems, corrupt governments, underinvestment etc. I think a country that encourages more growth for everyone by means of higher taxation will do better in the long run, although you probably can get more money in the west as long as there is no civil war. So you will have some prosperity payments in China, but it's not all for nothing since over long term, the revenue generation and nation wide wealth will be better. Wallstreet doesnt care at all about all that, but for long term investing this does matter. 

 

Edited December 8, 2023 by Luca

[Luke]

Its funny if you read through PDD earnings call, they play the game very well, pointing out SUSTAINABLE GROWTH and overall development etc and not something like "we make a shit ton of money and can squeeze consumers out". 

 

Its hard to find a proper balance between absolute corporate domination and too much state intervention and blocking. I agree that having a moat in china is not as valuable as having a moat in the US but i think due to the fierce market the CCP wants the economy and technology will do much better than here. 

[Luke]

If i look at my home, germany, and at our government and then extrapolate to 2050 and also look at China and their government and what goals they set themselves, i think life will look MUCH better in china than here.

China mid century Goals: 

New heights are reached in every dimension of material, political, cultural and ethical, social, and ecological advancement.

-- Modernization of China's system and capacity for governance is achieved.

-- China has become a global leader in terms of composite national strength and international influence.

-- Common prosperity for everyone is basically achieved.

-- The Chinese people enjoy happier, safer, and healthier lives.

"The Chinese nation will become a proud and active member of the community of nations," said Xi.

Edited December 8, 2023 by Luca

[Luke]

And its funny, that Biden literally sounds like Xi now: 

 

https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/02/07/remarks-of-president-joe-biden-state-of-the-union-address-as-prepared-for-delivery/

 

And that’s always been my vision for our country.

To restore the soul of the nation.

 

To rebuild the backbone of America, the middle class.

To unite the country.

 

For decades, the middle class was hollowed out.

Too many good-paying manufacturing jobs moved overseas. Factories at home closed down.

 

Once-thriving cities and towns became shadows of what they used to be.

 

I ran for President to fundamentally change things, to make sure the economy works for everyone so we can all feel pride in what we do.

 

To build an economy from the bottom up and the middle out, not from the top down. Because when the middle class does well, the poor have a ladder up and the wealthy still do very well. We all do well.

 

Implementing caps on medication (COMMUNISM)!!!

 

This law also caps out-of-pocket drug costs for seniors on Medicare at a maximum $2,000 per year when there are in fact many drugs, like expensive cancer drugs, that can cost up to $10,000, $12,000, and $14,000 a year.

 

Instead, they used those record profits to buy back their own stock, rewarding their CEOs and shareholders.

 

That’s why I propose that we quadruple the tax on corporate stock buybacks to encourage long term investments instead.

 

Let’s finish the job and close the loopholes that allow the very wealthy to avoid paying their taxes.

 

 

So tonight, let’s all agree to stand up for seniors. Stand up and show them we will not cut Social Security. We will not cut Medicare.

Those benefits belong to the American people. They earned them.

 

Here’s my message to all of you out there: I have your back. We’re already preventing insurance companies from sending surprise medical bills, stopping 1 million surprise bills a month.

 

Capitalism without competition is not capitalism. It is exploitation.

 

I’ve made clear with President Xi that we seek competition, not conflict.

 

 

We are the United States of America and there is nothing, nothing
beyond our capacity if we do it together.

May God bless you all. May God protect our troops.

[crs223]

Luca: why do people want to flee China?

[Luke]

17 minutes ago, crs223 said:

Luca: why do people want to flee China?

The CCP is tackling exactly this, prosperity for the countryside and a less "top down" economy, as Biden put it

[Luke]

https://www.reuters.com/technology/jdcom-cut-senior-executives-salaries-by-10-20-2022-11-22/

 

China's JD.com said on Tuesday it would cut the salaries of more than 2,000 senior managers by 10% to 20% next year to help pay for improved benefits for other staff amid the government's "common prosperity" drive to reduce income inequality.

 

Liu also plans to personally donate 100 million yuan to a fund that help children of JD employees should anything happen to their parents, said the letter, which was circulated online and later confirmed by JD.com as authentic.

 

Chinese President Xi Jinping last year launched a renewed drive for "common prosperity", as an effort to reduce income inequality that threatens long-term economic growth and even the legitimacy of Communist Party rule.

 

This would do pretty much any country more good, these guys shouldn't make Millions in Bonus, tons of Options etc. while the rest lives like shit.

Edited December 8, 2023 by Luca